Skyworks Solutions has reported second fiscal quarter results for the period that ended on March 27, 2020. Revenue for the second fiscal quarter fell 5.5% to $766.1 million from $810.4 million last year. However this fall was in line with their revised revenue estimates provided soon after the COVID-19 outbreak. Both Skyworks and Qorvo announced revised revenue updates soon after the Coronavirus outbreak.
By enabling always-on, high-speed connectivity, Skyworks’ wireless technologies are essential for adapting to today’s rapidly changing business conditions and are playing a critical role in virus containment efforts worldwide. Skyworks products and solutions are connecting people throughout the world enabling telemedicine and emergency response applications, as well as supporting shelter-in-place efforts through remote work and online education.
Second Fiscal Quarter Business Highlights
- Leveraged the Sky5 platform across flagship 5G handset launches at Samsung, Oppo, Vivo, Xiaomi, and other Tier-1 players
- Expanded the technology reach across their customized Diversity Receive platforms, with new 5G-centric solutions being deployed across a growing set of customers
- Ramped wireless remote patient monitoring systems with GE
- Extended their market leadership in Wi-Fi 6 home and enterprise-grade gateways at Cisco
- Enabled home security systems at Honeywell
- Accelerated content across multiple automotive leaders including Volkswagen, Renault, Hyundai, and Nissan
- Launched asset tracking and fleet management solutions at Juniper and Blackberry
- Powered 5G mobile hotspots with Verizon and AT&T, supporting work-from-home trends
- Supported 5G Massive MIMO and small cell base station deployments across the U.S., Europe, and Japan
Third Fiscal Quarter 2020 Outlook
The company provides earnings guidance on a non-GAAP basis because certain information necessary to reconcile such guidance to GAAP is difficult to estimate and dependent on future events outside of our control.
Kris Sennesael, senior vice president and chief financial officer of Skyworks, commented that given the supply chain and demand disruptions associated with COVID-19, visibility is limited for the June quarter, resulting in a wider revenue range compared to prior quarters. Specifically, in the third fiscal quarter of 2020, they anticipate revenue to be between $670 and $710 million with non-GAAP diluted earnings per share of $1.13 at the midpoint of our revenue range. This guidance is based on the current expectations of customer demand and the continued ability to manufacture and ship products, each of which could be impacted by COVID-19, as discussed further below.
Dividend Payment
Skyworks’ Board of Directors has declared a cash dividend of $0.44 per share of the Company’s common stock, payable on June 11, 2020, to stockholders of record at the close of business on May 21, 2020.
COVID-19 Update
As announced on April 14, 2020, the company temporarily suspended their manufacturing operations in Mexicali, Mexico, under an order by the government of the state of Baja California, Mexico, to reduce the spread of the COVID-19 pandemic. After working in close collaboration with state and local officials in Mexicali, on April 27, 2020, they were permitted to resume their Mexicali operations. In resuming the Mexicali operations, they continue to employ safety protocols by applicable guidance from government officials. They did not expect that the temporary suspension of the Mexicali operations experienced in April will have a significant impact on the company’s overall business operations.
Other than the temporary suspension of manufacturing activities in Mexicali, to date, they have not experienced any significant disruptions to their ongoing operations or the supply chain as a result of the COVID-19 pandemic. In response to the pandemic, Skyworks continues to implement multiple protocols in its facilities worldwide, including social distancing, pre-shift temperature screening, enhanced use of personal protective equipment, heightened sanitation standards, and remote-work options wherever possible. Also, Skyworks continues to implement rotating shifts with reduced staffing at its various manufacturing sites. Implementation of these protective measures allows Skyworks to better safeguard employee health while simultaneously maintaining business and manufacturing operations and continuing to provide products critical to sectors deemed “essential” under the applicable laws, regulations, and orders of the jurisdictions in which the company has facilities.
