Skyworks Solutions, Inc. (SWKS) Earnings & Analysis

Latest quarter

Skyworks reported Q3 FY2026 revenue of $934.8 million, down −3.13% from $965.0 million a year earlier. The company reported adjusted EPS of $1.08, compared with the consensus of $1.03, while revenue of $934.8 million compared with the consensus of $922.1 million.

The filing attributed the year-over-year revenue decline primarily to lower market share at a significant customer, partly offset by increased demand for automotive and data-center products. The filing reported diluted EPS of $0.22, down −68.6% from $0.70 a year earlier. It reported gross margin of 40.1%, compared with 41.6%, and operating margin of 5.19%, compared with 11.5%. The company reported free cash flow of −$16.9 million, compared with $246.0 million a year earlier.

Skyworks reported revenue within its prior $900.0 million to $950.0 million guidance range. Its reported gross margin of 40.1% was below its prior 44.5% to 45.5% guidance range.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Phil Brace said demand signals were steady, channel inventories were lean, and mobile demand remained solid heading into the seasonal fall launch cycle. He said some broad-markets products faced demand ahead of available supply, while the company monitored customer orders and inventory patterns amid evolving industry memory conditions. Brace said mobile revenue was slightly ahead of the company’s expectations, supported by demand at its largest customer and new-product ramps at its largest Android customer.

Brace said broad-markets revenue was approximately $403 million, up 8% year over year, and that Wi-Fi, data center and automotive collectively grew 15% year over year. He said the company’s data-center business was tracking ahead of the 50% annual growth rate previously outlined, despite supply constraints. In the Q&A, Brace said supply-constrained growth engines were offset by softness in consumer IoT-related devices, without providing further detail.

CFO Philip Carter said input costs remained a headwind and that Skyworks was using cost controls and selective pricing actions to contain them. Brace said pricing cannot generally be adjusted after a design is selected, while the company has raised prices where it could no longer absorb cost increases. Carter said operating expenses were $238 million as Skyworks funded R&D programs while controlling discretionary spending.

Analysts asked about customer content, Android demand and the outlook for mobile. Brace said the company expected blended content at its largest customer to be roughly flat, but did not provide SKU-level or timing details. Carter said Skyworks expected the seasonal mobile ramp to be partly offset by a decline in Asia Android business after an unusually strong third quarter.

Brace also said regulatory review of the Qorvo combination had advanced in China, and that the company was preparing for a possible close within fiscal 2026, subject to regulatory approvals and customary conditions. He said the company expected at least $500 million of synergies and had authorized a new $2.0 billion share-repurchase program through January 2029 while ceasing quarterly dividends.

Guidance

For Q4 FY2026, Skyworks expects revenue of $1.0 billion to $1.1 billion, compared with its prior Q3 FY2026 revenue outlook of $900.0 million to $950.0 million. Philip Carter said the midpoint of the Q4 revenue outlook implies non-GAAP diluted EPS of $1.27, compared with the prior Q3 FY2026 midpoint expectation of $1.03. Skyworks expects Q4 gross margin of 44.0% to 45.0%, compared with its prior Q3 FY2026 guide of 44.5% to 45.5%.