SWKS - Earnings call transcript Q1 2018 | Skyworks Solutions, Inc.

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Operator

Good afternoon, and welcome to Skyworks Solutions' First Quarter Fiscal Year 2018 Earnings Call. This call is being recorded. At this time, I'll turn the call over to Mitch Haws, Investor Relations for Skyworks. Mr. Haws, please go ahead.

Mitchell J. Haws

Paul. you, Thank and Conference everyone, Skyworks' Fiscal First Good welcome XXXX Call. Quarter afternoon, to on are our With President call the me today Executive and Officer. and Liam Officer; Kris Financial Sennesael, Chief Chief our Griffin,

we Please will statements that refer earnings discussion are to I that and be may future include like remind our relating to Before our everyone begin, could considered our or annual on results press actual to report expectations would forward-looking Form release filings, and materially information that recent XX-K any made differ certain to including risks from forward-looking cause SEC outcomes for adversely today. on and statements statements.

Additionally, past Investor of turn our the non-GAAP our practice. include Please complete discuss company website refer Liam. Relations section for press guidance to I'll results the that, we a GAAP. to With will within the with financial measures reconciliation to consistent our call and release

Liam K. Griffin

Skyworks demonstrating mobile the record welcome, and produced results team Mitch, ecosystems. IoT and vibrant QX, in increasingly everyone. Thanks, within traction and The our profitable

in strong we in driven share, During the our per earnings $X by $X delivered revenue demand performance exceeded connectivity and high for solutions. global quarter, billion

with begin of billion, gross QX consensus. margin finally, share, per flow goal XX% and ahead highlights. a We year-over-year, $X.XX $X.XX to expanded and we generated of cash margins And achieved year-over-year. revenue We operating of XX.X% free earnings records few up to exceeded margin me We Let XX%. XX.X%. up our XX%

In addition our continue expanding design-win pipeline. to strong we our financial performance,

our SkyOne, of manufacturer; secured markets, system Kindle In newest and platforms; design Netgear's and fully-integrated China. enabled DRx, connectivity Linksys, our data telematics assistance. networks; wireless their for of support wins, we a rates; solutions, capabilities well we broad Last markets, precision automobile customers. deployed everything, home reach and secured in connected XBX number Google's feature-rich Max within delivered wins we home SkyBlue, robotics engines on broadened design modules as ZigBee strategic new finally, Nest's high-performance Bluetooth a systems; we Alexa-based new antenna tuning. premium LTE Home Across vehicles, developed MIMO with Amazon's our tripling drones, alarm and as industrial to and for multi-user outdoor and mobile, virtual from leveraging management, home leading power Our at including partnered Comcast are Orbi we number gateway; IoT infrastructure, leading a across Wi-Fi enabling systems wireless across speakers; solutions mobile autonomous quarter, supported infrastructure wins carriers MIMO of mesh and Europe for in secured with security, massive home

significant to educate. gaining wins work recently enhancing more the results, across delivered is This and markets, is balance vision record Skyworks' time our The the SkyX sheet. the and behind of and At ubiquitous vision way financial level, live, strengthened relevant ever. the we connected design strategic catalyst economy connecting all we is captured everyone and substantially our summarize, higher platform. launched everything key all a So momentum than

requirements, alleviating will a the extremely expanding catalyst also major capacity XG XG to SkyX the represent new current our mission accelerates greatly enhanced low XG dual integration XG jam in latency, will network a to a robotics. will requirement XG challenge, offer of entirely platform applications address MIMO be rollout speed, networks. times The lanes unmatched improving carrier solutions enable machine-to-machine, this performance. reliability. spectrum. delivering opening critical and world, such as Our our up spectrum, in and digital of of XG of aggregation, mission-critical and driverless and SkyX to for data-driven of new to that the expansive deployment boost XXX car, massive networks. significant created resolving XG traffic while while connectivity, levels the is IoT,

