Skyworks Solutions, Inc. is a leading developer and manufacturer of analog and mixed-signal semiconductor products and solutions, serving a wide range of applications across various markets such as aerospace, automotive, broadband, cellular infrastructure, connected home, defense, entertainment and gaming, industrial, medical, smartphone, tablet, and wearables **[0000004127-24-000131_swks-20240927.htm:4]** **[0000004127-24-000131_swks-20240927.htm:68]**. The company markets and sells its products globally through a direct sales force, electronic component distributors, and independent sales representatives, with a significant portion of sales concentrated among a limited number of customers, including major OEMs like Apple **[0000004127-24-000131_swks-20240927.htm:10]** **[0000004127-24-000131_swks-20240927.htm:20]**. Skyworks' product offerings are not segregated for reporting purposes as they are considered similar in nature, and the company derives its revenue principally from the sale of semiconductor products **[0000004127-24-000131_swks-20240927.htm:90]**.

1. **Semiconductor Products** - Designs, develops, manufactures, and markets analog and mixed-signal semiconductor products for a variety of applications across multiple industries.
2. **High-Performance Analog Markets** - Expands into automotive, home and factory automation, data center, solar, wireless infrastructure, aerospace and defense, medical, smart energy, and wireless networking, leveraging scale and intellectual property to serve diverse markets.

25d19958aecec54f56a80328a31c62ece2ed587830d9ff11748eae1d9ee00bae

| Metric (in millions) | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 |
|----------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| United States        | **$1,028.3**  **[0000004127-23-000010_swks-20221230.htm:9]**  | **$846.6**  **[0000004127-23-000015_swks-20230331.htm:9]**  | **$793.9**  **[0000004127-23-000025_swks-20230630.htm:9]**  | **$969.2**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$969.2**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$795.1**  **[0000004127-24-000019_swks-20240329.htm:9]**  | **$658.5**  **[0000004127-24-000070_swks-20240628.htm:9]**  | **$3,202.2**  **[0000004127-24-000131_swks-20240927.htm:89]**  |
| China                | **$106.3**  **[0000004127-23-000010_swks-20221230.htm:9]**  | **$89.0**  **[0000004127-23-000015_swks-20230331.htm:9]**  | **$81.6**  **[0000004127-23-000025_swks-20230630.htm:9]**  | **$79.9**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$79.9**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$76.9**  **[0000004127-24-000019_swks-20240329.htm:9]**  | **$75.9**  **[0000004127-24-000070_swks-20240628.htm:9]**  | **$303.4**  **[0000004127-24-000131_swks-20240927.htm:89]**  |
| Taiwan               | **$85.6**  **[0000004127-23-000010_swks-20221230.htm:9]**  | **$85.2**  **[0000004127-23-000015_swks-20230331.htm:9]**  | **$81.2**  **[0000004127-23-000025_swks-20230630.htm:9]**  | **$71.3**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$71.3**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$74.1**  **[0000004127-24-000019_swks-20240329.htm:9]**  | **$80.7**  **[0000004127-24-000070_swks-20240628.htm:9]**  | **$317.5**  **[0000004127-24-000131_swks-20240927.htm:89]**  |
| South Korea          | **$35.8**  **[0000004127-23-000010_swks-20221230.htm:9]**  | **$55.8**  **[0000004127-23-000015_swks-20230331.htm:9]**  | **$48.1**  **[0000004127-23-000025_swks-20230630.htm:9]**  | **$45.6**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$45.6**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$59.7**  **[0000004127-24-000019_swks-20240329.htm:9]**  | **$52.9**  **[0000004127-24-000070_swks-20240628.htm:9]**  | **$203.9**  **[0000004127-24-000131_swks-20240927.htm:89]**  |
| Europe, Middle East, and Africa | **$54.1**  **[0000004127-23-000010_swks-20221230.htm:9]**  | **$58.7**  **[0000004127-23-000015_swks-20230331.htm:9]**  | **$51.3**  **[0000004127-23-000025_swks-20230630.htm:9]**  | **$27.1**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$27.1**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$29.2**  **[0000004127-24-000019_swks-20240329.htm:9]**  | **$31.3**  **[0000004127-24-000070_swks-20240628.htm:9]**  | **$114.5**  **[0000004127-24-000131_swks-20240927.htm:89]**  |
| Other Asia-Pacific   | **$19.2**  **[0000004127-23-000010_swks-20221230.htm:9]**  | **$17.8**  **[0000004127-23-000015_swks-20230331.htm:9]**  | **$15.1**  **[0000004127-23-000025_swks-20230630.htm:9]**  | **$8.4**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$8.4**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$11.0**  **[0000004127-24-000019_swks-20240329.htm:9]**  | **$6.2**  **[0000004127-24-000070_swks-20240628.htm:9]**  | **$36.5**  **[0000004127-24-000131_swks-20240927.htm:89]**  |
| Total Net Revenue    | **$1,329.3**  **[0000004127-23-000010_swks-20221230.htm:9]**  | **$1,153.1**  **[0000004127-23-000015_swks-20230331.htm:9]**  | **$1,071.2**  **[0000004127-23-000025_swks-20230630.htm:9]**  | **$1,201.5**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$1,201.5**  **[0000004127-24-000007_swks-20231229.htm:10]**  | **$1,046.0**  **[0000004127-24-000019_swks-20240329.htm:9]**  | **$905.5**  **[0000004127-24-000070_swks-20240628.htm:9]**  | **$4,178.0**  **[0000004127-24-000131_swks-20240927.htm:89]**  |

