Skyworks Solutions, Inc.

Good afternoon and welcome to Skyworks Solutions second quarter fiscal year 2020 earnings call. This call is being recorded. At this time, I will turn the call over to Mitch Hawes, investor relations for Skyworks. Mr. Hawes, please go ahead.

Thank you, Cheryl. Good afternoon, everyone, and welcome to the Skyworks second fiscal quarter 2020 conference call. With me on the call today are Liam Griffin, our president and chief executive officer, and Chris Senesal, our Chief Financial Officer. Before we begin, I would like to remind everyone that our discussion will include statements relating to future results and expectations that are or may be considered forward-looking statements. Please refer to our earnings pressure lease and recent SEC filings, including our annual report on Form 10-K, for information on certain risks that could cause actual outcomes to differ materially and adversely from any forward-looking statements made today. Additionally, the results and guidance we will discuss include non-GAAP financial measures consistent with past practice. Please refer to our press release within the investor relations section of our company website for a complete reconciliation to GAAP. With that, I'll turn the call to Liam.

Thanks, Mitch, and welcome, everyone. Before we begin the overview of the business and our Q2 results, I wanted to provide an update on the COVID-19 outbreak. impacting individuals, companies, governments, and markets across the globe. Our thoughts are with the millions who have suffered the effects of this global pandemic. At Skyworks, we are deeply engaged with our own employees, a team of more than 9,000 deployed across the globe. Since the crisis began, we have taken early and aggressive actions to protect our people. We've implemented multiple safety protocols, including social distancing, daily temperature testing, and heightened sanitation standards. In addition, we initiated rotating shifts at our global manufacturing sites. The implementation of these protective measures has collectively allowed Skyworks to better safeguard employee health while simultaneously supporting our business and manufacturing sites worldwide. Finally, an update on the temporary suspension of activity in our Mexicali facility. After working in close collaboration with state and local officials in Mexico, we were given permission to resume operations last week. Assuming no further interruptions, we do not expect the temporary suspension to have a significant impact on our business going forward. Now, looking at the second quarter in more detail, we reported revenue of $766 million in line with our revised guidance. We produced gross margin of 50.2%, an operating margin of 32.5%. We posted earnings per share of $1.34, and we generated strong operating cash flow, totaling $280 million in the quarter. Further, our design wind momentum reflects our execution across a rapidly evolving business environment, one in which our wireless technologies are playing an essential and critical role, We are enabling markets from telemedicine to emergency response, remote work, online education, real-time security, streaming entertainment, and safe store-to-door food delivery. Our mission of connecting everyone and everything all the time has never been more relevant. During this time of social distancing and decreased travel, the technology Skyworks provides have become a primary means of connecting people all over the world. The rollout and adoption of 5G and other advanced wireless technologies, such as Wi-Fi 6 and enhanced GPS, have become the pillars in support of the vast connected economy. Skyworks is proud to play an integral role in making these vital technologies and essential connections a reality. During the March quarter, we expanded our engagement with leading customers, securing key design wins across numerous applications, from the mobile phone to wireless infrastructure, IoT, automotive, machine-to-machine, and medical applications. In mobile, we are leveraging our Sky5 platform across multiple flagship 5G launches, including Samsung, Oppo, Vivo, Xiaomi, and other Tier 1 players. and expanding our technology reach across our customized diversity receive platforms with new 5G-centric solutions driving sharp gains in design wind count. In IoT, we are supporting high-performance 5G and Wi-Fi-enabled tablets specifically developed for health, safety, and telemedicine applications. Across mobile operators, we are powering 5G hotspots with Verizon and AT&T devices supporting the expanding work-from-home trend. We're extending our market leadership in Wi-Fi 6 with home and enterprise gateways at Cisco. We're enabling home security applications at Honeywell and ramping remote patient monitoring systems with GE. We're also launching asset tracking and fleet management solutions with Juniper and BlackBerry. Moving to the infrastructure space, we're supporting... 5G massive MIMO and small cell base station deployments across the U.S., Europe, and Japan, and an automotive or accelerating connectivity content with leading brands including Volkswagen, Renault, Hyundai, and Nissan. These highlights demonstrate our technology leadership underpinned by a diverse and growing set of critical product categories, resolving increasingly complex architectures, and preparing our customers for the performance gains demanded in 5G. In these unprecedented times, our existing technologies and connectivity protocols are processing extraordinarily high data traffic. This explosion in data consumption is taxing networks with real-time video, high-speed processing, streaming content, and a long list of critical services. all dependent upon seamless, reliable, and ubiquitous connectivity. To illustrate how the pressure on the network capacity is intensifying, just over the last few months, we've seen visits to Amazon website rise more than 30% year over year, Zoom video conferencing passing a milestone of 300 million daily participants, Microsoft Teams platform logging a single-day record of 2.7 billion minutes. And now, with 5G just beginning to launch, the average user today is still working with legacy technologies, showing system weakness in this high data demand environment. Clearly, more than ever, always-on connectivity is paramount. Skyworks and our partners in the mobile and wireless ecosystems are anticipating and accelerating the development and delivery of much-needed cutting-edge technologies led by 5G, Wi-Fi 6, enhanced GPS, and other networking protocols. As Skyworks and the world navigate this challenging environment, our focus will continue to ensure streamlined, high-speed connectivity, delivering a path for reliable, constant and safe communication, reaching all of our customers and their varied applications. With that, I will turn the call over to Chris for discussion of Q2 and our outlook for Q3.