As in solutions and Skyworks the enabling breadth, is all of technology integration which is unmatched planet, two investments levels leading strategic the formidable with system portfolio, our depth well partnerships IoT extensive made and product positioned unwiring IP, smartphone the and performance, differentiated over past a scale. underpinned customers, decades, of expanding leader with by we've all and

balance cash a As the our profitability, we leadership position. extend have result, and flow, sheet to

scale Our technology strategic will investments intensify. the R&D XG pivotal as around and and be CapEx requirements

discussion of performance for committed over with create call to Kris to outlook growth are above-market last to and we value. turn most Finally, delivering our shareholder I quarter's levels and continue the as profitability importantly, QX. of now we premium will for

Kris Sennesael

in the for basis June up year, XX.X% quarters and both XX% consensus of Gross XXXX. was last fiscal up of X% of compared was sequentially Revenue record exceeding Liam. quarter billion, XX points $XXX and and QX estimates. September guidance sequential or to our of up improvement of a XXXX basis following the profit Thanks, points million XX revenue, first $X.XXX sequentially

gross of record basis or in was Our points revenue. $XXX XX.X% XX% Operating of year-over-year. margin were million, up QX XX expenses

$X we our million operating up points basis XX.X%, income earnings $X.XX. income, net into of guidance This translating result, and of XX an per by generated year-over sequentially XX and share, drove a up record As exceeding of $XXX XX% million year, basis points of $XXX operating margin or year-over-year.

million of recently review, the rate to law, are information Due approximately our sheet we tax XX% Based XXXX, summarize impact tax the we be on non-GAAP and Those booked results will benefit XXXX, repatriation fiscal last XX%. new fiscal estimates foreign tax liabilities. in tax be tax XXXX. fiscal GAAP QX related provide fiscal and let next fact the to years, U.S. our In $XXX of financial enacted analysis. are September, we the fiscal interpretations deferred non-GAAP impact rate calendar of towards further XXXX million for over for amounts In the implications the to non-cash balance tax from the This one-time Skyworks. XX.X%. access as charges the down on and a of to cash. years. are $XX that of charge eight tax that on reform. the drop three the prior effective expect revaluation in could be a charge we substantial deemed of the turning the about potentially available XXXX, in currently were fiscal our excluded effective will tax ending positive paid Before over to general, assets and phased increased results me and to mandatory weighted earnings the In provisional may The of flow, our a cash change our of generate related international savings, refine more and repatriation will to from non-GAAP

cash the sheet to Turning and balance flow.

were capital common million and cash First, fiscal with a of shares balance flow from quarter a free debt. $X.X our was no the and and $XX paid total $XXX cash we in of resulting margin million. of million, repurchased million, operations billion cash a $XX of XX.X%. stock flow X.X quarter million expenditures were $XXX ended Dividends for We

growth. When higher the has the As cash a for stock billion generation noted program. in added our and returns with strong repurchase confidence to future the in flow business leverage us recently allows model. a issued program to shareholder tax Directors Skyworks' new today, team's free dividends stock This separate Board and and flexibility capital management board reflects coupled passed authorized investment of drive press repurchases, legislation, $X the new release of expenditures

of As we cash XX% a XX% flow of shareholders to increasing our cash level to targeted free result, a the rate XX% to range are to forward. XX% return going from historically

X% up to in Now, we million. $X to income, let's review gross other rate X% XX%, million our at XX%. with expenses a fiscal QX. for outlook tax be and margin to operating of anticipate $XXX anticipate We of year-over-year, and the line, roughly revenue Below XX.X%

million the We markets, expect win million of that, approximately and and of flagship margin share With increase expanding diluted to top-line calendar diluted plan on in year-over-year. shares. with me expect a improvements of deliver design growth Liam. throughout share at and fiscal to accelerated momentum the call Accordingly approximately earnings platforms, be revenue, let back the Based across balance year. broad per count we we XXX $X.XX, within XX% turn our midpoint the reach further our $XXX to

Liam K. Griffin

enters with momentum. strong XXXX Thanks, Kris. Skyworks

outperformance in a inherent by vibrant, ecosystem, mobile resolve that is can who value dynamic integrated economy being companies Our rewards The in architectural a is complexity connected our one solutions. driven apparent with simplified results.