5dda7fa12a48d1e383de4d9ef7549f4052335e77057e25c599e0f68997cbdedc

1. Despite reducing internal inventory for seven consecutive quarters, you anticipate gross margins to remain flat in fiscal '25; can you explain why margins aren't improving significantly and what specific actions you're taking to enhance profitability?
2. With your largest customer accounting for approximately 69% of total revenue and showing strong sequential growth, how do you plan to mitigate the risks associated with high customer concentration and diversify your revenue base?
3. Given your underrepresentation at Samsung and the shifting sands in the RFFE space, what are you doing differently to capture more market share with Samsung, and when can we expect to see tangible results from these efforts?
4. Considering your strong free cash flow and substantial cash on the balance sheet, why hasn't there been a more aggressive approach to share repurchases, and how are you balancing potential M&A opportunities with returning capital to shareholders?
5. You've mentioned continued under-shipment to natural demand in key areas like networking infrastructure, cloud, automotive, and industrial markets; what strategies are you implementing to address this mismatch and accelerate growth in these segments?

de31a735d7105adf7d71100ee51fdfefeb768f0f229855fa456a0a98b2ee576e

Total Revenue (USD, millions)

Cost of Goods Sold (COGS) (USD, millions)

SG&A (USD, millions)

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D&A (USD, millions)

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Operating Income (EBIT) (USD, millions)

Net Income (USD, millions)

EPS - Basic (USD/share)

EPS - Diluted (USD/share)

a9fb65b7cc67a8bfaaa2bea07821201ae85266c528ea23cc5c99d20fa3ca3912

Adjustments for Non-Cash Items (USD, millions)

Stock-Based Compensation (USD, millions)

Changes in Working Capital (USD, millions)

Capital Expenditures (USD, millions)

Proceeds from / Repayments of Debt (USD, millions)

Share Repurchases (USD, millions)

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3f872c14517e4933bcd0b05f40c3ac18f5003f1c8adb7fe67cca79e4e5084313

United States

China

Taiwan

South Korea

Europe, Middle East, and Africa

Other Asia-Pacific

Other Americas

Total Americas

Total Asia-Pacific

Total Revenue

3ddc40e55b2e727647b7919e1fe7d5fda03f200feba0739d0034106821d9afa3

- Analog Devices
- Broadcom
- Cirrus Logic
- Murata Manufacturing
- NXP Semiconductors
- Qorvo
- Qualcomm
- Texas Instruments

These companies are mentioned as competitors in the wireless communications semiconductor industry and other analog markets, which are characterized by significant competition, pricing pressures, and rapid loss of market share  **[0000004127-24-000131_swks-20240927.htm:30]** .

13ae1b7b6172b875548c3327ffa312cde9eae2ee0748f45a35ea4efd57f26344

### Q4 2024 Earnings Call
- **Issued Period**: Q4 2024
- **Guided Period**: Q1 2025
- **Guidance**:
  - **Revenue**: $1.050 billion to $1.080 billion
  - **Gross Margin**: 46% to 47%
  - **Operating Expenses**: $209 million to $215 million
  - **Other Income**: $3 million
  - **Effective Tax Rate**: 12.5%
  - **Diluted Share Count**: Approximately 160 million shares
  - **Diluted Earnings Per Share**: $1.57 at the midpoint of the revenue range  **[SWKS_3407891_2]** .

### Q3 2024 Earnings Call
- **Issued Period**: Q3 2024
- **Guided Period**: Q4 2024
- **Guidance**:
  - **Revenue**: $1 billion to $1.04 billion
  - **Mobile Business**: Up approximately 20% sequentially
  - **Broad Markets**: Modest improvements, representing three consecutive quarters of sequential growth
  - **Gross Margin**: 46% to 47%, increasing 50 basis points sequentially at the midpoint
  - **Operating Expenses**: $197 million to $203 million
  - **Other Income**: $3 million
  - **Effective Tax Rate**: 12%
  - **Diluted Share Count**: Approximately 161 million shares
  - **Diluted Earnings Per Share**: $1.52 at the midpoint of the revenue range  **[SWKS_3395048_3]** .

### Q2 2024 Earnings Call
- **Issued Period**: Q2 2024
- **Guided Period**: Q3 2024
- **Guidance**:
  - **Revenue**: $900 million, plus or minus 2%
  - **Gross Margin**: 45% to 47%, improving 100 basis points sequentially at the midpoint
  - **Operating Expenses**: $192 million to $198 million
  - **Other Income**: $2 million
  - **Effective Tax Rate**: 11.5%
  - **Diluted Share Count**: Approximately 161.5 million shares
  - **Diluted Earnings Per Share**: $1.21 at the midpoint of the revenue range  **[SWKS_3381567_3]** .

### Q1 2024 Earnings Call
- **Issued Period**: Q1 2024
- **Guided Period**: Q2 2024
- **Guidance**:
  - **Revenue**: $1.2 billion to $1.7 billion
  - **Gross Margin**: 45% to 46%
  - **Operating Expenses**: $193 million to $197 million
  - **Other Expense**: $4 million
  - **Effective Tax Rate**: 11.5%
  - **Diluted Share Count**: Approximately 161 million shares
  - **Diluted Earnings Per Share**: $1.52 at the midpoint of the revenue range  **[SWKS_3371149_0]** .

