SWKS - Earnings call transcript Q3 2020 | Skyworks Solutions, Inc.

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Operator

Good afternoon, and welcome to Skyworks Solutions Third Quarter Fiscal Year 2020 Earnings Call. This call is being recorded. At this time, I will turn the call over to Mitch Haws, Investor Relations for Skyworks. Mr. Haws, please go ahead.

Mitch Haws

Rob. you, Thank and conference everyone Skyworks fiscal third Good welcome XXXX call. quarter afternoon, to today our Officer. With Executive Liam are me Griffin, Kris our Officer; President Sennesael, Chief Financial and Chief and

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

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

Liam Griffin

Thanks, Mitch everyone. welcome, and

the navigate rigorous upon implemented connectivity working on to responded depending our environment. deliver protect with discuss markets like and we the Before solutions recognizing and families, to team, health businesses of of are designed new talented as start We've adapted that to the worldwide. pandemic. Skyworks comment worldwide QX pandemic, rapidly we've and to I'd our our valued by and vital protocols a we trusted I to want which continues parallel, efforts continue impact tireless to briefly to customers safety people our the along results, employees the partners. In COVID-XX

IoT consensus SkyX in leading applications gains Skyworks quarter, quarter our traction powering delivered our and overview the customers. an to in Now platform we'll turn third our at OEMs across as performance. results June above increasingly the smartphone innovation XG well of

of per guidance. XX.X%. achieved totaling quarter. quarter, and posted $XXX we million third strong And flow earnings margin the revenue million by guidance margin of operating reported beating $XX We We our in of $X.XX gross the $X.XX. above nearly share $XXX generated we of cash million our XX.X% operating For

XG our highlight evolving Our adoption landscape of points on well customers reflecting to momentum continues the as to accelerating across the grow with five and critical improve years. are over A $X handset a is growth subscriptions as the Globally, geographies. business billion data broadening technology. diversified approaching continuing this a XG of set estimates of demand few execution across XG. rapidly next

Wi-Fi along are broadcast released, economy. and fortifying June, wireless other and of standard multimedia spawning In technologies smartphones the advanced fact an GPS XGPP in of VXX, XG such China, extension a of expanding XG and services. new into usage as sold technology X other of Clearly, connected new month was the validating also cases all approximately, XX% XG-enabled. the with backbone And during were IoT, enhanced

wins During the applications automotive, numerous industrial mobile defense. quarter, we secured the cognitive key audio, from across and to design aerospace IoT, phone

models Oppo, we mobile, Samsung, Xiaomi. Vivo flagship platform in and SkyX at XG multiple are Specifically, our Motorola, across expanding

launching engines leveraging that our we'll at voice points platforms launching In and and we're MIMO tri-band security are Juniper integrated AT&T's Sonos. we're and Amazon Linksys; of be IoT, and mesh ramping Google; Wi-Fi at Ring XG Wi-Fi solutions; our in routers enabling the outdoor bars powering we with highest premium Aruba, and solutions sound this connectivity addition, In later some systems; access X performing indoor at assistant populating XxX year. gateways and and

powering gaming cognitive audio wireless new headsets. In solutions addition, delivered the we leading

to Now space. industrial moving the

critical And aerospace filter in with BMW, of underpinned defense manufacturers. We by demonstrate our in growing leading technologies, resolving and circulator new customers wins for architectures SkyX other leadership, companies. and solutions demanded at capturing performance market our are the XG. at and we're IoT at diverse complex gains GPS supporting leveraging platforms These and automotive, Bosch increasingly designs and Ford advanced set our leading a Gemalto in preparing and

the case our online a work-from-home and enabling safe touchless in learning technology, usage have and education, of During a variety telemedicine a of witnessed sustainable the core at-home sharp pandemic, inflection media commerce. and shift gaming, to fitness applications, we

are Given typical this illustrate of pressure on XXXXX as being data on traffic, day XXXXX videos Internet for second, increased XXXX before. watched high-speed in calls. intensifying, YouTube, are the XXXXX demand consumption, just To is Skype searches a never on the taxed network one networks how there Google and gigabytes

proven a these paramount connections compelling Now creating Skyworks' ever it's delivery is home seamless connectivity at than Skyworks Zoom Telemedicine or commitment make for market efficient. Whether and Touchless opportunity always-on solutions. to more is our FaceTime, Teams,