have our up Over tripled, than the past doubled, X flow years, was more EPS our X than revenues times. operating more has cash and

to us shareholders. the let's to return prepared allowing increasing is line to while generation concludes targeted our cash the flexibility invest open to Operator, remarks. substantially our continue strong win, questions. That for cash Our

Operator

you (USA), Capital for guiding with Pajjuri go my come X% guess, forward. for - questions. line that calendar Please to from you Macquarie and acceleration guys Inc. X% Pajjuri the Srini First said ahead. obviously question mentioned Thank you're will I Kris expect QX, Macquarie an going taking Srini you Capital. you of for

acceleration to that the Just curious what's as few in top for next line driving quarters. growth

Liam K. Griffin

if albeit is in solid into QX mean, carries at billion we the were here lower. you look some with win flagship the units this $X.XXX win of Liam. I accounts design some Yeah, signature. signature design Sure, today, business QX, a posted with significant That

in consummated and As our that set you that the a design half, we've set products new start new to second half. accelerate of a the second of move business into there's wins will

brought of continued we to some markets then right design market the So customers visible second it's Inc. actually on activity. us technologies our wins business. Pajjuri to some broad - based that Srini there's quite Capital leading broad (USA), forth some the some is half on Macquarie really known unique rate and and run But now

Great. Okay.

Do business XG is that follow start And to a and XXXX, business also up you look to out Liam. will Just to XX% RF contribute when XX% guess, think do I you as believe materially? to you growth this still XXXX XXXX? that, in, calendar on

Liam K. Griffin

to articulated for to you're we'll the We going success past the platforms, that in it's that XG, look and think and do out is so indications opportunity Yeah. a XG pursuing quite we're industry is and XX% And see the And we've into to more XX% XXXX early vigor of you platform. in XXXX. the great if XG start which frankly. with see in as what Sure.

the will to addendum engine. be XG SkyX an Our

backward the compatibility addition So having see new to to even XG spectrum you're some new XG addressing in technologies, to going and devices XG. frequency new bands,

Operator

we please up. one to given Blayne of We'll the Before question one constraints, Please Barclays. to with the line limit Curtis go time to yourself ahead. go next go and follow question,

Blayne Curtis

quarter. into March, visibility for for the And inventory. the have March. channel, into Maybe on thanks you the seen could weakness through I'm lots concerns in Liam, guys obviously thoughts through there kind some this some and you guys, pieces could curious you the March then whether you customer moving Hey, customer any of us whether was walk some taking just June if there's my Maybe could in question. handsets just your had be maybe bottom. of walk that

Liam K. Griffin

I as models, mean, $X.XXX our I quarter, with just mentioned, billion. and Yeah, had the win the flagship in Sure. in been cemented premium signature, design imputed December the specifically

you've in modestly And been though again weighed growth flagship, which it up got fewer great, broad in so were markets units up China degree the some us. offset to we for March what on in quarter also us hasn't is naturally in able March. which for And to be And actually year-over-year but March. the are that

guidance. that March nets of all steady, market customers, broad taking recovery out weakness from flagship quarter, our some our little a in bit into and China, So

Blayne Curtis

Got you. business. for and And on the maybe March more mobile guidance just just broad then between markets one question the

March just to been expect there. I'm seasonality broad quite out growing I'm or markets still figure be of you nicely just Trying into teens. whether up markets kind curious the has curious, So down. broad to high

Liam K. Griffin

Blayne, as continues, there will be mentioned it Yeah, should broad. well March I quarter in be know something and about the for we think. June, up June you it okay

Operator

Question America with Bank Please Arya ahead. from Lynch. Vivek Merrill of go

Vivek Arya

the it could Is be? Thanks Liam, addition sockets, question. applications for that on that more the in to some half. mentioned existing execution. shared is PAD, as more my in kind of in content, in low-band you what and Congrats second taking good or such wins that new

