A fixed rule set over this filing's XBRL figures and the number of high-severity risks found in it — no model judgement.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
In fiscal Q3 2026 (quarter ended July 3, 2026), Skyworks reported net revenue of $934.8M, down 3.1% year-over-year, with net income margin compressing to 3.6% from 10.9% due to lower gross margin, higher R&D/SG&A spend, and elevated restructuring/transaction charges tied to the pending Qorvo merger.
Filed · Source: SEC EDGAR 10-Q filing
SWKS fiscal Q3 2026 revenue fell 3.1% YoY to $934.8M while net income margin dropped sharply to 3.6% amid Qorvo merger-related costs and restructuring charges.
Last 4 quarters: 4 beats
Net revenue decreased 3.1% to $934.8 million for the three months ended July 3, 2026 versus $965.0 million a year earlier, primarily due to a decrease in market share at a significant customer, partially offset by increased demand for automotive and data center products.
Source: 10-Q Item 2 MD&A, p.21
Gross profit fell 6.5% to $375.0 million, with gross margin declining to 40.1% from 41.6% a year ago, primarily due to unfavorable product mix, partially offset by higher unit volumes.
Source: 10-Q Item 2 MD&A, p.21
SG&A rose 10.5% to $98.7 million driven by professional services costs related to the ongoing Qorvo transaction, while restructuring, impairment, and other charges surged to $19.8 million (2.1% of revenue) from $1.5 million a year earlier due to facility consolidation and closure costs; the $22.0 billion cash-and-stock merger with Qorvo remains subject to FTC Second Request review, with both parties having certified substantial compliance.
Source: 10-Q Item 2 MD&A, p.19-22
Research and development expenses grew 4.2% to $207.8 million (22.2% of revenue, up from 20.7%), reflecting increased headcount-related investment in developing new technologies and products.
Source: 10-Q Item 2 MD&A, p.21
Cash, cash equivalents, and marketable securities decreased to $813.8 million, down $574.6 million from October 3, 2025, driven by $500.0 million repayment of 1.80% Senior Notes due 2026, $106.9 million in dividend payments, and $87.1 million in capital expenditures, partially offset by $70.4 million of cash generated from operations.
Source: 10-Q Item 2 MD&A, p.19,24
The pending $22.0 billion merger with Qorvo remains subject to FTC review under a Second Request issued February 5, 2026, and other regulatory approvals; there can be no assurance the closing will occur on the anticipated timeline. Termination fees of up to $298.7 million (or $100.0 million under certain antitrust-related circumstances) could be payable if the deal fails to close.
Source: 10-Q Item 2 MD&A, p.19-20
Net revenue decline for the quarter was driven primarily by a decrease in market share at a significant customer, indicating continued reliance on a concentrated customer base whose purchasing patterns materially affect results.
Source: 10-Q Item 2 MD&A, p.21
The company has arranged up to $1,500.0 million in senior unsecured bridge term loans from Goldman Sachs Bank USA to help fund the cash portion of the Qorvo acquisition, and would assume or exchange Qorvo's outstanding senior notes upon closing, potentially increasing indebtedness and interest expense.
Source: 10-Q Item 2 MD&A, p.19-20,24
Gross margin declined to 40.1% from 41.6% due to unfavorable product mix, while operating expenses rose to 34.9% of revenue from 30.1%, driven by higher R&D, SG&A tied to transaction costs, and restructuring charges, compressing operating margin to 5.2% from 11.5%.
Source: 10-Q Item 2 MD&A, p.18,21-22
Restructuring, impairment, and other charges increased over 1,220% to $19.8 million for the quarter, primarily due to facility consolidation and closure costs, signaling ongoing operational realignment.
Source: 10-Q Item 2 MD&A, p.22
This analysis does not extract a guidance section. Companies issue revenue and EPS outlook in the 8-K press release and on the earnings call rather than in the 10-Q itself — though the filing's management discussion can contain forward-looking statements, which appear in the highlights above where they were material.
The filing does not disclose analyst estimates or consensus comparisons. What is disclosed is that net revenue of $934.8 million declined 3.1% year-over-year and net income margin fell to 3.6% from 10.9%, reflecting a weaker quarter driven by customer market share loss and elevated merger-related costs.
As of the July 3, 2026 quarter end, the $22.0 billion cash-and-stock merger with Qorvo remains pending, with both companies having certified substantial compliance with the FTC's Second Request issued February 5, 2026. Stockholders of both companies approved the deal at special meetings held February 11, 2026, and management stated they are 'increasingly hopeful' the deal will close within the calendar year.
Gross margin fell to 40.1% from 41.6% a year earlier, with gross profit down 6.5% to $375.0 million. Management attributed this primarily to unfavorable product mix, partially offset by higher unit volumes.
Skyworks held $813.8 million in cash, cash equivalents, and marketable securities as of July 3, 2026, down $574.6 million from October 3, 2025. The decline reflects $500.0 million in debt repayment, $106.9 million in dividends, and $87.1 million in capital expenditures, partially offset by $70.4 million of operating cash flow generated in the quarter.
Key risks include regulatory uncertainty around closing the Qorvo merger (subject to FTC review and potential termination fees up to $298.7 million), continued reliance on a significant customer whose market share loss drove the revenue decline, and rising leverage from up to $1,500.0 million in bridge financing arranged to fund the deal's cash consideration.
SWKS reported a challenging Q2 FY2026 with declines in revenue, operating income, and net income, highlighting increased R&D and SG&A expenses impacting profitability.
SWKS reported Q1 FY2026 revenue of $1.04B (down 3.1% YoY), with net income falling 51.1% to $79.2M as surging R&D and SG&A expenses sharply compressed operating and net margins despite stable gross margins and solid operating cash flow of $395.5M.
Other companies in Semiconductors