With we handset short, reach bounded our are range to our benefiting our more critical. and to expanding in a In discussion never unique across With ways the our and QX never continues a the for we by turn will outlook. customers, expand Kris space QX forward, an volumes, emerging call been have the Looking set, of essential IoT over technologies of applications I of that all performance valuable, and imagined. not as have utility opportunity solutions. wide that industries enabling from and

Kris Sennesael

million, Revenue third into million down the the of QX. XXXX Thanks, $XX than Liam. was of Skyworks' midpoint is year-over-year. X% quarter higher $XXX revenue which fiscal the coming guidance for was

of negative midpoint and as guidance. slightly million in $X.XX margin was diluted or $XXX resulting is our other million, QX in driving making to net was had COVID-XX. revenue which prudently OpEx, Operating by $XXX while the Gross rate the revenue operating of future of investments ForEx in quarter X.X% gross business. continue the the generated losses. Huawei-related expenses, translating necessary despite profit an of a up excluding research fiscal the of our driven were XXXX earnings XX.X%. We manage margin tax accelerate growth And to We $XXX and of mainly of development XX.X%. operating was $X.X year-over-year million, million effective we income, $XXX in share third However, per above into income of impact $X.XX up XXXX, year-over-year, from million of X.X%, both expenses fiscal

Turning cash and flow. to the sheet balance

was free million, average XX-month fiscal Third an resulting $XX cash of cash common a shares for flow a total dividends trailing XXX,XXX million. cash stock million of our million of free and basis, from $XX operations flow margin in $XXX Capital paid $XXX million. On XX%. $XX.XX in repurchased expenditures quarter approximately our price of flow. $XX were at is We

to last a and combination three and cash XX% flow fiscal debt. first with have share quarter We repurchased have ended months, shareholders of we the X.X during the shares. billion we we of of the returned buybacks. quarters through During investments of dividends $X.X And XXXX, free cash the no back XX have fiscal and million third the

move our to let's QX. Now, for outlook on

demand We the solutions. expect revenue per double-digit our sequential and strong for growth, driven market-leading earnings by share

$XXX we be between million $XXX to revenue and Specifically, anticipate million.

range million. gross XX.X% and of Below million tax line, margin in and the to in X.X%. expect roughly We other of we of $X income approximately the XX% $XXX.X anticipate operating expenses a rate

million to diluted Accordingly We the further expect our earnings we the diluted to at range, of share of per midpoint deliver reduce shares. $X.XX. to approximately share expect revenue count XXX

turn Skyworks' a to to raise generation, in share. confidence call we outlook quarterly Liam. dividend our XX% cash to the that, strategic announced per back our And given and over $X.XX I'll Lastly, strong flow with

Liam Griffin

multiyear cycle, positioned are now in is Skyworks outperform. we traction, at to upgrade the gaining of XG cusp With one Kris. which Thanks, a uniquely

Our provides SkyX most baseband be flexibility to customers, the our platform while to innovative tremendous handsets. powering purpose-built agnostic, XG

ongoing And automotive solutions these to Wave are applications. as and complexity in expanding investments and In industrial filtering. now technologies, TC-SAW same are aggressively with Bulk adding enabling across both addition, intensifies, we XG Acoustic our

we and just broad technology for and modules markets. BAW-enabled both mobile fact, see exceeded million strong XXX In momentum in shipments of this we

rapidly our to well Our and connecting and of evolving been XG, speeds higher proven delivering XG, all advance more never key time ability lower capitalize across latency, to market opportunities. Indeed the everyone has and us relevant. protocols, mission now everything positions connectivity XG on

capabilities sheet stockholders. premium growth of the that our to returns strength concludes the us enabling to profitable Skyworks deliver and our cash remarks. accelerate That prepared generation investments for while fuel allow our long-term Finally, balance

Let's for line open the questions.

Operator

Instructions] or Bank Montreal line [Operator comes question of of Vivek your sorry. – the And from first America, Arya from

open. is line Your

Vivek Arya

my of Liam, for you. the in the June what ago and Thank September? weeks quarter quarter the – what's phone. the strong America. the strength of one in curious execution. mentioned Thanks million-or-so Bank one Kris congratulations I'm on I the in results driving had and and a because question Liam a taking Yes, and XG drove flagship in upside asked of delay the few competitors possibility $XX of your that

tension-related Chinese of pull-ins by I was that or customer. by wondering, or were you any supply-related impacted any by trade if potential kind So

customers? kind upside of the just and true us demand a us progress your what for sense about So tells with the state give of

