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Strong Demand Driven by 5G Transition Boosts Skyworks' Results

Company sets $2 billion share buyback plan as growth surges.
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Skyworks Solutions  (SWKS) - Get Skyworks Solutions Inc. Report topped analyst fiscal first-quarter earnings estimates Thursday, said its board has approved a $2 billion share buyback plan, and offered upbeat guidance as revenue soared at the specialized semiconductor maker amid the onset of the transition to 5G mobile networks.

The company reported non-GAAP diluted earnings per share of $3.36 on revenue of $1.51 billion after the bell.

Skyworks had been expected to report earnings of $2.09 a share, on sales of $1.1 billion, based on a FactSet survey of 26 analysts. The stock has risen about 10% since the company last reported earnings on Nov. 2.

In the same period a year ago, the company posted earnings of $1.68 a share on sales of $896.1 million. It reported net income of $210.6 million.

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"Demand for our proven solutions continues to accelerate across a growing set of customers and end markets, powering the world’s most impactful use cases, from 5G mobile platforms to IoT, wireless infrastructure, autonomous transport and machine-to-machine installations,” said Liam K. Griffin, president and chief executive officer in a statement. "Importantly, the multi-year wireless transition is now underway, creating a burgeoning set of new opportunities."

Shares of Skyworks rose $19.19, or 12%, to $178.98 in after-hours trading. In the regular session the stock gained 2.5%.

Kris Sennesael, senior vice president and chief financial officer of Skyworks, said the company anticipates fiscal second-quarter revenue “to be between $1.125 billion and $1.175 billion with non-GAAP diluted earnings per share of $2.34 at the midpoint of our revenue range, representing revenue growth of 50% and non-GAAP diluted earnings per share growth of 75%, compared to the second fiscal quarter of 2020.” 

Sennesael said the company’s board has “approved a new $2 billion stock repurchase program, reflecting their confidence in our business model driven by sustained above-market growth and strong cash flow generation."