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    SWKS
    Earnings call· Jul 2026(Q3 FY26)

    SKYWORKS SOLUTIONS, INC. SWKS

    Jul 28, 2026 Source

    Executive summary

    Skyworks Q3 FY26 — Strong Broad Markets Growth & Qorvo Merger Progress

    Skyworks delivered solid Q3 FY26 results, exceeding guidance midpoints, driven by robust growth in its Broad Markets segment, particularly AI data center and automotive. The company provided a confident update on the Qorvo merger, anticipating a calendar year close and outlining a new capital allocation framework focused on share repurchases and deleveraging. While mobile revenue saw a year-over-year decline, the company is well-positioned for the fall launch cycle, with channel inventories lean and long-term RF content growth expected.

    Highlights

    5

    • Q3 FY26 revenue of $935 million and non-GAAP diluted EPS of $1.08, both above the midpoint of guidance.

    • Broad Markets revenue grew 8% year-over-year to approximately $403 million, led by data center and automotive.

    • Three growth engines (Wi-Fi, data center, automotive) represented nearly 2/3 of Broad Markets and collectively grew 15% year-over-year.

    • AI data center business is tracking ahead of 50% annual growth.

    • New $2 billion stock repurchase program authorized, replacing the prior authorization.

    Concerns

    4

    • Gross margin of 45% in Q3 and guided 44-45% for Q4, reflecting input cost headwinds and seasonal mobile mix shift.

    • Mobile revenue declined approximately 12% year-over-year in Q3 FY26.

    • Some softness observed in consumer-exposed areas of the Broad Markets business.

    • Supply constraints continue to impact the ability to meet demand in high-growth Broad Markets segments.

    Guidance & targets

    12
    CategoryTargetConfidence
    Q4 FY26 Revenue
    $1.010 billion to $1.060 billion
    high materiality
    High
    Q4 FY26 Mobile Revenue Growth
    high teens range
    medium materiality
    High
    Q4 FY26 Broad Markets Revenue Growth
    approximately 5% year-over-year
    medium materiality
    High
    Q4 FY26 Gross Margin
    44% to 45%
    high materiality
    High
    Q4 FY26 Operating Expenses
    $235 million to $245 million
    medium materiality
    High
    Q4 FY26 Other Expense
    approximately $6 million
    low materiality
    High
    Q4 FY26 Effective Tax Rate
    approximately 10%
    low materiality
    High
    Q4 FY26 Diluted Share Count
    152 million shares
    low materiality
    High
    Q4 FY26 Non-GAAP Diluted EPS
    $1.27
    high materiality
    High
    Qorvo Transaction Closing
    within the calendar year
    high materiality
    High
    Qorvo Transaction Closing
    as early as within this fiscal year
    high materiality
    High
    Long-term Non-GAAP Gross Margin (Combined Company)
    50% to 55%
    high materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Mobile
    Represented 57% of total revenue. Supported by healthy sell-through at largest mobile customer and strong execution of new product ramps at largest Android customer. Expected to grow sequentially in the high teens range in Q4 FY26.
    		$532.95M-12%——
    Broad Markets
    Represented 43% of total sales. Led by strong double-digit growth in data center and automotive. Demand for these products continues to run well ahead of supply. Expected to grow approximately 5% year-over-year in Q4 FY26, representing approximately 39% of total sales.
    Wi-Fi, data center, and automotive revenue growth: 15% YoY (collectively)AI data center business growth: tracking ahead of 50% annual growth
    		$402.05M8%——

    Operational metrics

    15
    Non-GAAP diluted earnings per share
    $1.08$0.05 above midpoint of guidance
    Q3 FY26

    Reported for the quarter, above guidance midpoint.

    Non-GAAP gross margin
    45%in line with guidance
    Q3 FY26

    Input costs remained a headwind.

    Non-GAAP operating margin
    19.4%
    Q3 FY26

    Operating income was $182 million.

    Effective tax rate
    10%
    Q3 FY26

    Resulting in net income of $164 million.

    Cash and investments balance
    $814 million
    Q3 FY26

    Balance sheet well positioned to support the Qorvo transaction.

    Total debt
    $497 million
    Q3 FY26

    Retired $500 million of notes that came due during the quarter.

    Debt financing for Qorvo transaction
    $2 billion
    Near term

    Anticipated to be raised in the near term, subject to market conditions, in preparation for an earlier close.

    Stock repurchase program
    $2 billionreplaces prior authorization expiring February 2027
    Expiring January 2029

    Approved by the Board as a key vehicle for returning capital to shareholders for the combined company.

    Quarterly dividend
    discontinued
    Going forward

    Decided not to declare a quarterly dividend going forward, redirecting capital toward higher return uses like share repurchases and deleveraging.

    AI data center business growth
    ahead of 50%ahead of prior guidance
    Annual

    Fastest-growing business, tracking ahead of previously outlined annual growth, even with supply constraints.

    Largest customer revenue share
    57%
    Q3 FY26

    Largest customer accounted for approximately 57% of total revenue.

    Mobile content
    roughly flat
    FY26

    Company expects blended content to be roughly flat for the year.

    Mobile revenue (prior year)
    $625 million
    September (prior year)

    Historical mobile revenue for comparison to current year's guidance.

    Largest customer revenue (prior year)
    $737 million
    September (prior year)

    Historical revenue from the largest customer for comparison to current year's guidance.

    Mobile revenue mix
    61%versus 57% in Q3 FY26
    Q4 FY26

    Expected higher mix of Mobile in Q4 due to seasonal ramp.