Liam Griffin

Well, the launch that upside initial some through number largely of we're – to that from with much Vivo upon came we partners XG of the the mentioned; China launch products Sure. of our Oppo, Samsung, and a others. opportunities execute able

our penetration had in some Wi-Fi nice also portfolio. We

chain QX. but was launches, quarter some have issues Our fair to the a the be with they we into X did us. Wi-Fi in supply grow. the propelling mobile month through last that's to great core quarter combat were of to through beneficial us to still now improve started there But opportunity to acceleration We

So right we're very comfortable are with where we now.

sure did what but team delivering the well Still navigating a job. customers for executing think through our COVID-XX our and headwinds the need. I factories good

Vivek Arya

more big for we also Got and is that headwinds about perhaps ramps Because these going macro COVID think COVID. I of then XG special disruptions the this how but of it. because seasonality should follow-up because – there there the because are imagine is And December? all my does year into

these December should takes? given quarter about puts seasonality think how we all So and your

Liam Griffin

Sure. Sure.

but about really talk and you're year. going at the of today we I with think see we've created. strong obviously, for based start demand we the XG will of the think Now, when quarter wins some be tremendous, December, on Skyworks, technology, that a the as We come think content here we're guided still just working reach that that that for the you happen quarter. end lot powerful across some new December design QX to us. have to at at the about that which look But will number of that this is launches should we and customers we And a traction our

So we're for positioned it. very well

handsets always bar and to second talked As that through we'll XG our to friend. we what half is able is demonstrate about the be we've sure. exactly technology high. The That's in want for here see complexity

Vivek Arya

Thank you. Great.

Operator

Toshiya Your from from next Sachs. the line Goldman question Hari of comes

Your line is open.

Toshiya Hari

a markets taking business Kris, help And can you broad of were guess in what the and you and broad out the the question perhaps? of by on is Liam, more the within guys. But if Hi there. talked of key importantly, congrats number design on markets. percentage some in to QX, about what's and if strong first what you September drivers businesses markets? my came Thanks sort wins markets of kind my broad results. sharing quarter. one I for guess the And from question revenue highlight I broad the into in or two outlook were of

Kris Sennesael

Yeah.

So in XX% quarter the approximately total broad was June markets of revenue revenue.

was a flat market to a sequential March As broad a result the of compared basis, quarter that, there. on approximately

markets expect the up forward, our a acceleration an we basis. on double-digits business do broad quarter, be do into the September see September in there. of quarter, Looking we sequential And the to

Liam Griffin

under lot infrastructure just like gateways, wins of some work with of a little quarter, A Sonos, umbrella wins. designs good And here and wins did Ericsson Fujitsu. our customers color Honeywell, this with design at design and brought names bit Toshi. Yeah, new last really with on customers on more AT&T design

markets gaming we've audio broad gain then audio broad of a reach the here some and got also, portfolio some wins starting momentum in with very So and is great of to our some cognitive platforms.

portfolio in to roster in can on lot broad, top QX And we customer to line. more diverse a continues up the pretty be going in We're there's a markets. grow. strong the So, do broad

Toshiya Hari

mark million you about then a quick that. talked for on Thank you exceeding it. the Got follow-up recently. XXX And BAW,

months passing you a XXX million. ago think couple a put I on press release, of out

clearly for that key Curious, still of it's point where big applications there. at you're seeing would your you're kind can hoping customers? I BAW? roughly of So at small And good what was this is are percentage you of but is you. today seeing momentum I the could some ramps context if or the point, your what provide, helpful. business small Thank you share, how this how imagine be BAW pretty at

Liam Griffin

they're whether go kind, system of Sure. SkyX. our into like Acoustic that Well going look that or Sure. will Wave, way Bulk any the to be at it's technologies a technologies, solution a we TC-SAW filters enabling

parties now. that BAW. There to trying addressing to with node that where solutions procuring to compete different we with were try actually we're third develop technology were times a right So with or

Now we have it in-house.

it design reach extends we And factories. it's design but own It units gives technologies. much have deal share band our pads. with again, some cellular Acoustic great, got us -- a of wins Now Wave in ultra-high in market get. is We've world, other got there's to Certainly We've go in flexibility. our us within XXX for million more there great the out areas. Bulk wins so

traction really So ready here to of the win We've over And and that with technologies, for customers, the deliberately next in it's years the months. lot fortify is interest. a And We've think accelerating happy got invested early the this. I with lot over I'm of innings. progress. be to should months design a pipeline team's X well. carefully XX the team