0314b3320539c1ebd0ad44926a960ad43f9971a42213557761f7595ca6580cd7

| Name            | Position                                      | Start Date | Short Bio                                                                                                                                                                                                 |
|-----------------|-----------------------------------------------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Liam K. Griffin | Chairman, Chief Executive Officer, and President | May 2016   | Liam K. Griffin has been serving as a director since **May 2016** and was appointed as Chairman of the Board in **May 2021**. He joined Skyworks in **August 2001** and has held various leadership roles  **[0000004127-24-000002_swks-20230929.htm:2]** **[0001104659-24-040560_tm242679-d5_def14a.htm:10]** **[0001104659-24-035021_tm242679d2_pre14a.htm:10]** . |
| Kris Sennesael  | Senior Vice President and Chief Financial Officer | August 2016 | Kris Sennesael joined Skyworks in **August 2016**. Before Skyworks, he was CFO at Enphase Energy, Inc. and held financial positions at other companies  **[0000004127-24-000002_swks-20230929.htm:6]** **[0000004127-23-000005_swks-20220930.htm:5]** .                                                                                   |
| Reza Kasnavi    | Senior Vice President, Technology and Manufacturing | November 2019 | Reza Kasnavi joined Skyworks in **2010** and has served as Senior Vice President, Technology and Manufacturing since **November 2019**. He previously worked at Tallwood Venture Capital  **[0000004127-24-000002_swks-20230929.htm:6]** .                                                    |
| Carlos S. Bori  | Senior Vice President, Sales and Marketing     | November 2017 | Carlos S. Bori joined Skyworks in **July 2013** and has served as Senior Vice President, Sales and Marketing since **November 2017**. He previously worked at Beacon Electronic Associates  **[0000004127-24-000002_swks-20230929.htm:6]** **[0000004127-23-000005_swks-20220930.htm:5]** .                                               |
| Robert J. Terry | Senior Vice President, General Counsel and Secretary | November 2017 | Robert J. Terry joined Skyworks in **2003** and has served as Senior Vice President, General Counsel, and Secretary since **November 2017**. He previously worked at Day Software, Inc.  **[0000004127-24-000002_swks-20230929.htm:6]** .                                                      |

0e311d875b537b0ceb6f90b5d39f804fed5d2e0481b8f178ac1e6482c43eeab6

1. **Largest Customer Confidence**  
   **Q:** Are you losing content at your largest customer in H2?  
   **A:** They have a **great position with their largest customer**, with no concerns about content loss, and will continue to drive success together \[0\].

2. **Gross Margin Recovery**  
   **Q:** When will gross margins return to 50%?  
   **A:** Gross margins are expected to improve after March, aiming to reach **50%** as soon as possible and ultimately targeting **53%** long-term. This will come from revenue growth, better factory utilization, and continued cost efficiencies \[0\].

3. **Android Market Growth**  
   **Q:** Can we expect growth in the Android market this year?  
   **A:** Seeing **green shoots** in Android, they anticipate more growth as new phones with advanced technology emerge, expecting continuing strength through 2024 and 2025 \[0\].

4. **Broad Markets Recovery Pace**  
   **Q:** How quickly will broad markets recover from inventory correction?  
   **A:** Believing December marked the bottom, they expect **sequential growth starting in March**, with varying recovery rates across IoT, infrastructure, and automotive segments \[0\].

5. **Android Revenue Rebound**  
   **Q:** Will Android revenues bounce back to previous levels?  
   **A:** Confident in opportunities within Android, they expect to **return to previous revenue levels**, leveraging their technology and manufacturing scale to grow this segment \[0\].

6. **Gross Margin Drivers**  
   **Q:** What will drive gross margin improvement?  
   **A:** Improvements will come from higher factory utilization as inventory reduction ends, a favorable mix from faster broad markets growth, and cost reductions both internally and externally \[0\].

7. **Operating Expense Outlook**  
   **Q:** How will OpEx trend this year?  
   **A:** Operating expenses were **$191 million** in Q1 and are projected to rise to **$195 million** in March due to calendar resets and ongoing investments, with gradual increases expected throughout the year \[0\].

8. **AI in Smartphones**  
   **Q:** How will AI in smartphones impact growth?  
   **A:** AI in smartphones is seen as a **secular opportunity**, leading to increased RF content due to demands for higher performance and lower latency, which they are well-positioned to address \[0\].

9. **Cash Flow and M&A**  
   **Q:** Any plans for M&A to boost broad markets?  
   **A:** With strong cash flow and a net positive cash position, they are considering M&A to accelerate diversification, focusing on opportunities that align with their strategy to become a more diverse company \[0\].

10. **China Competitive Landscape**  
    **Q:** Are you seeing changes in China RF competition?  
    **A:** While acknowledging competition in the low-end market, they focus on mid and high-end segments in China, which are more profitable, and remain committed to their current strategy \[0\].

