SWKS Reports 2017 Q3 Earnings

Investment Analysis Clubs Saul’s Investing Discussions
1

Another solid quarter: Beat on rev, EPS.

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 June 30, 2017. Revenue for the third fiscal quarter was $900.8 million, up 20 percent year-over-year and exceeding consensus estimates.

On a GAAP basis, operating income for the third fiscal quarter of 2017 was $304.8 million with diluted earnings per share of $1.32. On a non-GAAP basis, operating income was $333.1 million with non-GAAP diluted earnings per share of $1.57, up 27 percent year-over-year and $0.05 better than consensus estimates.

“Skyworks exceeded top and bottom line expectations in the third fiscal quarter of 2017,” said Liam K. Griffin, president and chief executive officer of Skyworks. “Our outperformance is being driven by global demand for Skyworks’ highly integrated and ultra-efficient connectivity engines. As system-level complexity and performance requirements intensify across mobile and Internet of Things ecosystems, we are extending our product reach and capturing more content per platform. Further, we are well positioned to capitalize on the rapidly approaching 5G technology wave - enabling new markets from autonomous vehicles to emerging segments in artificial intelligence, robotics and virtual reality.”

From http://investors.skyworksinc.com/releasedetail.cfm?ReleaseID…

The numbers I got:


Revenues (millions)		Q1		Q2		Q3		Q4			
2013				453.7		425.2		436.1		477.0		
2014				505.2		481.0		587.0		718.2		
2015				805.5		762.1		810.0		880.8
2016				926.8		775.1		751.7		835.4
2017				914.3		851.7		900.8

EPS (non-GAAP)		        Q1		Q2		Q3		Q4			
2013				0.55		0.48		0.54		0.64		
2014				0.67		0.62		0.83		1.12	
2015				1.26		1.15		1.34		1.52
2016				1.60		1.25		1.24		1.47
2017				1.61		1.45		1.57

2017 Q3 Earnings (Current):

Revenue Growth (millions)
2016 Q3 TTM Revenue = 3334.4
2017 Q3 TTM Revenue = 3502.2
YOY TTM Revenue Growth = 5%, previous quarter (1%)

EPS Growth (non-GAAP)
2016 Q3 TTM Earnings = 5.61
2017 Q3 TTM Earnings = 6.10
YOY TTM EPS Growth = 8.7%, previous quarter 1%

Non-GAAP P/E (Check Current Price) = 107.64/6.10 = 17.65

Matt
Long SWKS
MasterCard (MA), PayPal (PYPL), Skechers (SKX) and Square (SQ) Ticker Guide
See all my holdings at http://my.fool.com/profile/CMFCochrane/info.aspx

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2

And the share price goes back down after the earnings report. Is that because they were expected to do even better?

3

Possibly just a mild article in Barrons, ‘Investors’ Soapbox’ by JPM (sub. req.) preferring AVGO and QRVO.

I have a holding in SWKS, which is the only one to have come through the screen (again, after a hiatus) some months ago and am happy to hold.

However, it is worth keeping in mind the inventiveness and ruthlessness of AAPL, and the case of Imagination Technologies in the UK.

It’s tech.

Elsewhere, the giants fall; yesterday HD. The last man standing is beset by suitors. But I digress.

4

Skyworks improved on one of my favorite metrics for the company. The percentage of revenue coming from “broad markets” (largely the Internet of Things) increased to 27%. It had been hovering around 25% the past few quarters, although it had gotten as large as 29% during the period where revenue from Apple was meager.

I like this metric because increases show that Skyworks’ reliance on Apple is diminishing, and Skyworks claims in its investor presentations that its “broad markets” business generally carries higher margins than its mobile business.

Someone else raised the point – I think it was Matt – that Skyworks mentioned in the Q&A associated with the conference call that Skyworks is increasingly getting closer to its broad market customers, which allows them to deliver specific solutions for their customers’ needs, which is “stickier” business for them.

Maybe the shares are down a few percentage points because results didn’t meet someone’s expectations. For me, the company is slowly-but-surely moving in the right direction. I continue to hold my shares, despite not being able to watch the company’s progress as closely as I used to.

Thanks, Matt, for bringing the results overview to this board.

Fool on!
Thanks and best wishes,
TMFDatabaseBob (long: SWKS)
See my holdings here: http://my.fool.com/profile/TMFDatabasebob/info.aspx
Peace on Earth

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