Operator

your comes Stanley. And from of line question Craig the next Hettenbach from Morgan

line open. Your is

Craig Hettenbach

Yes. evolves talk Thank kind years? versus And about that kind you. transmit how over you follow-up few the today receive for Liam, you of that on positioning the time just in path? on within pass of just BAW. a maybe next Can

Liam Griffin

Sure, can application our We're well. many be go Craig. for Well, different we segments, BAW I actually in UHB, band. actually modules BAW can we high we opportunities mean – Wi-Fi go mid-band, can as the in

can So growth there's capture. a lot that of we

at are XG some opportunities duplexing, – division BAW also a you to which and unique more also Now, in you're create time dealing you've when XG certainly start with than segments look our But others. some for TDD, does challenging for technology.

like have technologies new handsets, and we'll in in also Wi-Fi we that with And BAW. technology the capture other other So XG and can are see that then deploy said, we there adjacent of I then markets growth can some been some only, markets. technologies

have technology So that under our it's roof. a great

been time. spectrum. what cultivating But what As and understand I should the we've more us, understand a We mechanisms. said, update to from and continue We and you. belong, we'll long it what filters you for frequencies, expect

Craig Hettenbach

since in Thanks. while just any helped and And follow-up of part Would been What a terms just since Skyworks update little it. you a it's acquisition your being scale get the update markets. on how just then Got has of in love broad completed just performing. an there? as reach to Avnera that's perhaps and

Liam Griffin

voice the some question. we I'd a Great We're exciting, has high-performance gaming an months very, a had synthesizing, the just headsets, Avnera Well, audio lift products Thinking not audio. about to been have now technologies and say seeing six Sure. only with but Sure. really voice powerful itself, now We're really as here the technology great like in is acceleration very right? that incredible. thing. interface moving of

transactions, some dealing we're and and Looking stuff. touchless at what with the really commerce, touchless pandemic good

AIS. basically portfolio by call BUs. on business having AIS was continue we really a report don't been So last strong have best we our has this BU in don't And We expect we really momentum quarters, to momentum next several what the quarter we But BU, over had all that said our it's the the -- accelerated. so have that, we've segment far, but by quarter grow – good to there. and

Operator

of next line Barclays. Blayne comes from the Your question Curtis from

is line open. Your

Blayne Curtis

curious, on kind they're shift my taking has for emerging does seen think to – Thanks questions just latest growth. what I you've like of I'm guys. teeth Hello, Liam, Huawei to either solutions. and curious this as opportunities in you. we update and going restriction nice some I'm the some seem I gain of Is any with them? could there once And out happens? small look change you box guess Huawei restriction anything maybe very for share. that I I seen think maybe us Have then is positioning terms think

Liam Griffin

it's that, Blayne, come an have bit. hand exposure quite still the one really interesting On Yeah, dynamic. we a has down

revenues with the our players, Ericssons, for come side. European at Huawei infrastructure down trade with but that able of infrastructure. the is position increasing have the of here result So more the been Nokias, us as position business they to down. Most the Fujitsu We've on Huawei the even a have come ban, zero, with not on offset

been Vivo, it a to with offset They right in been able time, to Huawei. we've same other large Oppo, adjacent well to were for do in worst diversify we've with So that, now on behind able in design continue say Xiaomi. headwind been – the And Again, but us the customer has a us, certainly wins quite markets side down and that would other at China, and Ericsson with spaces. slowly to the but it's players is coming we I Nokia. with been and respect infrastructure

we've a been that think storm, it I abating. a weathered bit has of but had been headwind, been but -- it's So

Blayne Curtis

Got another you. then maybe And Android. question on

perspective your on market. the to curious Just the of trajectory

XX% XG. mentioned You

your of good either you the to I as back curious Obviously, just the the just this XG market. year, think for perspective look at do mid-range curious in market year. you of I content you later perspective half to it's there think see coming of back reaccelerating handset been overall as of half. phones the are to is in on kind coming way. whether I'm your the the kind XG. expense I'm

Liam Griffin

Yes.

