Skyworks Solutions, Inc. EBITDA dropped on 18.2% and EBITDA Margin decreased on 2.6 pp from 41.8% to 39.2%
11/12/2019 • About Skyworks Solutions, Inc. (
$SWKS) • By InTwits
Skyworks Solutions, Inc. reported FY2019 financial results today. Here are the key drivers of the company's long term financial model:
- Skyworks Solutions, Inc. has medium CAPEX intensity: 5 year average CAPEX/Revenue was 10.0%. At the same time it's a lot of higher than industry average of 7.8%.
- The company has highly profitable business model: ROIC is 23.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 12.7%. Revenue decline showed acceleration in FY19Q4 - it was 18.0% YoY. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 2.6 pp from 41.8% to 39.2% in FY2019.
Gross Margin decreased on 2.9 pp from 50.4% to 47.5% in FY2019. During the last 5 years Gross Margin topped in FY2016 at 50.6% and was declining since that time. SG&A as a % of Revenue increased slightly on 0.50 pp from 5.4% to 5.9% in FY2019.
Net Income margin increased slightly on 1.5 pp from 23.7% to 25.3% in FY2019.
Investments (CAPEX, working capital and M&A)
Skyworks Solutions, Inc.'s CAPEX/Revenue was 11.8% in FY2019. CAPEX/Revenue increased on 6.0 pp from 5.8% in FY2016 to 11.8% in FY2019. It's average level of CAPEX/Revenue for the last three years was 10.3%. During the last 5 years CAPEX as a % of Revenue bottomed in FY2016 at 5.8% and was growing since that time.
Return on investment
The company operates at high and attractive ROIC (23.2%) and ROE (20.8%). ROIC decreased on 9.2 pp from 32.3% to 23.2% in FY2019. ROE decreased slightly on 1.7 pp from 22.5% to 20.8% in FY2019. ROIC stuck to a declining trend at -2.8 pp per annum in FY2015-FY2019. ROE followed a declining trend at -2.2 pp per annum in the last 5 years.
Leverage (Debt)
The company has no debt. Cash surged on 16.1%.
Valuation and dividends
The company's trades at EV/EBITDA 12.5x and P/E 20.4x.
Financial and operational results
FY ended 09/27/2019
Skyworks Solutions, Inc. ($SWKS) key annual financial indicators| mln. $ | 2015 | 2016 | 2017 | 2018 | 2019 | 2019/2018 |
|---|
P&L
|
|---|
| Revenue | 3,258 | 3,289 | 3,651 | 3,868 | 3,377 | -12.7% |
| Gross Profit | 1,555 | 1,665 | 1,842 | 1,951 | 1,604 | -17.8% |
| SG&A | 191 | 196 | 205 | 208 | 198 | -4.6% |
| EBITDA | 1,219 | 1,367 | 1,509 | 1,619 | 1,324 | -18.2% |
| EBIT | 1,023 | 1,119 | 1,254 | 1,319 | | |
| Tax | 225 | 205 | 247 | 414 | | |
| Net Income | 798 | 995 | 1,010 | 918 | 854 | -7.1% |
| Stock Based Compensation | 43 | 34 | 48 | 108 | | |
Balance Sheet
|
|---|
| Cash | 1,044 | 1,084 | 1,617 | 733 | 851 | 16.1% |
| Accounts Receivable | 538 | 417 | 455 | 656 | | |