Liam K. Griffin

It's I to certainly is remember any that year-over-year. Yeah, There It's happening mean, evolves stagnation the both. – one forever. the really it's portfolio hasn't of there. that things provide been we been

of to really and There's It the product. seeing really It's an that demand been us great we arsenide, technology, on our in-house our are require in in performance differentiated for of burden all flex leveraging solutions So technology. muscles driven creative our Mexicali, elegant us. that. Tc-SAW our switching, capability, packaging kind our allows gallium increasing

of more set areas in that grown also expanding in So up content, an in we're and value. completely. And generations into ago maybe products seeing rich share two gains evolving we're then richer be three have to or more new

starting So some band we're customers. in doing We're to in cases tuning. develop higher antenna expanding with We're more GPS. things in solutions

that So for the of all great position will it's really put in above the half. us second

Vivek Arya

how the lot of as these is sensitive your Intel current some way? pipeline of let's a content if, your change for modem? more example, that baseband the All So, right. any my of share follow-up, does flagship incumbent, win the And supplier to models to happens from in say,

Liam K. Griffin

No, And question. that's actually. great does a it not

both HiSilicon and you'll go at Huawei. you if Intel see with And position up great with into Qualcomm. have lined Asia, We us

with us see You'll lined up MediaTek.

that And companies certainly, on the do we on that. above. going So And real we're again, right the there be partnerships. side, with baseband diversity better to we're with able all some our and there's with along track have to work of

Operator

a from with Capital BMO ahead. Ambrish go question Markets. have Srivastava Please We

Ambrish Srivastava

wanted capital to very you timing, B, go much. thank Hi, the to and I wanted that. understand, allocation to A, and just to just components back the the

you you generate. cash clearly, of guys analogist the a model have very in free So, terms

catalyzed your this please. dividend? the reform was to way then within quick that, the what's follow-up, by And had capital then that I return? and right you're a about buyback So, And the think raising between mix tax

Kris Sennesael

XX% billion the cash, $X.X we return, a available, continue triggered can offshore, repatriate of of and part, It's our combination capital to between we right any and evaluate, buyback. Yeah, very $X of today. roughly consequences that that we free becomes to course, buyback use new of share the will billion a share evaluate authorization $X mix tax without was flow. that the of and but will cash, the now continue and XX% pleased both, but dividend dividends again, payments announce which billion that further share target for by In we was something, now cash to fact our to buybacks,

Ambrish Srivastava

Okay. And for Thank this can follow-up, one my then answer well. you. Kris, maybe, as you

last capacity, you the of when are also, indicated drivers increasing to one CapEx, talked back mix actually had raising your internal between I about the about that and going versus earnings margin, for asked the then you Just call as you have had external. you your gross

that two, to and new some to are raising understand increasing the the just internal then help between So progress you are I increase versus capacity path expected in fill capacity on dynamics you capacity, because and want you have the external? that that design about wins that you talked

Kris Sennesael

seasonality and typically to Yeah, quarter. absolutely. some December is well, There the CapEx quarter CapEx the low is as our

going June both and are the make ready for fiscal year. the line well we second that get is as the second or This March there. as as quarter, calendar in CapEx capacity along to in the of half ramp-up we increase quarter related extensions investments the quarter to technology We the the

good progress progression there continue in our not the way in that still to done on and so are left make all hard insourcing teams there with the we working is XX% insource. filter We're and so, place. that, it some putting towards terms operation, And there, of a

Operator

We go have question Stoss Please Craig-Hallum. a ahead. Anthony with from

Anthony Joseph Stoss

any us guys. inroads? Nice you're on Hi, if talk XXX Then, as kind SAW if mind, well a competitive Qualcomm CapEx can environment. XXXX. BAW, a is you in Liam, view you on about as tough front, wouldn't performing job making the and what either maybe for total Kris, give seeing of

Liam K. Griffin

the today a moving are in more in But burdensome the opportunity the is market connectivity Sure, bringing to it's into an landscape. facing higher-speed them. our for XG. start and I see what I'll also competitive challenge certainly, we customers mean, with market incredible

suppliers can so make products and work they're do market. to that in can selecting to So perform and suppliers resolve spectrum interference this that challenge. There's crowded more these much execute and actually and done the great be

to to blocks, the have of of So bring for account-by-account nature our the covering gigahertz, important. that assembly us, way any we quite the X.X our architectures, do building beneficial Tc-SAW configurability a what's that crafted to solution. high-performance the has is to stretching spectrum, filters and very and ability to unique been bring all test capability lot have offer been the gallium arsenide, And Tony,

also that what's Kris table don't and group, with on we've today, customers our So We're peer something as we the something ensure we with. care be as mentioned been early, across see I making that into in that's And the of our take investments. it's offensively rewarded XG. technologies to we're can the move investing that

