Wireless chips maker Skyworks Solutions (NASDAQ: SWKS) met Wall Street’s revenue expectations in Q1 CY2025, but sales fell by 8.9% year on year to $953.2 million. The company expects next quarter’s revenue to be around $940 million, coming in 2.8% above analysts’ estimates. Its non-GAAP profit of $1.24 per share was 3.1% above analysts’ consensus estimates.
Is now the time to buy SWKS? Find out in our full research report (it’s free).
Skyworks Solutions (SWKS) Q1 CY2025 Highlights:
- Revenue: $953.2 million vs analyst estimates of $952.9 million (8.9% year-on-year decline, in line)
- Adjusted EPS: $1.24 vs analyst estimates of $1.20 (3.1% beat)
- Revenue Guidance for Q2 CY2025 is $940 million at the midpoint, above analyst estimates of $914.4 million
- Adjusted EPS guidance for Q2 CY2025 is $1.24 at the midpoint, above analyst estimates of $1.05
- Operating Margin: 10.2%, down from 18.1% in the same quarter last year
- Inventory Days Outstanding: 110, up from 102 in the previous quarter
- Market Capitalization: $11.25 billion
StockStory’s Take
Skyworks Solutions’ results this quarter were shaped by ongoing shifts in the mobile and wireless connectivity sectors. CEO Philip Brace, on his first earnings call since stepping into the role, highlighted the company’s diversified portfolio and its execution on multiple new product launches as key contributors. Management pointed to typical seasonal patterns in mobile, with demand normalizing after the holiday period and new launches driving activity with leading customers. In the company’s diversified segment, growth was attributed to momentum in Automotive, Edge IoT, and accelerating adoption of Wi-Fi 7, with Brace noting, “Demand signals are firming, bookings are improving, and in most segments, we’re seeing inventory normalization across the distribution channel.”
Looking ahead, management’s guidance is underpinned by expectations for continued sequential growth in its broad markets segment and a measured approach to cost control and investment. Brace emphasized the company’s focus on capitalizing on emerging trends such as increasing RF content in automotive and edge devices, as well as the expansion of Wi-Fi 7, stating, “Our position in next generation product cycles from automotive connectivity to edge IoT to timing reinforces our long-term trajectory.” CFO Kris Sennesael flagged ongoing monitoring of tariffs and a dynamic supply chain environment, while outlining plans to maintain investment in innovation despite external uncertainties. The company’s updated leadership team is expected to support these strategic priorities over the coming quarters.
Key Insights from Management’s Remarks
Management attributed the quarter’s performance to typical mobile seasonality, improving diversification, and strategic cost discipline, while also implementing key leadership changes.
-
Mobile segment seasonality: The mobile business experienced a sequential decline in line with post-holiday patterns, but benefited from new product launches with major smartphone customers. Management emphasized the need to deliver higher-performance radio-frequency (RF) components as devices shift to more AI-driven workloads.
-
Diversified business momentum: The company’s broad markets portfolio, including Automotive, Edge IoT, and industrial, achieved its fifth consecutive quarter of growth. CEO Philip Brace pointed to early-stage adoption of Wi-Fi 7 and increasing RF content in connected vehicles as primary drivers.
-
Inventory normalization: Management stated that the extended inventory correction following the pandemic appears to be largely complete across most segments, with improved booking trends and channel sell-through indicating a more stable demand environment.
-
Operational efficiency and margin focus: Skyworks continued executing on cost reduction initiatives and operational efficiencies, which, along with a favorable product mix, helped gross margins outperform internal expectations despite overall revenue declines.
-
Executive leadership transition: The company announced that Mark Dentinger will succeed Kris Sennesael as CFO, and Todd Lepinski will take over as SVP of Sales and Marketing, signaling a refreshed leadership lineup to drive future strategic initiatives.
Drivers of Future Performance
Skyworks expects broad market growth and product innovation to drive next quarter’s results, while remaining attentive to operational and macroeconomic risks.
-
Broad markets growth trajectory: Management anticipates continued momentum in the Automotive and Edge IoT segments, especially as Wi-Fi 7 adoption accelerates and vehicles increasingly rely on advanced wireless connectivity. These trends are expected to expand RF content per device and support sequential growth.
-
Cost controls and margin management: The company plans to maintain disciplined cost structures and focus on operational efficiency, aiming to protect gross margins even as utilization rates vary across manufacturing sites. This includes ongoing investment in technology development, rather than significant capacity expansion.
-
Tariff and supply chain uncertainty: While management currently sees limited direct impact from changing tariffs, they remain vigilant in monitoring the global trade environment. The company’s diversified supply chain and manufacturing presence in regions like Mexico are seen as buffers against potential disruptions.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will watch for (1) sustained growth in Automotive and Edge IoT segments, particularly as Wi-Fi 7 adoption expands; (2) execution by the refreshed leadership team on strategic and operational priorities; and (3) management’s ability to navigate evolving tariffs and supply chain dynamics. Progress in technology development and product launches will also be important to track.
Skyworks Solutions currently trades at a forward P/E ratio of 19×. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
High Quality Stocks for All Market Conditions
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.