going is right. You're for be segments. all I an to XG mean, inflection

complex going have many it So, think opportunities basis, is we're at at have a content significant. return even the level technology the the the obviously Samsung, and relative on you content. if and end, of we about most the in China richest of to the highest But on that

be offered to XG $XX may $XX. for So in it could $X even you a a could that or world be in $X platforms to looking us, world be XG $X at

mid- than in some platforms a lower-end of there's So, may on the a basis, they ones. of relative and the larger in pop-up more be

you little stepped XG quite the large It we've with but really brands. on our technologies chance sights that's XG the prowess ones, high-performing kind much really done the bring. us. that at and populating little technology Now set more to can and course, a of well better units bit more out China us the the doing a have dense, a give right gives for we worked we've because of now, XG solutions and great and demonstrate from away Samsung bit there We're

combination meshing one a So we're that just create the do And supplier kind to the now for together. nice is of as of to things I going we it's customer. have think but that in right solution area, the well right a

a China So in one than SkyX do engine we may for or be Korea. what customer different somewhere in someone with very

Operator

question next Raymond of Your Chris the James. comes from from line Caso

Your line is open.

Chris Caso

where given evening. you. Thank granularity about little helping SkyX get I a where is competing against RF higher-end you to modems that. you'd traction against a that's seeing more more And Good that obviously what to about product a compete you're their talking they're with there, on give you Qualcomm regard and Yes. little that could Qualcomm's wonder where RF SkyX how be you're solution? to own if trying

Liam Griffin

Yes, Chris.

to that years technology to challenge. think been been was one XG this following of time the the is I inflections anyone have significant know this long a XG was challenge. much from a agree would and and but the with XG always I ago, XG industry XG that. things is harder. really you've to remember in for think to But XG that I was leap a

working Acoustic this we've And been of of years. these on This and ready all at us be has in in cultivating bread our wireless we're gallium our enabling precipice solutions the stuff. Bulk things butter. own to TC-SAW, positioned the the our crafting L.A. arsenide and one leveraging has for in and been that us that is markets right crafting Wave, technologies, and our and so Boston allowed own in bringing this bringing Working

depending eight in, we upon the but the XX that depending customer SkyX, SkyX So need, could we go upon permutations when call it to baseband. have

can So thread we with And an work agnostic. for us. They whoever. MediaTek to be Qualcomm, important work with want our baseband products that's they'll

solutions, us is customers makes solutions off solutions our the what there's just that's And unique. and think great but not create very, really seeing reference pick some what architectures, there own been point of design. I we've best a their to run baseband want So very out and

We than engagement know-how them ensuring more the So, the way see It's that in position at FAE understand that's it. It's have customers the product our the It's just to engagement. transfer over complexity that people put we win. XG. the to we Skyworks the can in and itself.

Chris Caso

Thank you.

from guess ability years. are like and What's fruits a sort of you I of on you’re company next cycle. generate starting use the follow-up, the your of this position you are really the see to what years. How to of And of the cash thinking This positioning you're XG this beyond cash question over sort company cash, the runs a that. And after in Liam For sounds historically cycle? the few going confident couple guys beyond use the you XG that It how to this? are cycle? plan and longer-term

Kris Sennesael

Yeah.

first a very So, of sheet positioned I think all, view. from well point of balance we're

We that will investments debt. cash cash, And to advancing continue the we have technology. major no billion lot the a $X.X make of generate fact of despite we

to invest We in continue will R&D.

our filter investments, course, continue share will from Most those dividend active to TC-SAW program. is we've power on major well as are integrated make factories more XX% on being of well as to business, generated well, the levels technology continue is dividend our XX% yes, back and continuing the combination as see BAW solutions. of so that's more driving all buyback as amplifiers, a And our can as the being in we As which revenue. to operating increased level, by shareholders, the running just in our and with returned But, our program. our advancing of our complex be to you cash invest we or expense in about CapEx, our to

Operator

Your Timothy from the comes Arcuri next from UBS. of question line

open. is Your line

Unidentified Analyst

I was give come color could wondering at on expected have more It the gross the seems a Tim. levels, to for little lighter there's for have us if in to is question. if anything bit there? Thanks additional we on revenue margin. out than call a This bit would you Seth these

Kris Sennesael

Yeah.

of I'm or with margin about guided pleased the in XX.X%. XX%. quarter. We all, We performance First did June gross on the

beat we by just points. So, that XX basis

just up to the XX.X% be range. XX% to September sequentially guided we into so, And

of So making margins, well is driven good own the of COVID-XX. There supply some more products bit assume overall time a will further the our of course, traction well. that, gross XG, to grow that headwind the with improving into a reduction headwind towards we costs to of at make in part will margin gross that work then, and improvements little as a we'll chain, as on the richer as execute mix over by our we is, as and But, will of on as we as to There mix, our actions, mix. cost more is overall see logistic continue continue disruption XG as continue in I we factories. the away our continue we line, And as XX%. a target result some -- top go that more