Kris Sennesael

Yeah.

might ramp running or half. XX%, be we about on the prepare will about above or as the But CapEx XX% So that. be second slightly even on in for

Anthony Joseph Stoss

Thank Great guys. you. job,

Liam K. Griffin

Thanks.

Operator

(XX:XX) go Stanley, ahead. from please Hettenbach Craig with Morgan

Craig M. Hettenbach

up. Yes. Thanks. Liam, just a follow

terms the the how quarter commentary going mobile, the sequentially on you're You would and on in June June in you terms supply just the into markets of of Any commented broad what quarter? up. visibility out view from chain, seeing

Liam K. Griffin

Sure, Yeah. Craig.

So basis we're March on say. been a I more quarter where through a has unit so challenged bit mobile going a would

I get we bit. in probably As but our play up on into expect to June, it we markets signals role be a also June, will certainly have the June, total. in in Broad completely a mobile all and company okay don't think aligned should that, be up I of for

Craig M. Hettenbach

markets, if maybe context in the XX%, then do just of can growth and you And as higher it. term, at to continue I kind recent call grows it think follow term, longer of just XX% sustain on a XX% Got that near in some just the growth and then quarters, look up you of broad XX%, year-over-year business rates. drivers at these

Liam K. Griffin

and very customers we business in for dollars We pursuing markets, see know lot those. at the opportunity market. more haven't been efficient many that mobile addressed. opportunities is so are, We we're just There's sustain. but can growth mid-teens, us. space. we've haven't And we that great in there's tremendous that think a and In growing do addressed a We we where Yeah. broad of that

pursue and offer technologies advanced routers. modules, certainly We to I'm Wi-Fi very driver it. see ZigBee points for in becoming that XG. leveraging is prepared we to of XXax We're (XX:XX) pleased Bluetooth. will continue some remarks. rolled with from to in Automotive the in critical to of access some these in portfolio the the more LTE be a starting us, out applications and mentioned We've the more

So the to really of applications the we well markets. spectrum very have itself broad across this diverse fact that connectivity very, lends solutions that we see broad

And that's parts. the there foreseeable So should expect much to sky future. for mid-teens one important we of there's that so the blue be really growing

Operator

Malik have Citigroup. We from ahead. with Please a Atif go question

Kris Sennesael

Yeah, towards very changes above model, that are progress making which any making making our not we been model. top growing is we progress good good target to the line have there. again we're and market, But target

XX%, of We down three softer March, a good quarters. in point margin bit, improvements December. coming target following a we Obviously, on good in June, the further little have margin again, XX XX point revenue in basis in but September, points there, in basis quarter row, gross a is progress, in a to basis make good XX progress expect

December flow. to And so XX%. margins, of cash on December in XX% there. beat in of that free XX% flow a basis, really a flow. we to in actually target free target to that, the there quarter. the and on one cash cash number margin we are is following quarters We free But the full-year focus we of And we course, expect operating The and close target that a there in addition soon get quarter,

Liam K. Griffin

and to pursue of and the SkyX we're to to technology, filtering going on type that's about the number of And to that have need. opportunity would drive a And our still address working do. platform every XG. just we is filter frequencies Well, we technologies higher what solutions

those will be will of in-house, some through Some be partnerships.

