Tag Archives: avgo

Skyworks Guidance Lags By $50 Mil On Petering Apple iPhone Demand

Apple ’s ( AAPL ) “iPhone drag” tugged Skyworks Solutions ’ ( SWKS ) fiscal Q3 guidance by $50 million late Thursday, prompting shares of radio-frequency chip rivals Broadcom ( AVGO ) and Qorvo ( QRVO ) to topple early Friday. Skyworks stock led a broad Apple chip sphere fall, down 4.5%, near 68, in morning trading on the stock market today . Shares of competitors Broadcom and Qorvo were down a respective 2% and 2.5%. NXP Semiconductors ( NXPI ), Qualcomm ( QCOM ) and InvenSense ( INVN ) stocks followed, down 1%, 3% and 4%, respectively. Apple stock was down 2%. For its fiscal Q2, which ended April 1, Skyworks reported $775.1 million in sales and $1.25 earnings per share minus items, in line and topping the consensus of 25 analysts polled by Thomson Reuters for $775.6 million and $1.24. But EPS slipped to single-digit growth for the first time in 13 quarters, rising 9% year over year. Sales rose 2%, in the single-digit range for the first time in 14 quarters. Both metrics have decelerated for five consecutive quarters. Current-quarter guidance for $750 million in sales and $1.21 EPS ex items would be down 7% and 10%, respectively, vs. the year-earlier quarter. On a year-over-year basis, sales have never declined in the past five years. EPS has declined twice, but this quarter’s decline would be the biggest. And both metrics lagged the consensus for $800.5 million and $1.32. Mizuho analyst Vijay Rakesh blamed the “iPhone drag” for Skyworks’ weak guidance. On Tuesday, Apple reported its first year-over-year decline in iPhone sales and its first quarterly revenue drop in 13 years. Apple CEO Tim Cook said Tuesday that the company planned to cut channel inventories in the June quarter “in light of the macroeconomic environment.” Late Tuesday, supplier Cirrus Logic ( CRUS ) offered Q3 guidance that also missed Wall Street views. But Skyworks expects a strong September quarter, with 20% and 40% content gains at Samsung and Huawei. On average, Chinese smartphones are growing content by 20% year over year, Rakesh wrote in a research report. Rakesh cut his price target on Skyworks stock to 99 from 105 but reiterated a buy rating. Cowen analyst Timothy Arcuri estimates that 40 million to 50 million iPhones will be sold in the June quarter, leading to better upside in Skyworks’ fiscal Q4. But he adds that Qorvo might be a stronger RF competitor now. Both analysts suggest that Skyworks look to diversify amid the slowing Chinese and iPhone markets. Arcuri reduced his price target on Skyworks stock to 76 from 78 and kept his market perform rating.

Why Apple’s Stock Chart Action Is So Significant

Apple ’s ( AAPL ) second-quarter earnings miss is sending shares way below a critical level. Its ecosystem of suppliers is feeling some heat but holding up relatively well if not rising. The consumer tech giant’s EPS fell 19% to $1.90 while revenue dropped 13% to $50.6 billion. Both missed Wall Street views; so did Apple’s Q3 revenue outlook. Apple reported its first-ever year-over-year iPhone sales decline , a 16% drop to a little over 51 million units. The stock is plunging 6% in giant volume in the stock market today , breaching the key downward-sloping 50-day moving average as it gaps way down. After trending lower for several months, the 50-day line began to move higher along with Apple shares, until recently. Shares are now trading 27% below their all-time high, reached a year ago. IBD’s Take: How healthy is Apple stock? Find out at IBD Stock Checkup Meanwhile, Apple supplier Broadcom ( AVGO ) fell to its 50-day line, briefly moved higher but is down fractionally. Skyworks Solutions ( SWKS ) fell 2% after briefly turning higher. Skyworks looks to have hit resistance at its 50-day line. Qualcomm ( QCOM ) is down fractionally after paring its losses. Qualcomm is trading in between its 50-day and 200-day lines and is about 26% below its 52-week high. Meanwhile, Cirrus Logic ( CRUS ) was down as much as 5.5% in premarket trade but quickly reversed higher for a 6% intraday gain, back above its 50-day line, as it beat quarterly results late Tuesday. Cirrus Logic’s current-quarter revenue guidance was light.

