Skyworks Solutions, Inc
.
SWKS
is slated to release second-quarter fiscal 2021 results on Apr 29.
For fiscal second quarter, Skyworks expects revenues between $1.125 billion and $1.175 billion. The Zacks Consensus Estimate for fiscal second-quarter revenues is pegged at $1.15 billion, which indicates an improvement of 50.3% from the year-ago quarter.
Management expects non-GAAP earnings to be $2.34 per share at the mid-point of the guided revenue range. The consensus mark for earnings has been steady in the past 30 days at $2.34 per share, which suggests growth of 74.6% from prior-year quarter.
Skyworks Solutions, Inc. Price and EPS Surprise
Skyworks Solutions, Inc. price-eps-surprise
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Skyworks Solutions, Inc. Quote
Factors Likely to Have Influenced Q2 Performance
Ongoing momentum witnessed in Skyworks’ 5G and Wi-Fi 6 solutions is likely to have driven top-line growth in the to-be-reported quarter. Demand continues to be high owing to increased need for high-speed connectivity amid the COVID-19 induced surge in the remote work, video streaming and web-based learning trends.
Moreover, solid demand uptick for 5G handsets, especially in China, is anticipated to have driven the company’s performance in the quarter to be reported. Moreover, newly released 3GPP standards have validated the extension of 5G technology into Internet of Things (IoT), Vehicle-to-everything (V2X) and other services. This is likely to have stoked demand for Skyworks’ 5G solutions in the quarter under review.
Markedly, on Jan 13, Skyworks announced that it has reached a milestone with the shipment of more than 1 million SKY66318-21 power amplifier (PA) with a bandwidth of 200 MHz for 5G connections.
This is instilling investors’ optimism in the company’s stock. Notably, shares of Skyworks have returned 30.6% year to date, compared with the
industry
’s rise of 23.8%.
The company has also partnered with MediaTek for evolving 5G reference designs with focus on automotive and other IoT applications.
Skyworks also facilitated enhanced safety systems at Volkswagen and Toyota leveraging V2X solutions. Moreover, the company’s solutions clinched design wins at Google’s Fitbit for its newest health smartwatch.
Further, momentum in deal wins from various customers across industrial IoT, automotive, aerospace and defense verticals is anticipated to have continued in the fiscal second quarter.
In fact, Skyworks’ Wi-Fi 6 engines secured residential gateways design wins for CenturyLink’s latest GPON media gateway. The company also shipped Wi-Fi 6 solutions for access points at leading network OEMs including Cisco, NETGEAR, TP-Link and Aruba.
Moving ahead, the significant traction witnessed for Sky5 platform, which is powering smartphone launches at China-based OEMs like Oppo, Xiaomi and Vivo as well as Korea-based player Samsung, is expected to have contributed to fiscal second-quarter revenues.
Markedly, Skyworks also facilitates the touch-free point-of-sale systems at Square. Moreover, the company’s solutions support Facebook’s Oculus AR/VR devices.
Further, strong demand for the iPhone 12 family might have positively impacted revenue numbers in the quarter under review. Notably, Skyworks supplies radio frequency chips to Apple and derives a significant portion of its revenues from the company.
Growing momentum for Skyworks’ bulk acoustic wave (BAW) filters, especially in mobile and broad markets, is likely to have driven fiscal second-quarter top line. The company has been witnessing significant design wins for BAW-enabled devices.
In the medical space, Skyworks’ vital medical applications are witnessing traction, which is expected to have contributed to the top-line in the fiscal second quarter. The company’s solutions have been selected by Boston Scientific and General Electric Company.
The company also rolled out low-latency wireless audio solutions, supporting leading gaming headsets at SteelSeries and Turtle Beach.
Nonetheless, increasing expenses on product enhancements amid stiff competition from
Qorvo
QRVO
and Broadcom in the radio frequency semiconductor market is anticipated to have limited margin expansion in the fiscal second quarter.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Skyworks this time around. The combination of a positive
Earnings ESP
and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Skyworks has an Earnings ESP of +1.52% and a Zacks Rank #3, at present. You can uncover the best stocks to buy or sell before they’re reported with our
Earnings ESP Filter
.
Other Stocks to Consider
Here are some other stocks, which you may consider, as our proven model shows that these too have the right mix of elements to beat estimates this time around:
Microchip Technology Incorporated
MCHP
has an Earnings ESP of +1.44% and a Zacks Rank #2, at present. You can see
the complete list of today’s Zacks #1 Rank stocks here
.
Silicon Laboratories, Inc
.
SLAB
has an Earnings ESP of +10.79% and a Zacks Rank of 2, currently.
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