Operator

from Chris James. Please Raymond go a ahead. have question We Caso with

Chris Caso

Yes, thank you.

between provide broad markets quarter. I And December broad the markets sequentially and into mobile start. you're in quarter? expecting Could the Just to to split think you said you increase the March

Kris Sennesael

Yeah.

with mobile quarter, out our December So a as new largest That by was expected. especially quarter some the customer. strong driven platform obviously played ramps

And so market the of as slightly and was mobile was a XX%. broad that, above slightly result XX%, below

to broad see well quarters out, As the couple Liam some in year-over-year growth of in to market. expect next strong as we continue sequential as pointed

can market. is And on so to that going XX% roughly flip and about broad XX% think full-year a basis you mobile, again, so

Chris Caso

Okay. then there respect And anything with a return respect as your as it the is on revised update said this pretty Great. further I happy perhaps think of your M&A? just strategy or through appetite Thank to came your be could up, to in view you've policy, you. cash but follow light towards at thinking. amenable to there the read past, your is, Liam, you to with looking new you're business things in they with current you'd along, us

Liam K. Griffin

Sure, right have view itself we're as discerning said, you Chris. on M&A, presents opportunity to execute. the certainly we Well, a if position great in

Our strong. cash balance is

free is some We've strong. attributes provides Our that powder. great flow business in got margin cash model our

but not We again, shareholders as understand that the deliver table, off that is capital So but we announced taking we're we aggressive, outlined allocation the XXX% we that the want buyback to capability to that. well. have billion today $X be sure still that

always at. front and of us. But on day-to-day the we M&A lot we're a good look that opportunities something is happening end. But in we like there's this that business, of So things driving

Operator

We ahead. question have Please Kumar Jaffray. Piper from with a Harsh go

Harsh V. Kumar

first guys, Hey, of congratulations. all Yeah.

you. Every Solid that's reported company I execution environment. a Liam, in what's for had China has being question a tough about tough. talked And

a And would I'm modestly me China I for flagship that. mentioned, I'm driving guys the what's role up also, ramp, is think in in curious quarter? March the Korean for phone you March. if customer or playing you guys you be then correct their wrong, that

Liam K. Griffin

Yeah, sure.

we've off in flattish. now to China QX, say a grower Korean up in about had got them QX, us customer And up right March. a bit. would flat year, bit been is just and roughly cooled is a going the the into that for I So China middle the in faster of

Korean in the quarter. up customer year-over-year March have We

Harsh V. Kumar

for in filters my at more then bring see your through And then and progresses? follow point changing up, the you incremental it. that time, as year this how do in-house fall you as Got of the

Kris Sennesael

Yeah. is effort, an No. That ongoing Harsh.

in so so more that. on consume the is more and new filters, driven the team the course of by complex executing And well part of platforms ramp that and very

a to and And couple XX%. we'll matter just of get that quarters it's so

Operator

We have a question B. Please Craig from Riley. with Ellis ahead. go

Craig A. Ellis

Thanks the question. for Yeah. taking

I be think follow to Kris point made may up but it a I wanted I this to understood sure clearly. a that make just earlier,

So of wanted year to growth a what potential broad I have businesses. clearly start each the do markets. is focus on We strong the of to main in two full-year the calendar

You're expecting year. half integrated very in back mobile to the back strongly come the of

year, to is So which broad businesses Liam the the or Kris, Is year? ramps, growth and second the for the half better of strength it stronger of through it the and mobile, grower? those is the market, integrated be just the given given calendar going to start year

Liam K. Griffin

the half mobile. little give color glean really Sure. see what so the I Yeah, will second fiscal to you we can in gains you're that to today. a the accelerating even and more you of on both, calendar tell try going I'll and calendar

We for those have P&L. to matter that make been And our of design cemented. just it have a really it's powerful some actually into time wins

markets, mid-teens. So that a path we to steady know. we Broad see

seasonality where of that of modeled number the we there's you've XX%-ish We we see that think to diversification balance So kind it. very a do of across see And of in kind there's a through not that I mobile. that's in design see the if a markets. broad level lot tend kind win of the of kind year, customers. footprint and And those broad

wins, to the definitely in is as current a with mobile see half growing with and we market the of known business year design back going our grower. stronger opportunities So be broad mid-teen

Craig A. Ellis

go XG is That's And optimistic for then every half band seems XXXX significantly and the increase year in we're the XXx that term. that the It really going off combination. half putting seems where And given of longer like helpful. of more it first ramping in in is perspective indication materially have kicks that more really we year. very to devices content looking back in the the going to an the is really era and calendar follow-up get more up