11. **Data Center Opportunities**  
    **Q:** How does AI workload impact data center growth?  
    **A:** AI-driven workloads increase demand for high-speed connectivity in data centers, where their timing solutions and infrastructure products offer significant growth potential \[0\].

12. **Revenue from Largest Customer**  
    **Q:** What was the revenue mix from your largest customer?  
    **A:** The largest customer accounted for approximately **73% of total revenue** in the December quarter, a seasonal peak, and this percentage is expected to decrease in subsequent quarters \[0\].

cc23f2a6a4298ce2dcc96e3569149e66e8cf1330aead9d288b579bd006c554c4

733efe055fd36f98352ae42b4ba59199f2c6362adbe5487f548745f24c72fd40

| Program Details          | Program 1          |
|--------------------------|--------------------|
| Approval Date            | January 31, 2023  **[0000004127-24-000131_swks-20240927.htm:83]** **[0000004127-24-000131_swks-20240927.htm:49]**  |
| End Date/Duration        | February 1, 2025  **[0000004127-24-000131_swks-20240927.htm:83]** **[0000004127-24-000131_swks-20240927.htm:49]**  |
| Total additional amount  | **$2.0 billion**  **[0000004127-24-000131_swks-20240927.htm:83]** **[0000004127-24-000131_swks-20240927.htm:49]**  |
| Remaining authorization  | **$1.9 billion** as of September 27, 2024  **[0000004127-24-000131_swks-20240927.htm:83]** **[0000004127-24-000131_swks-20240927.htm:49]**  |
| Details                  | Repurchase shares on the open market or in privately negotiated transactions. The program may be suspended or discontinued at any time.  **[0000004127-23-000015_swks-20230331.htm:13]** **[0000004127-24-000070_swks-20240628.htm:14]** **[0000004127-24-000131_swks-20240927.htm:83]** **[0000004127-23-000030_swks-20230929.htm:79]**  |

6436cd561657c228b1449e6b8064f23679475b3f9dc336f44d78bb07e32ccec0

**Quarterly guidance for Q1 2025:**
- **Revenue**: $1.050B to $1.080B  **[SWKS_3407891_2]**  (raised from $1.0B to $1.04B  **[SWKS_3395048_3]** )  
- **Gross Margin**: 46% to 47%  **[SWKS_3407891_2]**  (no change from prior guidance  **[SWKS_3395048_3]** )  
- **Operating Expenses**: $209M to $215M  **[SWKS_3407891_2]**  (raised from $197M to $203M  **[SWKS_3395048_3]** )  
- **Other Income**: $3M  **[SWKS_3407891_2]**  (no change from prior guidance  **[SWKS_3395048_3]** )  
- **Effective Tax Rate**: 12.5%  **[SWKS_3407891_2]**  (raised from 12%  **[SWKS_3395048_3]** )  
- **Diluted Share Count**: ~160M shares  **[SWKS_3407891_2]**  (lowered from ~161M shares  **[SWKS_3395048_3]** )  
- **Diluted Earnings Per Share**: $1.57 at the midpoint  **[SWKS_3407891_2]**  (raised from $1.52 at the midpoint  **[SWKS_3395048_3]** )  

591beeb273b18a26d38fd6b135ce33a1ec4b11657d031838263994167dc452a8

| Name       | Start Date | End Date | Reason for Change |
|------------|------------|----------|-------------------|
| KPMG LLP   | 2002  **[0000004127-24-000131_swks-20240927.htm:63]**    | Present  | Current auditor   |

a0f4101a71f3224d0bcc2deba595ea3c2e34c0f96bf0e432c0f634f1d2e24002

9e30fe26aad9ac37b99999a1ecd8d159af11ed2c86e4e36fc1c0f38b2d8d0014

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

7e789055d755906c915172e70c17c0b41b719e7afee21cb21dfbe3ca99896a6a

- Total Revenue: $1,025 million (−16% YoY)  **[0000004127-23-000030_swks-20230929.htm:59]** **[0000004127-24-000131_swks-20240927.htm:63]**   
- Operating Income: $59.4 million (**−77%** YoY)  **[0000004127-23-000030_swks-20230929.htm:59]** **[0000004127-24-000131_swks-20240927.htm:63]**   
- Net Income: $60.5 million (**−75%** YoY)  **[0000004127-23-000030_swks-20230929.htm:59]** **[0000004127-24-000131_swks-20240927.htm:63]**   
- Diluted EPS: $0.37 (**−76%** YoY)  **[0000004127-23-000030_swks-20230929.htm:59]** **[0000004127-24-000131_swks-20240927.htm:63]**   
- United States Revenue: $779.4 million (−17% YoY)  **[0000004127-23-000030_swks-20230929.htm:84]** **[0000004127-24-000131_swks-20240927.htm:89]**   
- South Korea Revenue: $45.7 million (−22% YoY)  **[0000004127-23-000030_swks-20230929.htm:84]** **[0000004127-24-000131_swks-20240927.htm:89]**   
- EMEA Revenue: $26.9 million (−33% YoY)  **[0000004127-23-000030_swks-20230929.htm:84]** **[0000004127-24-000131_swks-20240927.htm:89]**   