| Inventory | 268 | 424 | 494 | 490 | | |
| Accounts Payable | 291 | 110 | 258 | 230 | | |
| Short Term Debt | 0 | 0 | 0 | 0 | 0 | |
| Long Term Debt | 0 | 0 | 0 | 0 | 0 | |
Cash flow
|
|---|
| Capex | 430 | 189 | 303 | 422 | 398 | -5.7% |
| Dividends | 123 | 201 | 215 | 243 | | |
| Acquisitions | 25 | 56 | 14 | 404 | | |
Ratios
|
|---|
| Revenue growth | 42.2% | 0.9% | 11.0% | 5.9% | -12.7% | |
| EBITDA growth | 77.2% | 12.1% | 10.4% | 7.3% | -18.2% | |
|
|---|
| Gross Margin | 47.7% | 50.6% | 50.4% | 50.4% | 47.5% | -2.9% |
| EBITDA Margin | 37.4% | 41.5% | 41.3% | 41.8% | 39.2% | -2.6% |
| EBIT Margin | 31.4% | 34.0% | 34.3% | 34.1% | |
| SG&A, % of revenue | 5.9% | 6.0% | 5.6% | 5.4% | 5.9% | 0.5% |
| SBC, % of revenue | 1.3% | 1.0% | 1.3% | 2.8% | |
| Net Income Margin | 24.5% | 30.3% | 27.7% | 23.7% | 25.3% | 1.5% |
| CAPEX, % of revenue | 13.2% | 5.8% | 8.3% | 10.9% | 11.8% | 0.9% |
|
|---|
| ROIC | 36.4% | 33.7% | 33.1% | 32.3% | 23.2% | -9.2% |
| ROE | 28.1% | 29.7% | 26.6% | 22.5% | 20.8% | -1.7% |
| Net Debt/EBITDA | -0.9x | -0.8x | -1.1x | -0.5x | -0.6x | -0.2x |
People
|
|---|
| Insider ownership | 0.4% | 0.4% | 0.4% | 0.4% | | |
| Employees | 6,700 | 7,300 | 8,400 | 9,400 | | |
| Revenue/Employee, th. $ | 486 | 451 | 435 | 411 | | |
Skyworks Solutions, Inc. ($SWKS) key quoterly financial indicators
| mln. $ | FY19Q1 | FY19Q2 | FY19Q3 | FY19Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 972 | 810 | 767 | 827 | | -7.6% | -11.3% | -14.2% | -18.0% |
| EBITDA | 414 | 330 | 253 | 327 | | -8.5% | -8.6% | -33.6% | -22.9% |
| Net Income | 285 | 214 | 144 | 211 | | 304.8% | -22.5% | -49.7% | -26.1% |
Balance Sheet
|
|---|
| Cash | 1,086 | 816 | 743 | 851 | | -35.4% | -56.6% | -35.8% | 16.1% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 50.0% | 49.0% | 41.0% | 49.0% | | -1.0% | -1.2% | -9.5% | -0.9% |
| EBITDA Margin | 42.6% | 40.7% | 33.0% | 39.5% | | -0.4% | 1.2% | -9.6% | -2.5% |
| Net Income Margin | 29.3% | 26.4% | 18.8% | 25.5% | | 22.6% | -3.8% | -13.3% | -2.8% |
Peers in Semiconductors
Below you can find Skyworks Solutions, Inc. benchmarking vs. other companies in Semiconductors industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| NanoFlex Power Corp ($OPVS) | | | 72.5% | 354.8% | |
| MoSys, Inc. ($MOSY) | -18.4% | 37.2% | 46.8% | 87.7% | |
| SMART Global Holdings, Inc. ($SGH) | | -16.9% | 42.5% | 69.3% | |
| Micron Technology, Inc. ($MU) | | | 63.9% | 49.5% | -23.0% |
| Adesto Technologies Corporation ($IOTS) | 4.3% | 1.6% | 27.6% | 48.8% | |
| |
|---|
| Median (68 companies) | 10.6% | 6.1% | 10.9% | 4.4% | -7.2% |
|---|
| Skyworks Solutions, Inc. ($SWKS) | | 0.9% | 11.0% | 5.9% | -12.7% |