So, even mobile to of the we second is How really to stronger what we're this the do now a very could that though growth and over you bit in a year-on-year business half next growth relative you rate pause good relative XXXX calendar integrated next the at see getting we to have year year? look three? could what see coming the two in

Liam K. Griffin

presentation. Yeah. certainly you've our mobility, in clearly for SkyX it XG belief catalyst yet in in No, necessary the talked great that's another question. the prepared a be it's we it's will It's about that that as and our and all reasons heard remarks,

the architectures. very So thought pivotal we that going shaping to right We're that with the leaders know much aligned. and customers what needs We're happen. are to play a role. We're working

and you're going beyond, to then forward bit, will it start XXXX into in to apparent we're there's model, architectures, before are roll second be little a XG in today's what a looking see think great content. we're think And steady more but become to to the still there's more over that. going great several the and down years up, we're upgrade. So here, catch I that the and going to whole seeing and But see market in I we some half, units get stuff

Operator

Snyder have Charter with a question ahead. from Equity Research. We go Please Edward

Edward Snyder

Liam, you could you drive walk know been a utilization for you real factor improving primary lot. XX (XX:XX) But a work here, maybe margins. through in the the identify margins. gross next you've I I months if metric guiding us have of will gross is what every quick on those. then know just Thanks. Good factors And months, could. follow-up. XX that I those, one if and three Thanks you see

Kris Sennesael

that. I'll (XX:XX) take Yeah.

and So, That drivers first obviously, cost that and is our and the utilization one. haven't gross absorption. one, incremental is changed, revenue of fixed growth course, better margin us revenue gives

as third least, well insourcing lower at fabs, we than model levers, further some performance in we ongoing it's then we the improvement last filters margin fabs, the buy make that will all a not front-end progress as the filters but that it's of target operational ongoing XX%. three towards the our that, those our are cost bringing And that fabs at efficiencies talked parties, about back-end where those from and time, Second, the well. while of the operation. continue filter in-house we've to And as drive them drive much our filter of course, good same improving

Edward Snyder

I mean, So, in I guess, if you're the I one, is, Kris that already Tc-SAW. could, follow up gargantuan on

think, I your that. second rather just – certainly of relinquished have point towards trying to kind up scale, to it, but say they you, where investing closest competitor keep on gave Your won't I than catch gave the

got largest point, Mexicali. guess, at assembly earth this packaging I test on the in You've facility,

were scale, So scale. monster how mean, I a much those couple got – you've of about and already

other give sketch would real that at be share make new largest how these it? Why is one case. in complicated modules. guys here well, be like spoke of whatever, on the Liam, it but filter you your gains and wins been of it filters, new times technologies world solving us you your from it how some seem the are Qualcomm, Is few Thanks. from because and targets. you is slots seems is And or gaining several there's even something (XX:XX) are it you more Can to from to you'll to your trend keys everybody out content lot share characterization, design? about you to the amps, and the going system they complexity about gaining quick, those about real chatter are limited if seems losing be apparently So or relatively Japanese, of guys I then, see the definitely in a a could camp new mobile customers, if

Liam K. Griffin

integration fabric No, margin I Yeah. a question. outlined. the other great really margin a I'm just the you into really as the going element back bit that's of is mean, pieces to of critical our And technology, one dovetail too.

no win, If to one's So, and opportunities win. we suppliers going in act the requires differently our don't help to and the complexity the customer to help mobility challenge really customer. find

high-band. a with while get transmit We work solution crafted a that do It from but SkyOne. we integrated building our change lot that solutions. started become for airspeed, So of it's took to these goes DRx can on filters, again, and chain, dominant our to with L&A craftsmanship dovetailed Mexicali. leveraging on receive leveraging that another mid-band to our resolving unique technology, low-band developing that the through we We've solution, the problem deliver

we and of see because been opportunity with lot barriers margin a it helpful. a the That's competitive That continue. tremendous also it our creates value So to customer, creates peers. presents that

