Skyworks Solutions forecast first-quarter revenue and profit below Wall Street expectations on Tuesday, signalling persistent weakness in its core smartphone business, and its shares slumped more than 14 percent in extended trading. The December quarter will be the company’s first reported as a combined business after it completed the acquisition of Qorvo following the end of its fiscal fourth quarter.
For the December quarter Skyworks expects revenue of $1.80 billion to $1.90 billion, against analysts’ estimates of about $1.99 billion, and non-GAAP diluted earnings of $1.25 a share, against estimates of about $1.52 compiled by LSEG. At the midpoint the revenue range splits into about $1.07 billion from legacy Skyworks and about $780 million from legacy Qorvo, the last quarter for which the company will give the split. The outlook is down about 7 percent sequentially from combined September revenue, or about 3 percent excluding an extra week in Qorvo’s September quarter that contributed about $70 million.
The driver is handsets. Smartphone revenue is expected to decline in the low-teens percent sequentially, reflecting seasonality, softness in the premium Android market and the extra week in the prior quarter. Diversified growth markets, by contrast, are expected to grow in the low single digits sequentially and in the high single to low double digits year over year, representing more than 40 percent of sales, led by data center and defence demand.
The reported quarter was steadier. Fiscal fourth-quarter revenue was $1.046 billion, slightly above the $1.04 billion analysts expected, with GAAP diluted earnings of $0.15 and non-GAAP earnings of $1.28 a share. Fiscal 2026 revenue was $3.96 billion. From the first quarter of fiscal 2027 Skyworks will report in two categories, Smartphone and Diversified Growth Markets.
The combination case now rests on cost. The company expects at least $500 million of annual cost savings from the Qorvo combination, about $150 million of operating expense synergies inside fiscal 2027 weighted to the second half, and an exit run rate of $250 million to $300 million by the end of fiscal 2027. That programme has to offset a handset cycle that, on today’s guidance, is still shrinking.