Top companies by Gross margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| CEVA, Inc. ($CEVA) | 90.9% | 91.6% | 92.1% | 89.8% | |
| NVE Corporation ($NVEC) | 80.3% | 76.1% | 78.5% | 79.0% | |
| Rambus, Inc. ($RMBS) | 84.7% | 80.1% | 79.9% | 76.8% | |
| Universal Display Corporation ($OLED) | 64.2% | 83.9% | 80.8% | 75.5% | |
| Intermolecular, Inc. ($IMI) | 57.4% | 66.5% | 67.5% | 70.3% | |
| |
|---|
| Median (67 companies) | 47.7% | 47.2% | 48.6% | 50.2% | 45.7% |
|---|
| Skyworks Solutions, Inc. ($SWKS) | 47.7% | 50.6% | 50.4% | 50.4% | 47.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| NVE Corporation ($NVEC) | 66.0% | 61.8% | 65.6% | 65.1% | |
| Micron Technology, Inc. ($MU) | | 25.4% | 47.9% | 65.0% | 54.7% |
| NXP Semiconductors N.V. ($NXPI) | 41.5% | 21.6% | 46.2% | 49.9% | |
| Texas Instruments Incorporated ($TXN) | 42.0% | 43.5% | 46.7% | 48.6% | |
| Intel Corp ($INTC) | 41.0% | 35.2% | 41.7% | 45.7% | |
| |
|---|
| Median (68 companies) | 10.6% | 9.2% | 10.7% | 9.3% | 0.9% |
|---|
| Skyworks Solutions, Inc. ($SWKS) | 37.4% | 41.5% | 41.3% | 41.8% | 39.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Alpha and Omega Semiconductor Limited ($AOSL) | 6.6% | 6.5% | 12.2% | 42.2% | |
| Renesola Ltd. ($SOL) | 0.0% | 0.0% | 78.0% | 41.7% | |
| First Solar, Inc. ($FSLR) | 4.0% | 7.9% | 17.5% | 33.0% | |
| Sigma Designs Inc ($SIGM) | 6.5% | 6.2% | 14.1% | 29.3% | |
| Micron Technology, Inc. ($MU) | | 46.9% | 23.3% | 29.2% | 41.8% |
| |
|---|
| Median (68 companies) | 4.0% | 3.6% | 4.7% | 4.2% | 14.9% |
|---|
| Skyworks Solutions, Inc. ($SWKS) | 13.2% | 5.8% | 8.3% | 10.9% | 11.8% |
Top companies by ROIC, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| SMART Global Holdings, Inc. ($SGH) | | 2.5% | 21.5% | 51.7% | |
| Texas Instruments Incorporated ($TXN) | 29.8% | 34.9% | 43.1% | 47.5% | |
| Micron Technology, Inc. ($MU) | | 0.8% | 21.5% | 42.9% | 18.5% |
| Applied Materials Inc ($AMAT) | 15.2% | 19.0% | 31.2% | 36.4% | |
| NVIDIA Corporation ($NVDA) | 13.3% | 13.1% | 27.3% | 35.3% | |
| |
|---|
| Median (76 companies) | 3.6% | 1.4% | 3.2% | 2.2% | -2.9% |
|---|
| Skyworks Solutions, Inc. ($SWKS) | 36.4% | 33.7% | 33.1% | 32.3% | 23.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| MACOM Technology Solutions Holdings, Inc. ($MTSI) | 3.3x | 3.0x | 7.2x | 98.6x | |
| Inphi Corporation ($IPHI) | -6.4x | 4.5x | 33.7x | 32.2x | |
| JinkoSolar Holding Company Limited ($JKS) | 3.3x | 4.1x | 11.0x | 8.2x | |
| Lattice Semiconductor Corporation ($LSCC) | | 6.5x | 19.0x | 3.9x | |
| Renesola Ltd. ($SOL) | 35.0x | 123.6x | 2.3x | 3.3x | |
| |
|---|
| Median (45 companies) | -0.2x | 0.4x | 0.4x | 0.3x | 0.5x |
|---|
| Skyworks Solutions, Inc. ($SWKS) | -0.9x | -0.8x | -1.1x | -0.5x | -0.6x |