Fewer into the start of XG, the the pieces out difficult more together. more can we and domain even higher curve As and gets companies to frequency move landscape into challenging. along these put

of growing, So us. and for all then unique. SOI, out been our that's test, and how with we do assembly best it crafted in-housing and that ability from easy, that working the gallium own the comes that's It's to in ability recipe We technology, supplier, filter to and work every arsenide, with with go to partnerships brightest really is the configure our but base-band not Figure together. that. get

Operator

question We go with Quinn & have ahead. Company. Bolton a Please Needham from

Quinn Bolton

the largest these or competitive Congratulations to lose XXXX you low-band results. you your to the more admitted in the second that see low-band phones in then market Do flagship a follow-up. likely new pick I've on half. Liam, of half do as competitor PADs? it's got PADs guys. ramp a in Hi, up And second nice share in expect share has

Liam K. Griffin

low-band see Well, share specific customers, yeah, robust PAD. barring any a for market we position

of really milliamp product to its that growing higher for delivering expanding and example, reach and technology, level see power output performance. also We performance bands,

an the industry. to So continues important increasingly for product that be

We players. populate scale large expect that X a of number through to Tier

Quinn Bolton

the up phones receive flagship at significant as a XXXX, in chains? follow just, expect is require announced do you percentage you look have premiere a phones that being gigabit then modems XxX those And of to

Liam K. Griffin

XxX is innings We're stepping now models. seeing it that early some in high-performance performance. we're through with the and increasing. Right increased flagship of

the it's kind that I key. solutions of I content bringing together without manner that roadmaps the another degradation questions, allows expands greatly So signal the mean, in it it's we starting opportunity. customers, for intricate to few the think to but in But last size become of integration about is an kind of greatest mid-tier talked reduced performance those of players. point for all the RF apparent on the

work them isn't more XxX at more unison simply so a and they just higher So really in about that putting in radios. It's level. architecting

Operator

ahead. is Acree go from Hamilton. Final question Please Cody Drexel with

Cody Acree

Hey, thanks for taking my question.

PAD Just following question. low-band the on up

any increasing you guess, that I And Kris, gross high? if we Liam, of expect and do next implications the few how over guess, margin on does low-band, I So see your your have to mix mix outlook? look low-band an mid quarters, then, versus

Liam K. Griffin

is new year. Yeah, us, again for each PAD the but level every and a performance the I we are not raising mean, low-band product

be now, see what half mid would ones of you'd band as or now across important see XXXX for And product But launching a delivered it's see solutions. band extended multiple business customers. of So that where There We're more than is in it's few are delivering very to most I this going we XXXX. critical second XXXX be it's our one reach, our We going the in mentioned. being right different and high also driver. architectures. of a what and

it you kind moving low-band the we're same is where side, mid of high to receive flip and there. DRx DRx, with started we If following to a the chain

both got sides. you've So

have you And that transmit got always. has times, for these You've product course some to of from receive then key side PAD as benefit a architectures. be a mentioned us of will going newer that's low-band few been and and

Kris Sennesael

running of company gross on PAD point low-band a about is the And average view. Yeah. from margin or

a it's tailwind. a not So headwind or

Cody Acree

my to follow then And up. Great. Okay.

Qorvo at post kind ramp. Samsung week, of made some to last retake pretty spring this Huawei, So specific and portfolio share some their about comments expectation

square confident position you're in back help of well. like pretty comments? versus maybe the Can your confidence as your half you their Sounds

Liam K. Griffin

confident and feel at look really there's I competition. design our that mean, be wins you're to know I we've fiscal. for a and feel listen, We feel we've is I in, calendar We that of going that consummated. lot won, opportunities a and This play second the Yeah, and in outlook technology, see good. growing really half. second very here what the about good we in we that market others. there's the But going to half to start

Operator

now over closing session. call and Ladies any comments. today's back for to the question-and-answer Mr. I'll turn that gentlemen, concludes Griffin

Liam K. Griffin

the participating for you all you upcoming quarter. today's call. conferences on We look seeing thank Thanks and again. at forward Well, events during to

Operator

conclude today's that conference call. participation. you We And your gentlemen, ladies and thank for does

Skyworks Solutions (SWKS) 6 Feb 182018 Q1 Earnings call transcript