Skyworks slips as dividend halt, chip selloff overshadow earnings beat
SWKS•Shares fall despite earnings beat
Chipmaker Skyworks Solutions' shares SWKS.O fell 2.6% to $62.97 amid a broader selloff in semiconductor stocks.
SWKS posted Q3 adjusted EPS of $1.08 and revenue of $935 million, both beating analysts' consensus estimates of $1.02 and $920.3 million, according to data compiled by LSEG.
Growing demand for radio-frequency chips used in smartphones helped the company beat results.
Dividend halted as buyback begins and analysts trim targets
The company said it will halt its quarterly dividend and launch a $2 billion buyback as the Qorvo QRVO merger advances.
"New capital allocation strategy post QRVO deal entails discontinuation of the quarterly dividend as the company focuses on deleveraging and share repurchases," TD Cowen analysts said.
Several brokerages including J.P. Morgan, Morgan Stanley, BofA, Citigroup, TD Cowen and Stifel cut their price targets.
Morningstar sees rising memory-chip costs driving higher smartphone prices, potentially pressuring handset volumes in fiscal 2027 and beyond.
Three of 25 brokerages rate the stock "buy" or higher, 19 "hold" and three "sell" or lower; median PT is $70.
Including the session's move, the stock was down 0.6% year to date, while the broader chip index .SOX was up nearly 50%.
