Analog semiconductor manufacturer Skyworks Solutions (NASDAQ: SWKS) recently reported strong fiscal first-quarter results that came in ahead of management's guidance. Traders cheered the report, sending shares up by double digits.
While Skyworks' press release had a lot of good information to share, the company's conference call is also a great source of additional insights. Below are five must-read quotes from the call.
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On diversifying the business
One of the biggest knocks against Skyworks is that the company is overly reliant on Apple (NASDAQ: AAPL). That argument holds water today, as the Mac maker still accounts for more than 40% of Skyworks' total revenue.
However, management affirmed on the call that the company is growing quite well with all of its customers, not just Apple. Here's what CEO Liam Griffin had to say about the company's growth excluding its "largest customer":
CEO Griffin also rattled off several examples of new-design wins or expanding relationships with these other customers. Specifically, he called out relationships with companies such as Comcast, Netgear, Ubiquiti Networks, Xiaomi, "multiple tier 1 OEMs," among others.
On returning to year-over-year growth
Apple's decision in 2016 to reduce its channel inventory levels had a big impact on Skyworks. In fact, Skyworks revenue declined year over year in each of the last three quarterly reports, which isn't something that growth investors like to see.
Thankfully, CFO Kris Sennesael says that the days of declining sales growth are over:
For the upcoming quarter, management is guiding for revenue growth of 8% and earnings-per-share growth of 12%. That's got to make bulls smile from ear to ear.
On the next phase of growth
It is possible that smartphone sales are nearing a plateau, so Skyworks likes to remind investors that a few technologies will be hitting the mass market soon that could drive the company's next phase of growth. Specifically, management remains uber-bullish on the opportunities that will be opened up once 5G network technology and autonomous driving become a part of everyday life.
Here's CEO Griffin talking about the potential of 5G network technology:
And Griffin commenting on the extreme data needs of autonomous vehicles:
On taking care of shareholders
Skyworks has been returning its excess capital to shareholders for years in the form of buybacks and dividend payments. Here's CFO Sennesael commenting on the company's recent actions to continue to reward shareholders:
All in all, Skyworks delivered an excellent quarter, and provided shareholders with plenty of reasons to remain optimistic.
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Brian Feroldi owns shares of Apple. The Motley Fool owns shares of and recommends Apple and Skyworks Solutions. The Motley Fool has the following options: long January 2018 $90 calls on Apple, short January 2018 $95 calls on Apple, short August 2017 $87 calls on Skyworks Solutions, and short August 2017 $85 puts on Skyworks Solutions. The Motley Fool recommends Netgear and Ubiquiti Networks. The Motley Fool has a disclosure policy.