Apple Stock Dives After iPhone Sales Fall For First Time Ever

Apple ( AAPL ) late Tuesday reported its first-ever year-over-year decline in iPhone sales and its first quarterly revenue drop since 2003. To soften the blow, Apple increased its dividend and share buyback plan. CEO Tim Cook also said business was “healthy” and that Apple has an “amazing” product pipeline. But the stock still fell nearly 8% in after-hours trading following the earnings release. During the regular trading session Tuesday, Apple stock fell 0.7% to 104.35, closing just above its 50-day moving average. Key iPhone chip suppliers Broadcom ( AVGO ), NXP Semiconductors ( NXPI ) and Skyworks Solutions ( SWKS ) also fell after hours. For its fiscal second quarter ended March 26, Apple earned $1.90 a share on sales of $50.6 billion, both missing views. On a year-over-year basis, earnings per share fell 18.5% while sales dropped 13%. Analysts polled by Thomson Reuters expected Apple to earn $2 a share on sales of $51.97 billion in the March quarter. Apple topped estimates for iPhone sales in the quarter, but still saw a sharp drop. It sold 51.19 million iPhones in fiscal Q2, down 16% from a year earlier. Financial analysts on average were looking for Apple to sell about 50 million iPhones during the March quarter. Greater China sales, including Taiwan and Hong Kong, tumbled 26% to $12.49 billion, after soaring 71% in the year-earlier quarter. For the current Q3, Apple is targeting overall revenue of $42 billion, based on the midpoint of guidance, which is well below estimates. It did not give an EPS target. Wall Street was modeling for Apple to earn $1.76 a share, down 5%, on sales of $47.32 billion, also down 5%, in the June quarter. $50 Billion For Shareholders Apple said its board authorized an increase of $50 billion to the company’s program to return capital to shareholders. Under the expanded program, Apple plans to spend a cumulative total of $250 billion of cash by the end of March 2018. As part of the updated program, the share repurchase authorization was raised to $175 billion from the $140 billion level announced last year. Apple also increased its quarterly dividend by 10% to 57 cents a share. Apple has signaled a hiring slowdown by cutting all of its contract recruiters in recent weeks, VentureBeat reported Monday . It also is laying off some full-time recruiters as well, the news website said. In all, more than 100 people were impacted by the moves. Gross Profit Margins Declining Apple’s gross profit margin dipped to 39.4% in Q2 vs. 40.8% a year earlier. Apple expects its gross margin to decline again in the current quarter, to 37.5%-38%. CEO Tim Cook described Q2 as a “challenging quarter.” “Despite the pause in our growth, our results reflect excellent execution by our team in the face of ongoing macroeconomic headwinds in much of the world and difficult year-over-year comparisons,” Cook said on a conference call with analysts. Apple faced currency weakness in most of its international markets. In constant currency, Apple’s revenue declined by 9% year over year, Cook said. Despite the decline in iPhone sales, Apple’s smartphone business remains “healthy and strong,” Cook said. Apple continues to see a high level of people switching from Android smartphones and other platforms, he said. Apple’s iPhone business accounted for 65% of the company’s total revenue in Q2. Apple also saw declines in its iPad and Mac computer businesses. Sales of iPads declined 19% in units and revenue in Q2. Mac sales fell 12% in units and 9% in revenue in the March quarter. Cook hinted at exciting products ahead. Analysts believe Apple is working on an electric car and an Internet TV service, among other things. “The future of Apple is very bright,” Cook said. “Our product pipeline has amazing innovations in store. … We are forging ahead with important investments in research and development, in our infrastructure and our supply chain. We’ve made 15 acquisitions in the last four quarters to accelerate our product and services road map and we’re always on the lookout for companies with great technology, talent and strategic fit.”