36a7673ae733211b21008594ffed528d80851eae82510b14b8e7336d155baaf0

| Year | Amount Due (Millions) | Debt Type       | Interest Rate (%) | % of Total Debt                     |
|----------|---------------------------|---------------------|-----------------------|------------------------------------------|
| 2026     | 500.0 **[0000004127-24-000131_swks-20240927.htm:77]**             | 1.80% Senior Notes  | 1.80 **[0000004127-24-000131_swks-20240927.htm:77]**          | 50.3% = (500.0 / 994.3) * 100 **[0000004127-24-000131_swks-20240927.htm:77]**    |
| 2031     | 500.0 **[0000004127-24-000131_swks-20240927.htm:77]**             | 3.00% Senior Notes  | 3.00 **[0000004127-24-000131_swks-20240927.htm:77]**          | 50.3% = (500.0 / 994.3) * 100 **[0000004127-24-000131_swks-20240927.htm:77]**    |

5f3eeb2531a5f8fdf22dc5135783f395a4862c6ac03905c1e57b8c5e42c1fe15

33aaabf0aa0e110141f54d9edb711747e0527b5fc6755c9e4dc14a4eae07a963

- **High Customer Concentration Risk**: Skyworks' largest customer accounted for approximately **65% of total revenue** in the June quarter and is expected to be slightly above 65% in September.  **[SWKS_3395048_8]**  This heavy reliance poses a significant risk if the customer reduces orders or switches to internal solutions.
- **Persistent Excess Inventory in Key Markets**: Excess inventory remains a challenge in certain segments, particularly in automotive, industrial, infrastructure, networking, and data center markets, which is **prolonging the recovery** as Skyworks continues to under-ship natural demand.  **[SWKS_3395048_16]** **[SWKS_3395048_6]**
- **Limited Current Exposure to AI Opportunities Beyond Smartphones**: While Skyworks acknowledges the potential of AI in IoT and other markets, the company **"just hasn't gotten there yet"** and is still making investments to capitalize on these opportunities.  **[SWKS_3395048_14]**

136c5964ab7362cbbc4375f853163d03aab9a7a813b7560234bbe5b640681493

- **Strong Growth Expected in Broad Markets Business**: Skyworks anticipates an acceleration of sequential growth in its broad markets segment, aiming for **double-digit year-over-year growth** in upcoming quarters.  **[SWKS_3381567_14]**
- **Android Business Stabilizing with Growth Potential**: The Android business is approaching **$100 million per quarter**, with ambitions to reach **$125 million to $150 million**, driven by strong relationships with **Samsung and Google**.  **[SWKS_3381567_18]**
- **Positive Outlook in Automotive and Industrial Segments**: Despite near-term headwinds, Skyworks sees opportunities for long-term growth in **automotive**, especially with the ramp of **connectivity in cars** and **power isolation products for EVs**.  **[SWKS_3381567_15]** **[SWKS_3381567_16]**

741f9062685bca797b63f58ed484e8ecb2b6a044288df6e50e09e35b680b1e01

1. **Largest Customer Revenue**  
   **Q:** How did revenue from your largest customer perform, and what's the outlook?  
   **A:** Our largest customer contributed approximately **69% of total revenue** in the September quarter, which was **up 21% sequentially**.  **[SWKS_3407891_6]**  We expect revenue from this customer to increase further by **5% to 10% sequentially** in the December quarter, fully in line with our expectations.  **[SWKS_3407891_7]** 

2. **Gross Margin Outlook**  
   **Q:** What's the outlook for gross margin expansion in fiscal 2025?  
   **A:** We reported a gross margin of **46.5%** in September, up **50 basis points** sequentially.  **[SWKS_3407891_12]**  We expect gross margins to remain **flattish in fiscal 2025**, starting to improve toward the end of the year as factory utilization improves and broad markets accelerate.  **[SWKS_3407891_12]**  Our long-term goal is to return to **50% gross margin** and ultimately reach our target model of **53%**.  **[SWKS_3407891_12]** 

3. **Broad Markets Business**  
   **Q:** Can you discuss the sustainability of the recovery in broad markets into 2025?  
   **A:** Our broad markets business bottomed in December 2023 and has seen **modest sequential growth** for three quarters.  **[SWKS_3407891_4]**  We are guiding to further modest growth in the December quarter and expect a return to **mid-single-digit year-over-year growth**.  **[SWKS_3407891_4]**  While inventory corrections persist in automotive, industrial, infrastructure, and networking, we anticipate sequential growth to accelerate as these clear.  **[SWKS_3407891_4]** 

4. **Capital Returns and Free Cash Flow**  
   **Q:** With strong free cash flow, how do you plan to return capital to shareholders?  
   **A:** We generated over **$1.6 billion** in free cash flow for the second consecutive year.  **[SWKS_3407891_8]**  Our balance sheet is robust, with **$1.6 billion in cash** and only **$1 billion in debt**.  **[SWKS_3407891_8]**  We recently increased our dividend by **3% to $0.70 per share**  **[SWKS_3407891_8]** , and while we consider multiple factors, it's our intent to continue returning excess cash to shareholders over time.  **[SWKS_3407891_8]** 

5. **Android Business Growth**  
   **Q:** What's your outlook for the Android business, specifically with Google and Samsung?  
   **A:** We have a **robust pipeline** with Android players, particularly **Google and Samsung**.  **[SWKS_3407891_3]**  Half of our Android revenue comes from Google, and 30–40% from Samsung.  **[SWKS_3407891_3]**  We're seeing strong design wins and opportunities to demonstrate our technology reach and scale.  **[SWKS_3407891_3]** 

