Shares of Skyworks Solutions (NASDAQ: SWKS) fell by 16% in November, according to data from S&P Global Market Intelligence , after the company reported fiscal fourth-quarter earnings results. Mounting fears regarding demand for Apple 's newest iPhones also likely contributed to the decline.
Revenue in the fourth quarter had hit a record $1 billion, resulting in non- GAAP earnings per share of $1.94. That bottom-line result topped the company's own guidance by $0.03 per share. Non-GAAP gross margin expanded 30 basis points on a sequential basis and came in at 51.2% for the quarter. Fiscal 2018 revenue grew 6% to $3.9 billion, and Skyworks continues to work on 5G wireless technologies.
However, guidance left a bit to be desired , particularly as investors worry that demand for the latest iPhones may be lukewarm. Representing a full 47% of sales last fiscal year, Apple is by far Skyworks' largest customer.
Skyworks issued a forecast for the fiscal first quarter calling for revenue in the range of $1 billion to $1.02 billion, which should translate into non-GAAP earnings per share of $1.91. Notably, Skyworks pointed to "unit declines in premium smartphones" as a contributing factor in the outlook. Other notable iPhone suppliers have similarly been issuing their own warnings regarding the coming quarter, forming a constellation of data points that is only exacerbating investor sentiment around the Mac maker and its suppliers.
On the earnings call last month , Skyworks CEO Liam Griffin assured analysts that the company's "content position is solid," so it's not that Skyworks is losing design wins at Tier 1 manufacturers to competitors. "So it's not a case where we fumbled and didn't execute or weren't able to win the sockets that we pursued," Griffin added. While Apple has for years been trying to shift a core part of its investing thesis toward its services business, hardware component suppliers don't have that luxury, so the global smartphone market's slowing growth will weigh on those companies' prospects.
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Evan Niu, CFA owns shares of AAPL. The Motley Fool owns shares of and recommends AAPL and Skyworks Solutions. The Motley Fool has the following options: long January 2020 $150 calls on AAPL and short January 2020 $155 calls on AAPL. The Motley Fool has a disclosure policy .