Skyworks Earnings: Cutting Our Valuation to $115 From $133 as Firm Expects to Lose Content at Apple

Narrow-moat Skyworks Solutions reported decent fiscal second-quarter results. Still, it provided investors with a disappointing outlook for the June quarter and, more importantly, hinted at 10% lower dollar content in the next wave of Apple iPhones coming to market in late 2024, which should weigh on fiscal 2025 revenue. We don’t believe the lost content is associated with an in-house Apple product, nor is it the start of a death spiral for the company’s relationship with Apple. Still, it provides yet another headwind to future radio frequency revenue growth. We cut our fair value estimate to $115 from $133. Shares sold off as much as 9% after hours to $96, so still have a modest margin of safety for investors today.