6. **WiFi 7 Upgrade Cycle**  
   **Q:** How is the WiFi 7 upgrade cycle impacting your business?  
   **A:** We're in a great position with **WiFi 7**, working with companies like **Motorola, Logitech, NETGEAR, and Mercedes-Benz**.  **[SWKS_3407891_10]**  The design win pipeline is filling, and we're encouraged by the signs we're seeing as we transition from WiFi 6 to WiFi 6E and 7.  **[SWKS_3407891_10]** 

7. **Impact of AI on Business**  
   **Q:** How is AI influencing your business across different segments?  
   **A:** In smartphones, we're deeply entrenched with key customers, collaborating on AI-enabled devices.  **[SWKS_3407891_15]**  In broad markets, we're seeing opportunities in **AI data centers and networking**, where we provide timing solutions.  **[SWKS_3407891_4]** **[SWKS_3407891_17]**  Companies like **Google** are investing in AI-enabled phones, driving complexity that plays to our strengths.  **[SWKS_3407891_3]** 

8. **CapEx and Investment Plans**  
   **Q:** What are your capital expenditure expectations for fiscal 2025?  
   **A:** CapEx in fiscal 2024 was about **3% of revenue**, the lowest in many years.  **[SWKS_3407891_16]**  Going forward, we expect CapEx to remain moderate, in the **mid-single digits as a percent of revenue**, focusing on technology investments.  **[SWKS_3407891_16]** 

9. **M&A Considerations**  
   **Q:** Are you considering mergers and acquisitions given the favorable environment?  
   **A:** We have plenty of optionality with our strong cash flow and healthy balance sheet.  **[SWKS_3407891_14]**  While we remain disciplined, we're always looking for optimal opportunities, whether through **M&A** or other means to enhance shareholder value.  **[SWKS_3407891_14]** 

10. **Impairment Charge Details**  
    **Q:** Can you provide details on the recent impairment charge?  
    **A:** We took an impairment charge in Q4 fiscal 2024 related to **in-process R&D** from the **I&A acquisition with Silicon Labs**.  **[SWKS_3407891_16]**  Changes in project timelines and definitions can result in such charges. Despite inventory corrections in the industrial automotive area, we're pleased with this business's technology and customer relationships.  **[SWKS_3407891_16]** 

07ab3a3bb1c22da7e4defca05adbe62929e38a2dbec06e487238c3a050f4e954

- Skyworks is **seeing strong demand acceleration**, particularly in their **mobile business**, expecting revenue of **$1.0 billion to $1.04 billion** for Q4 2024, with the **mobile business up approximately 20% sequentially** as **demand and supply patterns normalize**.  **[SWKS_3395048_3]** ,  **[SWKS_3395048_8]**
- The company is **well-positioned to benefit from the proliferation of AI** into smartphones and IoT devices, which will **drive higher RF complexity and increased content per device**; they are leveraging their **unique technologies** and **deep customer relationships**, especially in **AI-enabled smartphones**, with **great partnerships with leading Android OEMs like Samsung and Google**.  **[SWKS_3395048_5]** ,  **[SWKS_3395048_4]** ,  **[SWKS_3395048_11]** ,  **[SWKS_3395048_18]** ,  **[SWKS_3395048_14]**
- Skyworks continues to **generate robust cash flow**, with **$1.3 billion of free cash flow** year-to-date (a **40% free cash flow margin**), and has a **strong balance sheet** with **$1.3 billion in cash** and only **$1.0 billion in debt**; they are **returning cash to shareholders** through dividends, including a recent **3% dividend increase to $0.70 per share** (a **2.4% dividend yield**), and **share repurchases**.  **[SWKS_3395048_3]** ,  **[SWKS_3395048_13]**

ce4f6b7d30ed7a91610341f7e05e189dcac76a371d58659947ebb4727cde5e0d

1. **Socket Loss with Largest Customer**  
   **Q:** Was the content loss with your largest customer significant?  
   **A:** Yes, we were unable to secure an expected award with our largest customer, leading to content headwinds in the upcoming cycle. We partially offset this socket loss with additional content gains, including new sockets not in the current phone. Overall, we expect content to be down a little more than **10%** compared to the current model, impacting revenue starting in the September quarter.  **[SWKS_3381567_7]** **[SWKS_3381567_8]** 

2. **Mobile Inventory Clearance**  
   **Q:** When will mobile inventory headwinds be cleared?  
   **A:** We experienced excess inventory due to lower-than-expected demand in March and April. We expect to clear this excess inventory during the June quarter.  **[SWKS_3381567_4]** **[SWKS_3381567_5]** **[SWKS_3381567_22]** **[SWKS_3381567_23]** 

3. **Impact on Second Half Outlook**  
   **Q:** Will inventory issues affect the second half of the year?  
   **A:** We believe most inventory clearance will be completed in the June quarter. From a demand perspective, this is a short-term issue, and we do not anticipate inventory headwinds persisting into the second half.  **[SWKS_3381567_5]** **[SWKS_3381567_6]** **[SWKS_3381567_22]** **[SWKS_3381567_23]** 

