Skyworks Finishes Qorvo Combination, Guides To $1.80 Billion To $1.90 Billion In December-Quarter Sales
Standalone fourth-quarter profit fell sharply as deal costs mounted, while the company targets $500 million or more in annual cost savings.
Skyworks Solutions, which designs analog and mixed-signal chips that handle wireless signals, power and timing, said Tuesday it completed its combination with Qorvo after its fiscal year ended, and forecast revenue of $1.80 billion to $1.90 billion for the December quarter, its first as a combined company. Its own fiscal fourth quarter, reported standalone, showed revenue of $1,046 million, down from $1,100.2 million a year earlier.
A standalone quarter squeezed by deal costs
Skyworks' fourth-quarter diluted earnings were $0.15 a share under standard accounting, against $0.94 a year earlier. On an adjusted basis they were $1.28, against $1.76. Operating income fell to $22.3 million from $111.0 million, with restructuring, impairment and other charges of $82.1 million, up from $1.6 million.
For fiscal 2026, revenue was $3.96 billion and diluted earnings were $1.14 a share, with adjusted earnings of $5.05. Because the Qorvo deal closed after the fiscal quarter ended, the September-quarter results are Skyworks alone.
Debt rose to $2,472.8 million from $995.8 million after the company issued long-term debt in the quarter. Cash and marketable securities stood at $2,606.1 million.
The first combined quarter
Combined September-quarter revenue was approximately $1.98 billion, Chief Financial Officer Philip Carter said: Skyworks' $1,046 million plus $937 million at Qorvo. Qorvo's quarter included an extra week worth about $70 million.
For December, Carter said the midpoint includes about $1.07 billion from legacy Skyworks and about $780 million from legacy Qorvo, the last quarter that split will be given. He put the midpoint down about 7% from combined September revenue, or about 3% excluding the extra week. Adjusted earnings are guided to $1.25 a share at the midpoint, on about 241 million diluted shares and about $50 million of other expense, mainly interest on the acquisition financing.
Smartphone revenue is expected to fall in the low teens percent from the prior quarter, which Carter tied to seasonality, softness in Android and the extra week. Diversified Growth Markets, which Carter said should exceed 40% of sales and be led by data center and defense, is expected to grow in the low single digits from the prior quarter.
The synergy plan
The company targets $500 million or more in annual cost savings within 24 to 36 months of close. Carter said it expects about $150 million of operating-expense savings within fiscal 2027, weighted to the second half, and an annualized run-rate of about $250 million to $300 million by the end of that year.
CEO Phil Brace said, "Our focus now is execution." The company reported an upgrade to investment grade by Moody's (Baa3) and a Stable outlook from Fitch, which affirmed BBB+.
Skyworks holds its earnings call at 4:30 p.m. EST Tuesday. From the first quarter of fiscal 2027 it will report fully combined results in two categories, Smartphone and Diversified Growth Markets.
The call Tuesday afternoon is the first chance to hear management walk through a combined company guided to about $780 million of quarterly revenue from legacy Qorvo.
Sources
- 8-K Filing — SKYWORKS SOLUTIONS, INC. (SWKS) — SEC EDGAR
- Exhibit q426earningsreleaseformex9.htm — SKYWORKS SOLUTIONS, INC. 8-K exhibit — SEC EDGAR
