Skyworks Solutions Q4 2026: Qorvo deal reshapes the story

Skyworks posted adjusted earnings per share of $1.28 for its fiscal fourth quarter, beating the $1.27 consensus estimate, while revenue of $1.05 billion also beat expectations. It was the sixth consecutive quarter the company beat analyst EPS estimates, a streak that under normal circumstances would have drawn some applause.

The quarter itself was overshadowed almost entirely by the closing of the Qorvo combination, which happened after the period ended and fundamentally changes what Skyworks is. GAAP operating income fell sharply to $22.3 million from $111.0 million a year earlier, weighed down by restructuring, impairment and acquisition-related charges. Non-GAAP gross margin compressed, and free cash flow turned negative for the quarter.

The first guidance issued as a combined company set December-quarter revenue at $1.80 billion to $1.90 billion, with the midpoint implying roughly $1.07 billion from the legacy Skyworks business and about $780 million from legacy Qorvo. That midpoint is down roughly 7% sequentially from combined September revenue, and management guided non-GAAP diluted EPS of $1.25 at the midpoint, based on about 241 million diluted shares.

The investment thesis now rests heavily on cost synergies. Management is targeting more than $500 million in annual cost synergies within 24 to 36 months of the deal's close, with about $150 million of operating expense synergies expected in fiscal 2027, weighted toward the second half. CEO Phil Brace framed the rationale around scale: "Combining with Qorvo gives us the scale and the technology breadth to lead the next era of wireless, as AI moves from the infrastructure to the devices, vehicles and machines around us."

Beginning in fiscal Q1 2027, Skyworks will report under two new categories: Smartphone and Diversified Growth Markets. Diversified Growth Markets, which management expects to exceed 40% of sales in the December quarter, is projected to grow in the low single digits sequentially, led by data center and defense demand. Smartphone revenue is expected to decline in the low teens percent sequentially, reflecting typical seasonal patterns alongside softness in the Android market.

Investors are watching real risks: substantially higher debt from acquisition financing pushed quarterly interest expense to $21.5 million from $6.8 million a year ago, inventory climbed, and the integration of two large semiconductor companies carries meaningful execution risk. Whether the synergy targets justify the complexity of the combination is the question the next several quarters will answer.