Unidentified Analyst

of just more revenue percent on some looks I was smartphones. And you. China revenue good other any was specifically color Thank follow-up. the if And color demand trended you you give little going kind forward. what the could how a us gave a bit details. of like Thanks. wondering, June, on China in kind wondering from of I just as maybe or

Kris Sennesael

Yes.

course, is revenue Huawei XX% China very of of approximately is Chinese overall other There's customers. of revenue. little Vivo, China, Xiaomi. Oppo, some then, So, that And left. total Mostly smaller

As really China. in Liam indicated off kicking is XG before,

those a There step-up is great big up to the our compared strongly basis customers. of a quarter. And on result the players year-over-year have with phones the phones. is with those content accelerate that, XG September we in further so, a And into and expected to relationship is in Chinese as revenues XG

Operator

next Your comes line the Charter Research. from Edward of Snyder Equity question from

is line Your open.

Edward Snyder

is it those all suppliers, Skyworks? BAW for you make BAW-enabled very on which your by XXX other lot. Thanks and sounds from it modules, The would given plan? side manufacturing of a modules, that BAW discussion power sense Liam still is good. coexist right up source Or have a your filters, XG, you And production then your be million out as started manufactured I have of like follow-up, of receive shipments that which please. duplexers? alley, lot is shipping a And do

Liam Griffin

all Sure. Well it our is news good under roof organic now. that, the

we've quite on a only while. in We've great for doing this labs, great this not also So been been to right. technologists working, Team’s the got get a working but job. factories, some in the

but XXX So I early know units innings. you out that there are billion million is technology to there's still X and is great, units both these that -- captured. be

question good. good way -- now. is still go, your looks second but true. So that's also of And so we're technology been some part And to the a long right the it's endorsed by really customers, important

BAW but up. in diversity receive important is not we're equally leveraging the bringing only side, technology speeds on the So transmit downlink

we're able Bulk Acoustic Wave. with to going be to populate ends So both

some to move seeking forward. looking as executing really forward we're going be to now we more and got So we're great we've there. customers out And traction

Edward Snyder

But right? given your most receive the side, strength then And of is in DRx, on that --

Liam Griffin

spectrum. to share also on lion's with Yes, it going But But it We've customers too. I that that and we're broaden the our us XG customers as the transmit add SkyX that we some the drive but side, some the for our customer and performing there can that certainly it make look think well. today. design simple have of And is, print been has a DRx there very reach to with want we start chain. solution, we think in engines I at today chain to in technology take and really TX can create use got unique highly wins

said, to indications I a going technology early are it's important be as us. And, strong. So, really for

Edward Snyder

transmit that sounds But at, the dual and the you, to they're to with would XG, China which address the is isn't to to than like head-to-head transmit you mobile what's trying Corvil. rather connectivity make going case Given the up duplex you coming of starting it with transmit? Avago especially to the looking on section, it actually in easier is or go for BAW a without DRx show it kind guys much in going

Liam Griffin

right That's correct. you're That on no, No, Yes. that. is correct.

that's the as create some in XG that opportunities solutions, as to unique So with up are door those opening we well. that going there is to see some technology partitioning us drive Yes, of for well. another

Operator

next question the Securities. Wells from comes Gary line Your Mobley of from Fargo

open. Your line is

Gary Mobley

on versus you mobile unit wanted being Hey, the At a the question, to market. asking I guys risk guys. softball of ask the relative of your performance accused about

Can math So your XXXX maybe and year-over-year of calendar units. through, growth? half us if well decline of in you first you've how the the backdrop year in a so mobile content in serves against and rank unit in correct share respect been to that's tough manage market XX% against order gains of handset sort -- particular me able drove with X% to walk a the growth and you my

Liam Griffin

Sure. That's a great question.

to try go a as I'll So we it. more get and go detailed high little level through maybe

the is and catalyst the think underpinning growth for I it's really XG genesis this. of inflection that's the here So --

they were didn't was either; you and So to exist, phone what XXXX you yet readied. almost early back right? XG. XXXX technologies XG, but being get They XG launched. or look The were if market XG just there everybody's is, hadn't

now They showed QX. So they're to launch up going the up show are up. strong QX and show to in initial our stages XG in of starting

additive content platforms. have. known that start is stuff we'll these to And known we for you with already XG customizable created XG incremental to what we that -- have content in laying that so specifically And the

add then to the whatever And $X print an So engine. have incremental XG it you want phone as of or a has already the top on maybe you $XX. $X engine XG that call you XG in content

