SKYWORKS SOLUTIONS, INC. (SWKS) Q4 2025 Earnings Summary

Executive Summary

• Skyworks delivered Q4 FY25 revenue of $1.10B and non-GAAP EPS of $1.76, exceeding the high end of guidance; GAAP EPS was $0.94 .
• Mobile strength (units and richer mix at the largest customer) and steady Broad Markets drove the beat; mobile was 65% of revenue, and the largest customer accounted for ~67% .
• Q1 FY26 guidance: revenue $975M–$1,025M, non-GAAP EPS ~$1.40 at the midpoint, gross margin 46–47%, OpEx $230–$240M, other income ~$4M, tax rate 10%, diluted shares 150.5M; Broad Markets to ~39% of sales, up slightly YoY mid-high single digits .
• Strategic catalyst: pending Qorvo combination (announced Oct 28) positions the company for scale and diversification; dividend maintained at $0.71/share (payable Dec 9) .

What Went Well and What Went Wrong

• What Went Well

  • Non-GAAP EPS and revenue beat guidance; “third straight quarter of strong execution, with revenue and non-GAAP EPS both exceeding expectations” .
  • Mobile outperformed on units and mix at the top customer, with Android growth; “a little bit of both a unit benefit and a mixed benefit” .
  • Broad Markets momentum across Wi‑Fi 7, automotive, and data center; “evolved into a more balanced and durable growth engine” and now ~$1.5B business with margins above corporate average .

• What Went Wrong

  • GAAP profitability reflects significant non-GAAP adjustments (share-based comp, amortization, restructuring, settlements) with GAAP gross margin 40.7% vs non-GAAP 46.5% in Q4 .
  • OpEx ran slightly above the high end due to higher employee incentive accruals on stronger revenue; extra week added ~$7M to OpEx in Q4 .
  • Free cash flow expected to be solid but below FY25 in FY26 as inventory tailwinds normalize and revenue base is lower .

Financial Results

Note: S&P Global consensus estimates were unavailable at time of retrieval.

Segment mix and KPIs

• Segment breakdown

  • Mobile (% of revenue): 65%
  • Broad Markets (% of revenue): implied ~35% (derived from mobile share)

• KPIs

  • Largest customer concentration: ~67% of revenue in Q4
  • Broad Markets run-rate in automotive exiting FY25: ~$65M/quarter
  • Q4 non-GAAP gross profit: $511.3M; non-GAAP gross margin: 46.5%
  • Q4 free cash flow: $144M; FY25 free cash flow: $1.1058B
  • Cash and investments: $1.388B; debt: ~$996M

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “This was our third straight quarter of strong execution, with revenue and non-GAAP EPS both exceeding expectations.” — CEO Phil Brace .
• “Internal modem adoption, added AI functionality, and higher RF complexity are expanding our opportunity inside the smartphone.” — CEO Phil Brace .
• “Broad markets have evolved into a more balanced and durable growth engine… an approximately $1.5 billion business with margins above the overall corporate average.” — CEO Phil Brace .
• “We expect revenue to be between $975 million and $1.025 billion… gross margin of approximately 46% to 47%… diluted EPS of $1.40 at the midpoint.” — CFO Philip Carter (Q1 FY26 guide) .

Q&A Highlights

• Mobile units vs mix: Strength driven by both unit upside and mix favorable to Skyworks content at largest customer; guidance comprehends prior content-loss commentary .
• Android trajectory: Focus on premium Android OEM in Mountain View valuing integration/performance; de‑emphasis of commoditized low-end .
• Broad Markets growth outlook: Management targets long‑term double‑digit growth backed by Wi‑Fi 7/8, automotive connectivity, and cloud/infrastructure timing/power .
• OpEx cadence: Q4 included an extra week (~$7M); forward OpEx guided with discipline, roughly in line with normal inflation .
• Working capital/AR/inventory: AR increase due to linearity/timing; FY26 free cash flow to be below FY25 as inventory tailwinds fade; channel inventory low .

Estimates Context

• S&P Global consensus EPS and revenue estimates for Q4 FY25 and Q1 FY26 were unavailable at time of retrieval; as a result, comparisons are shown versus company guidance only (not Street consensus).
• Implication: Analysts will likely revisit models to reflect stronger mobile mix/units and Broad Markets momentum, while incorporating Q1 guidance for mobile seasonality and a higher Broad Markets mix .

Key Takeaways for Investors

• Q4 delivered a clear beat on both revenue ($1.10B) and non-GAAP EPS ($1.76), driven by mobile units/mix and Broad Markets strength; margins held at ~46.5% non-GAAP gross and 24% non-GAAP operating .
• Near-term setup: Q1 FY26 guide implies normal mobile seasonality (low/mid-teens sequential decline) offset by slightly up Broad Markets to ~39% mix; EPS guided to ~$1.40 at the midpoint .
• Strategic optionality: Pending Qorvo deal (announced Oct 28) aims to reduce customer concentration and expand RF/analog portfolio breadth; timing/closing subject to approvals .
• Cost discipline intact: OpEx guided $230–$240M with targeted R&D; manufacturing optimization (Woburn consolidation) supports margin health .
• Automotive and Wi‑Fi franchises accelerating: Automotive run-rate ~$65M/qtr exiting FY25; Wi‑Fi 7 adoption robust with Wi‑Fi 8 programs underway .
• Balance sheet provides flexibility: $1.388B cash/investments vs ~$996M debt; dividend maintained at $0.71/share .
• Trading lens: Positive narrative on mobile mix/units and Broad Markets durability into FY26; watch for Android premium momentum, 800G timing wins, and updates on top-customer content trajectory from future selection cycles .