    Industry KPIs

    8
    MetricValueDetails
    Backlog order booksolid
    Book to bill ratioabove 1
    Ai data center revenuetracking ahead of 50%%
    Fab capacity utilizationincreasing
    Bookings net order intakeabove 1
    Design wins socket pipelineunchanged
    Inventory channel inventorylean
    End market segment revenue mixMobile: 57%; Broad Markets: 43%%

    Orderbook & backlog

    2
    Book-to-bill ratioabove 1Q3 FY26
    Wi-Fi backlogsolidQ3 FY26

    Deals & partnerships

    1
    QorvoCombination of Skyworks and Qorvo to create a best-in-class RF portfolio and diversified broad markets business.

    Regulatory process continues to move forward, with China's SAMR review advanced to Phase III. The transaction is subject to regulatory approvals and customary closing conditions. The combined company is expected to start with a favorable capital structure and modest net leverage.

    Risks & headwinds

    4
    Input cost increasesQ4 FY26

    persisting dynamic

    Mitigation: Disciplined cost controls, selective pricing actions, and efficiency improvements.

    Softness in consumer-exposed Broad MarketsQ3 FY26 and ongoing

    some softness

    Mitigation: Focus on high-growth engines (Wi-Fi, data center, automotive) to reshape business mix.

    Supply constraints in high-growth Broad MarketsQ3 FY26 and ongoing

    demand running well ahead of what we can currently supply

    Mitigation: Actively working to close the supply gap.

    Tough prior-year comparisons for MobileQ3 FY26 and Q4 FY26

    prior year was benefiting from a higher, richer mix of legacy SKUs

    Mitigation: Focus on current demand signals and new product ramps.

    What to watch in Q4 FY26

    4

    Qorvo transaction closing

    Q4 FY26 / CY26
    CurrentSAMR Phase III, 2 remaining jurisdictions
    TargetClosed

    Why it matters

    The successful closure of the Qorvo acquisition is foundational to the company's strategic diversification and synergy realization.

    We are now optimistic that we can close within the calendar year, and we will be preparing to close as early as within this fiscal year.

    Q&A highlights

    6

    Given prior comments on memory pricing, how has pricing held up through the fiscal '27 negotiation cycle, and is there still potential for moving parts, especially for mobile at the largest customer?

    Pricing is typically negotiated at the time of down-selection and does not change post-negotiation. Input cost increases are causing gross margin pressure, which the company is trying to offset with cost reductions and selective pricing actions elsewhere.

    “There typically is not any price negotiation that happens post that. That's kind of part of the whole package that you win. So there's no in-cycle negotiation on that. Now the flip side of that is we don't have the ability to adjust when input costs go up as well.”

    asked by Ruben Roy · answered by Philip Brace

    2 min read6 chapters

    Detailed Narrative

    01

    Qorvo Combination Update

    Skyworks provided a comprehensive update on the Qorvo combination, expressing optimism for a close within the calendar year, potentially as early as this fiscal year. The regulatory review in China has advanced to Phase III with SAMR, and the company is working constructively with regulators in remaining jurisdictions. The transaction is expected to be immediately and meaningfully accretive to non-GAAP EPS post-close, building a company with robust free cash flow and adjusted EBITDA generation.

    02

    New Capital Allocation Framework

    The Board approved a new capital allocation framework for the combined company, replacing the prior share repurchase authorization with a new $2 billion program expiring in January 2029. This framework prioritizes stock repurchases, deleveraging the balance sheet, and pursuing strategic M&A. As part of this, the company will discontinue its quarterly dividend, redirecting capital to these higher-return uses, aiming for greater flexibility and long-term shareholder value.

    03

    Leadership Team for Combined Company

    The expected leadership team for the combined company was announced, bringing together proven leaders from both Skyworks and Qorvo. Key appointments include Philip Carter as CFO, Philip Chesley as SVP and President of High Performance Analog, and Yusuf Jamal as SVP and GM of RF and Mixed-Signal Intelligence Solutions. Bob Bruggeworth, Qorvo's CEO, is expected to join the combined company's Board of Directors, ensuring readiness to execute from day one.

    04

    Mobile Demand and RF Content Growth

    The mobile business performed well in a seasonally lighter quarter, with revenue slightly ahead of expectations, supported by healthy demand from the largest customer and successful new product ramps at the largest Android customer. Management anticipates increased RF content per device over time⏳, driven by expanding demands for uplink, multiplying receive paths for simultaneous data streams, and satellite connectivity, which adds complexity that Skyworks is well-positioned to address.

    05

    Broad Markets Growth Engines

    Broad Markets revenue grew 8% year-over-year, with Wi-Fi, data center, and automotive segments collectively growing 15% year-over-year and representing nearly two-thirds of the business. The AI data center business is tracking ahead of 50% annual growth, driven by demand for high-speed connectivity (800-gig and 1.6 terabit platforms) and advanced power delivery solutions (400V and 800V HVDC architectures). Demand for these products continues to outpace supply.

    06

    Gross Margin Pressures and Mitigation

    Gross profit margin was 45% in Q3 FY26 and is guided to be 44-45% for Q4 FY26. Input costs remain a headwind, persisting into the next quarter. The company is working to offset these pressures through disciplined cost controls, efficiency improvements, and selective pricing actions, primarily in the Broad Markets segment, as mobile pricing is typically set annually.

    AI-generated summary of the company’s earnings call. Not investment advice.