So that's important. really

a that So it then now device have it's and to carries XG carries the you're high-performing going XG, high-complexity, engine. XG in XG still incremental carries

that's are early. we still this So big very very is cycle. a deal. early And in This

compelling that will. platforms and Some of have yet the we not most they know launched

lot a to have look we So forward there.

hundred billion subscribers, a carrying really It's years things. the stats growth said, in we have technology. units. could of couple how most about that's the number is next So five one look cited looks, a of profile XG that three that Today low. we we million When important over few think that

much And markets that to we've the to now need XG. cases other of The the delivered handset a usage faster technology are So XG great that in capturing in in much showing there's seen. for Wi-Fi and the addition there's be IoT opportunity work-from-home really X. do markets in or some could with

interesting coming propel are that together at significantly. themes So this time our can really right now business that some

Gary Mobley

that. Appreciate Okay.

about the question in As ask price point China. emergence wanted my I follow-up to mid-tier the of

sort year up compares million, your XXX same the in great So perhaps China where positioning in at has positioned I'm opens But that the in units XG in of tier and to driving first the XXXX China know curious XG how the price half of midyear of relative globally. you're market been the as portion XG? to

Liam Griffin

these and solutions unique had have mean very the breadth is developing done been most of And our Skyworks a base things position Oppo, is in to and to products these team and for to I get of so and Yes. up for to the great extremely it to has great difficult. into the; our close us knowledge have on launch. actually very the players when is and the really get had leverage solutions with in side China line the brands launch we XG on them good But already. but that, to Skyworks, not our We've very just FAE technology matter. XG people the really the allowed these to with that partnership well that names good we for I that a technologies. the a and having at hardware Xiaomi able a part we become XG been the said very be one China partner the and partnership. get We've reputation Vivo, it's names side, really market well. that

and great happening a where you in at five units there's globally be could if huge there's -- think we still look opportunity in there's It's China. But years already units a So I upside. total now. said, as

Operator

Ellis FBR. Your from of B. the line comes next question Craig from Riley

is line open. Your

Craig Ellis

question, module for execution back better. on a job Thanks wanted business the the Liam, little taking understand to and Yeah. just nice bit I and go the guys. BAW

release, looks markets. up mobile like it quarter XX% about shipping press looks XXX the broad we're last BAW in like it shipments from So million. were the But both and at integrated on you're modules

us next module but some mobile, integrated you the even now? six give ramp split markets units to that can bigger. broad quarters, how And units you in BAW be will four for play sense the huge over out splits So as that ultimately significantly does how We've in IoT out? got

that long-term? see you do to intermediate out how playing So

Liam Griffin

that's Yeah. question. a Yeah. No good

with XX% for solutions And SkyX. are right those we're Acoustic So most part, probably in Wave mobile now integrated the again our Bulk solutions. XG

great We're seeing a opportunity are in integrated like solution, a technologies We Wi-Fi. it creates within Wi-Fi filtering performance. technical our growing using

about but between device than eight an eight where so if much units are filters modules, produce as opportunity billion. the opportunity. we're technology. We're statistic far, difference BAW did And more potentially. a XXX what be I the there's before, the crafting that, our that where more we done a of just great. But that's still billion could number and in we've year, think we just two technologies BAW the say about We with said going But we in manufacture happy incredible we've that you So will We're TC-SAW the are filters to to so we're about TC-SAW There have. doing we like go. it's that in million.

clear because are sockets BAW sight right print a has are line and device going if mobile, be of to there's that address. that right, there the So mobile could today we in there now

broad some a going solutions were be IoT of we markets, wireless we unwire to power do Wi-Fi try before. wired kind in into performance leveraging Acoustic As these that they technologies weren't will teachable Maybe try maybe a of that of some for the in to and will them. Bulk more us. Maybe it We're we Wave. basically create move to

to know we market back opportunities will space. be us today those mobile, which in But individual then out see capture to every much can hood we it. under go the IoT that the going it's it's So specific and more to and with solutions on so go directly well customer we're and

Craig Ellis

helpful. to that longer then question term. you're and seeing follow-up both really near-term related is Then That's the the

performance that the the business got you've as plus per do ran $X entity now quarter. Buzzsaw's, good business and trends business at the seeing clearly was list the is strong yours December quarter. we and look seasonally the So very before September term The quarter a of billion right in growing for very guidance trade question could into and and robustly you're industry very COVID longer is this

billion you're you you the in As design at business of next and level? this do your when you for is really your can $X like extending half point be look come at pipeline into a the Or the year? starting that year, wins to get going feel visibility as should to that quarter Thanks get through you next back to first to Liam. that work things well

