Company Update (NASDAQ:SWKS): Skyworks Solutions Inc Exceeds Q3 FY15 Revenue and EPS Guidance

Skyworks Solutions Inc (NASDAQ:SWKS), an innovator of high performance analog semiconductors connecting people, places and things, today reported third fiscal quarter results for the period ending July 3, 2015. Revenue for the third fiscal quarter was $810.0 million, up 38 percent year-over-year and exceeding the Company’s guidance of $800 million.

On a non-GAAP basis, operating income for the third fiscal quarter of 2015 was $295.4 million, up 65 percent from $179.1 million in the third fiscal quarter of 2014. Non-GAAP diluted earnings per share for the third fiscal quarter was $1.34, $0.06 better than guidance and up more than 61 percent from the $0.83 reported for the third fiscal quarter of 2014. On a GAAP basis, operating income for the third fiscal quarter of 2015 was $258.8 millionand diluted earnings per share was $1.06.

“As the world becomes more interconnected, we are capitalizing on powerful secular growth trends, including the rising adoption of streaming media services, the proliferation of connectivity in emerging markets, and the Internet of Things—all of which are driving growth well in excess of the broader semiconductor market,” said David J. Aldrich, chairman and chief executive officer of Skyworks. “At the same time, our industry-leading systems solutions are facilitating an expansion of our addressable markets, creating more strategic customer relationships, and enhancing the financial returns of our Company. Looking ahead, we see tremendous opportunity to leverage our capabilities across a broadening set of markets and applications.”

Q3 Business Highlights

  • Extended automotive telematics line-up with front-end solution wins in Subaru’s 2016 models, complementing prior wins at Audi and GM
  • Launched SkyOne® Mini and diversity modules in ZTE’s Star-II LTE platform
  • Powered Gemalto’s M2M solutions for industrial and transportation applications
  • Unveiled Zigbee® analog front-ends in Home Depot’s smart lighting solutions
  • Expanded participation in Xiaomi’s smartphone portfolio, adding antenna switch and connectivity modules for LTE models targeting India
  • Gained connectivity IC wins in set-top box application with Liberty Global
  • Supported Huawei’s Honor smartphone platform with a suite of six devices addressing transmit, antenna tuning, and switch functionality
  • Delivered SkyOne® with embedded carrier aggregation and power management for 4G personal hotspot applications
  • Secured $14 of new content in femtocell design alongside leading SoC partner
  • Enabled Meizu’s 4G smartphone portfolio with SkyLiTE® solutions supporting Mediatek’s latest generation octa-core chipset

Fourth Fiscal Quarter 2015 Outlook

“We are successfully leveraging our systems portfolio to strengthen our competitive position and create more value for our customers—translating into enhanced shareholder returns,” said Donald W. Palette, executive vice president and chief financial officer of Skyworks. “For the fourth fiscal quarter of 2015, we anticipate revenue of $875 million—with non-GAAP gross margin in the 50 percent range and non-GAAP operating margin above 38 percent. From this new baseline of profitability, we forecast non-GAAP diluted earnings per share of $1.51.”

For further information regarding use of non-GAAP measures in this press release, please refer to the Discussion Regarding the Use of Non-GAAP Financial Measures set forth below.

Dividend Payment

As previously announced on June 18, 2015, Skyworks’ Board of Directors declared a cash dividend of $0.26 per share of the Company’s common stock, payable on August 27, 2015 to stockholders of record at the close of business on August 6, 2015. (Original Source)

Shares of Skyworks Solutions are up 5.41% to $105.03 following the earnings announcement. SWKS has a 1-year high of $112.88 and a 1-year low of $44.06. The stock’s 50-day moving average is $104.17 and its 200-day moving average is $94.31.

On the ratings front, Skyworkshas been the subject of a number of recent research reports. In a report issued on July 21, Oppenheimer analyst Rick Schafer maintained a Buy rating on SWKS, with a price target of $110, which implies an upside of 7.3% from current levels. Separately, on July 13, Stephens Inc’s Harsh Kumar upgraded the stock to Buy and has a price target of $120.

According to, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Rick Schafer and Harsh Kumar have a total average return of 22.5% and 28.9% respectively. Schafer has a success rate of 72.6% and is ranked #36 out of 3713 analysts, while Kumar has a success rate of 55.6% and is ranked #912.

Overall, 2 research analysts have assigned a Hold rating and 11 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $112.58 which is 9.8% above where the stock opened today.

Skyworks Solutions Inc, together with its consolidated subsidiaries is an innovator of high reliability analog and mixed signal semiconductors.

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