4. **Gross Margin Improvement**  
   **Q:** How will gross margins trend in upcoming quarters?  
   **A:** Gross margins improved by **100 basis points** sequentially in June guidance, and we expect further improvements throughout 2024 and beyond. This will be driven by cost reductions, a favorable mix shift to broad markets, and improved factory utilization as revenues grow.  **[SWKS_3381567_11]** **[SWKS_3381567_12]** 

5. **Broad Markets Growth Outlook**  
   **Q:** What is the outlook for the broad markets segment?  
   **A:** Broad markets showed modest sequential growth in March and June. We expect acceleration in sequential growth in coming quarters, leading to strong double-digit year-over-year growth as inventory levels normalize and demand increases across automotive, industrial, and IoT segments.  **[SWKS_3381567_15]** **[SWKS_3381567_16]** **[SWKS_3381567_19]** 

6. **Android Business Stability**  
   **Q:** How is the Android business performing?  
   **A:** Our Android business has been stabilizing, approaching **$100 million** per quarter. While June is seasonally weaker, we anticipate meaningful year-over-year growth over the next 4 to 8 quarters, supported by design wins and improving end-customer demand.  **[SWKS_3381567_14]** **[SWKS_3381567_18]** 

7. **Engagement with Huawei**  
   **Q:** Are you engaging with Huawei given their market success?  
   **A:** We are still not engaged with Huawei. The product quality does not meet our standards, and the environment remains challenging.  **[SWKS_3381567_20]** 

8. **AI Impact on Future Products**  
   **Q:** How will AI in smartphones impact your business?  
   **A:** The integration of AI into smartphones will increase compute power and data demands, requiring advanced RF solutions. This presents opportunities for us to create new, power-efficient technologies, potentially driving revenue growth as the smartphone market upgrades.  **[SWKS_3381567_10]** **[SWKS_3381567_21]** 

9. **CapEx and Capacity Outlook**  
   **Q:** How does lower CapEx affect future growth opportunities?  
   **A:** After significant investments in prior years, we're focusing on operational efficiencies to create additional capacity without substantial CapEx. With current underutilized factories, we can substantially grow revenue, supporting strong free cash flow.  **[SWKS_3381567_11]** 

10. **China Mobile Revenue**  
    **Q:** What is the outlook for China mobile revenue?  
    **A:** China mobile revenue remains minimal but is improving each quarter. We have strong relationships with major players and expect meaningful year-over-year growth in fiscal 2025 as design wins accumulate and end-customer demand strengthens.  **[SWKS_3381567_17]** 

85b6d9c7d623753ef1148ecf7b837ed862280df09e51c571c24cb249dd006440

- **Recovery and anticipated growth in the Android market**, signaling increasing revenue opportunities for Skyworks. Liam Griffin stated, "**We see green shoots here popping up...you should expect more growth in the Android ecosystem as we go forward.**"  **[SWKS_3371149_3]**
- **Broad Markets segment expected to recover and grow**, providing additional revenue streams and diversification. Liam Griffin mentioned, "**We definitely believe there's going to be more acceleration in revenue in the broad markets...we do think there's a turn.**"  **[SWKS_3371149_15]**  He also emphasized the **significant room to grow within their broad markets accounts.**  **[SWKS_3371149_15]**
- **Strong cash flow generation enables strategic investments**, including potential M&A to accelerate diversification and growth in Broad Markets. Kris Sennesael highlighted, "**We will continue to drive a very strong free cash flow...we have optionality. We can switch on the buybacks or we can be active from an M&A point of view.**"  **[SWKS_3371149_13]**

d467e76edebb1b04d8196de3920b980cd7b4b86b09f6dd59266e3c557eab190a

- **69% of Skyworks' revenue comes from its largest customer**, indicating a high customer concentration risk.  **[SWKS_3407891_6]**
- The company is experiencing **persistent excess inventory** in its networking infrastructure and cloud segment, which will **take multiple quarters to work down**, leading to **shipping way under natural demand**.  **[SWKS_3407891_11]**
- There is **muted global demand** in automotive and industrial markets as Tier 1s and OEMs work down excess inventory, resulting in **near-term headwinds** for Skyworks.  **[SWKS_3407891_1]** **[SWKS_3407891_11]**

f29816aa011bc2cc03d8ea5c60f817a20886e8b33b6ac558e38c27c828ede329

- **Strong partnerships with major Android players like Google and Samsung are driving new design wins and opportunities, especially in AI-enabled smartphones**, which demand higher RF complexity and align with Skyworks' technology strengths.  **[SWKS_3407891_20]** **[SWKS_3407891_3]**
- **Improving trends in broad markets**, particularly in **Edge IoT connectivity**, where adoption of **WiFi 6E and WiFi 7** systems is increasing demand due to higher complexity and additional bands, leading to higher dollar content per device.  **[SWKS_3407891_11]** **[SWKS_3407891_15]**
- **Robust free cash flow generation exceeding $1.6 billion for the second consecutive year**, a **healthy balance sheet** with **$1.6 billion in cash** and **$1 billion in debt**, and an increased dividend to **$0.70 per share**, providing flexibility for investments, M&A, and returning excess cash to shareholders.  **[SWKS_3407891_8]**

e3ed3cec555d6fe313520e713310bcc7e40ad1879609246f226eb8e496a01c31

1. **Gross Margin Improvement**  
   **Q:** What's the outlook for gross margins?  
   **A:** Kris Sennesael indicated that March was the bottom at **45% gross margin**.  **[SWKS_3395048_7]**  They observed **100 basis points improvement in the June quarter** and guided another **50 basis points improvement for the September quarter**.  **[SWKS_3395048_7]**  Further improvements are expected in the December quarter and beyond, driven by cost reductions, better factory utilization, higher-value products, and favorable mix as broad markets grow.  **[SWKS_3395048_7]** **[SWKS_3395048_13]** 