Liam Griffin

I that technologies. about you more what hard front a it great a us to No And because do really were, fabless It's the now the difficult. to years opportunity hard in to billion ago. that's favorable you think been but actually have is people also the do. Yeah. play are a we really have -- And have not talking we've was three do $X XG at I to play. certainly conducive know have we technologies experience there with great have to of to And these point you say -- level. We the it and right? than how quarter and much is

You've craft the stuff. to got

daunting That's well. to to for well So, I going inflection factory, the the customers' your that's that that installation think going us. your an FAEs, to requires performance from play fact we're right into technological if going years play of work. years work be the technology, in starting work this into and for didn't that of put are where the flow to really we years now we us. And we direction right wouldn't And XX is to

And itself forward And just looking continue care to know has that prepared really going is that. We to to usage we the talked think the think important. And I we're clear this design revenue about So, hopefully been it remarks, wins. thing now the are the the cases of other pandemic. is content time don't take around to I knock right is when we increasing. I connectivity away out in go this going over the if

think around the used wireless be lasting I performance going connectivity and by be and to masses. behavior it's there's some to going

ago, to portfolio our for be it's we're we theme about positive around we but new starting a -- quite that's could that So, or now really two that something see thinking weren't Skyworks. a that something year as and

Operator

from from Cowen. last of question comes Ackerman Karl Our the line

Your line is open.

Karl Ackerman

of appreciate quarters do first What think kind while letting the production half? focus production plans I the with been for context may seeing of consumer gentlemen. question. we've there's weaker next investor COVID-XX. seem I consternation I the that good near-term. have visibility extremely second the on wanted Hey, you ask a to afternoon just into sort you I plans just me demand challenges orders several because ask improving some over in the strong, fall on of

expectations that gross you the and several of quarters? your margin do context handicap how guess depletion in the inventory over I So, next

Liam Griffin

Yes.

seen good continue all I we situation we don't very that we've But we demand it. and visibility volatility core lightly right right with have strong the position to understand we take now some into mean COVID have a of -- So, backlog now and that all. we with see technologies. very the

the looking situation. Kris and and second very But execute it periods year. we half a We have the other I'll talk inventory little -- good ahead position to through more time, that. to go all where we're of of the looking let now execute bit at in are about is at a

Kris Sennesael

quarter. expect sequential is strong growth comfortable just guided growth right very Yes. where a December and we into given we very sequential -- that level the September we feel the now further No, I are strong into inventory and

loading to that is usage order been to the of minimize then on trying on expenditures the equipment capital orders drive and have of factories our and inventory have we that maximum in We so capital our we firm based backlog and have most books. our

for So, E&O. there is very little risk

our grow serve able and good to an of about customers the view we being to point and in as business And so really inventory continue September are I where from December. feel

Karl Ackerman

I'd seem a you be love MediaTek driver you. year growing next the Great. And that handsets follow-up baseband on healthy opportunity for -- mid-tier opportunity Thank or you to the at targeting I XG over are may hear for would to my your content two? if thoughts to but low agnostic,

Liam Griffin

as Yes, China one great got absolutely. players the other and on know markets. of a lot baseband MediaTek they're key you emerging a new feeder there. number performance doing I of platforms. We've even their of agnostic great And is We're in work into the agree. good world. for us system a

-- not DRx XG. only starting talked right platforms in we're $X in done So them different good a have with job do volumes we about their in receive -- are up and great that helping we We've We've our to $X now are XG. MediaTek got really question. of have some but a side technology growing. in that on And are we to now XG transmit we've chain, some got them pick

while, starting MediaTek, the in but So China they've to a a emerge for around the they're in leader and landscape. really as emerging markets been again

Vivo, that great baseband Very Oppo, MediaTek you have with solutions have alignment and we as of the we often lot a talked names the Xiaomi. a well. MediaTek supporting that those baseband they're inside So about

they've end. their great and we So been on a partner us for see momentum

Operator

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

Liam Griffin

all conferences. to at seeing Thank Thank you. We you look for participating call. upcoming you on today's forward

Operator

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

Skyworks Solutions (SWKS) 23 Jul 202020 Q3 Earnings call transcript