Skyworks Loses Apple Business, Stock Plummets
Key Points:
* Skyworks Solutions (SWKS) stock dropped nearly 25% after announcing loss of Apple (AAPL) business.
* Apple is dual-sourcing radio frequency chips, reducing demand for Skyworks' products by 20-25%.
* Analysts speculate Broadcom (AVGO) as Apple's secondary supplier.
* Skyworks previously lost business to Qualcomm (QCOM) and the latest move could impact revenue by $600 million by 2025.
* Company announces CEO shake-up with Philip Brace replacing Liam Griffin.
Skyworks Losses Apple Business
Skyworks, a major supplier to Apple, has seen its stock plummet following the announcement of losing a significant portion of its business with the iPhone maker. According to Skyworks CFO Kris Sennesael, Apple is now sourcing chips from a competitor, which analysts believe to be Broadcom. This move is estimated to reduce Skyworks' demand by up to 25%.
Analysts React
Analysts have downgraded Skyworks' stock in response to the news. Stifel analyst Ruben Roy downgraded the stock to "Hold" while TD Cowen analyst Krish Sankar estimates a $600 million impact on Skyworks' revenue by 2025. Citi analyst Atif Malik maintained his "Sell" rating, citing Apple's potential shift to in-house modems as a potential tailwind for Skyworks.
CEO Shake-up
Amidst the turmoil, Skyworks has also announced a shake-up in its leadership, with former Intel executive Philip Brace replacing longtime CEO Liam Griffin. Analysts have raised concerns about the timing of this change given the company's current challenges.