Skyworks Tops Adjusted Earnings Estimates, Offers Tepid Guidance

Skyworks shares fell in after-hours trading after the chipmaker's latest results and following a regular session that saw the stock hit an all-time high.
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Skyworks Solutions  (SWKS) - Get Report reported Thursday that fiscal-second-quarter net income rose 84% on 53% higher revenue, but offered muted guidance for the fiscal third quarter.

Skyworks' Q2 revenue and adjusted earnings -- and its estimates for the fiscal third quarter -- beat expectations. The GAAP second-quarter earnings missed Wall Street's estimates.

For the quarter ended April 2, the Irvine, Calif., company earned $1.95 a share compared with $1.06 a share in the year-earlier quarter. The latest adjusted earnings were $2.37 a share. 

Revenue reached $1.17 billion from $766.1 million.

A survey of analysts by FactSet produced consensus estimates of GAAP earnings of $2.04 a share, or an adjusted $2.35 a share, on revenue of $1.15 billion.

For the fiscal third quarter, Skyworks expects adjusted earnings of $2.13 a share, based on the midpoint of its revenue range. Revenue should come in between $1.08 billion and $1.13 billion.

FactSet's survey of Wall Street analysts produced consensus estimates of adjusted profit of $2.11 a share on revenue of $1.07 billion. 

Skyworks Eyes EV, 5G Markets With $2.75B Deal for Silicon Labs Units

At last check Skyworks Solutions shares were trading down 6.9% at $184.29. They closed regular Thursday trading up 0.7% at $197.86. 

Trading on Thursday in Skyworks was a tug of war. The stock had traded up to a 52-week high $204, up almost 4% from Wednesday.

The third-quarter estimates reflect "robust demand for connectivity solutions in mobile and broad markets," Kris Sennesael, senior vice president and chief financial officer, said in a statement.

Most recently, Skyworks agreed to pay $2.75 billion cash for the infrastructure and Automotive business of Silicon Laboratories  (SLAB) - Get Report.

The acquisition includes businesses and technology that Skyworks said were "highly complementary" to its connectivity portfolio.

Analysts broadly lauded the deal as a way for Skyworks to diversify its revenue stream. Bloomberg News has estimated that based on supply chain data, Skyworks gets about 70% of its revenue from Apple.

TheStreet.com Founder Jim Cramer called the deal "extraordinary" for Skyworks.