2. **Impact of AI on Revenue Growth**  
   **Q:** How will AI affect future revenue and content opportunities?  
   **A:** Liam Griffin emphasized that they are beginning to engage in AI, seeing it as a **major catalyst for smartphones**.  **[SWKS_3395048_5]**  They are dealing with challenges like higher MIMO levels, carrier aggregation, and new frequency bands, which align with their technological strengths.  **[SWKS_3395048_10]** **[SWKS_3395048_12]** **[SWKS_3395048_18]**  Griffin believes this will lead to a significant and long-term cycle in mobile, similar to the first 5G cycle, with opportunities for customized solutions and substantial content gains.  **[SWKS_3395048_12]** **[SWKS_3395048_18]** 

3. **Largest Customer Revenue Trend**  
   **Q:** How is revenue from your largest customer trending?  
   **A:** Kris Sennesael reported that the largest customer accounted for approximately **65% of total revenue in the June quarter**, down sequentially due to inventory buildup.  **[SWKS_3395048_8]**  For September, they expect the largest customer to be slightly above **65% of total revenue**, with revenue up around **20% sequentially** as they support new product ramps.  **[SWKS_3395048_8]** 

4. **Inventory Correction and Broad Markets Outlook**  
   **Q:** What's the status of inventory correction in broad markets?  
   **A:** Kris Sennesael mentioned that broad markets hit the bottom in the December quarter and have seen **two consecutive quarters of sequential growth**, with further growth expected in September.  **[SWKS_3395048_6]**  Inventory correction is mostly over in consumer enterprise, while automotive and industrial markets still experience ongoing correction.  **[SWKS_3395048_6]**  They have strong design win momentum and expect to return to year-over-year growth in broad markets.  **[SWKS_3395048_6]** 

5. **Use of Cash and Capital Allocation**  
   **Q:** How do you plan to use cash and capital?  
   **A:** Kris Sennesael highlighted that they generated **$1.3 billion of cash** in the first nine months, with a **40% free cash flow margin**, and have a strong balance sheet with **$1.3 billion in cash** and **$1 billion in debt**.  **[SWKS_3395048_13]**  They will continue investing in the business and return excess cash to shareholders through dividends and share buybacks. They announced a **3% dividend increase to $0.70 per share** and restarted the buyback program in the June quarter.  **[SWKS_3395048_13]** 

6. **Android Market Opportunities**  
   **Q:** What's your outlook for the Android market?  
   **A:** Liam Griffin stated they are actively engaged with Android, specifically with **Samsung and Google**, noting that the **Pixel phone is an amazing product**.  **[SWKS_3395048_11]**  They see significant opportunities at the higher end of Android and believe there's more they can do, focusing less on the low-end market in China.  **[SWKS_3395048_11]** 

1a847d937d66c54e9fb84ee66befcc36f455ae63cf069852fae6bd2127db470c

- **Heavy Reliance on a Single Customer**: Skyworks' largest customer accounted for approximately **73% of total revenue** in the December quarter, which is considered high.  **[SWKS_3371149_8]**  This concentration exposes the company to significant risk if there are any reductions in orders or loss of content from this customer.
- **Declining Gross Margins Due to Underutilization**: The company is experiencing declining gross margins due to **lower factory utilization** and **underutilization charges** resulting from reduced production to manage inventory levels.  **[SWKS_3371149_14]**  Gross margin guidance for the March quarter is down slightly, and recovery may take time.
- **Uncertain Recovery in the Android Market**: Revenue from Android-related mobile customers has declined from approximately **$800 million in fiscal year '22 to about $400 million annualized**.  **[SWKS_3371149_9]**  While management expects growth, it's uncertain if the segment will bounce back to previous levels amid intense competition and potential margin pressures.

8c7e6011e6519d5ad4f3a3204fee9b9c4f0314a9c81c27eb4efcf1cf8a7e9f4b

- **High Customer Concentration Risk**: Skyworks' largest customer accounted for **68% of total revenue** in the March quarter, down **19% sequentially** and **3% year-over-year**, indicating vulnerability due to reliance on a single customer.  **[SWKS_3381567_13]**
- **Challenges in Android Market Growth**: The Android business, previously peaking at around **$200 million per quarter**, is now stabilizing at approximately **$100 million**, with management noting it will be difficult to return to prior peak levels.  **[SWKS_3381567_18]**
- **Inventory and Demand Headwinds in Key Markets**: Excess inventory and softer demand in sectors like infrastructure, networking, data center, automotive, and industrial markets may take several quarters to recover, potentially impacting near-term growth.  **[SWKS_3381567_16]**

5c552ce043fe79208e6f9af510d98fd481138e55f1c97ca97ff170aa911922c3

Skyworks Solutions Inc (SWKS)

Financials