Skyworks Solutions, Inc.

Good afternoon and welcome to Skyworks Solutions' third 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, Rob. Good afternoon, everyone, and welcome to Skyworks' third fiscal quarter 2020 conference call. With me 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 related to future results and expectations that are or may be considered forward-looking statements. Please refer to our earnings press release and recent SEC filings, including our end 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 includes certain non-GAAP financial measures consistent with our 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 discuss our Q3 results, I want to briefly comment on the COVID-19 pandemic, which continues to impact families, businesses, and markets worldwide. I'd like to start by recognizing the tireless efforts of our talented Skyworks team as we've rapidly adapted and responded to a new working environment. We've implemented rigorous protocols designed to protect the health and safety of our employees, along with our valued customers and trusted partners. In parallel, we continue to deliver the vital connectivity solutions that people worldwide are depending upon to navigate the pandemic. Now we'll turn to an overview of our third quarter performance. Skyworks delivered results well above consensus in the June quarter, as our Sky5 platform gains traction, powering innovation in 5G applications at the leading smartphone OEMs and increasingly across our IoT customers. For the third quarter, we reported revenue of $737 million, nearly $50 million above our guidance. we achieved gross margin of 50.1% and operating margin of 31.3%. We posted earnings per share of $1.25, beating our guidance by 12 cents, and we generated strong operating cash flow, totaling $259 million in the quarter. Our momentum continues to improve, reflecting on our execution across a rapidly evolving business landscape. as well as the broadening adoption of 5G. A few data points highlight the growth of this critical technology. Globally, 5G subscriptions are continuing to grow with estimates approaching 3 billion over the next five years. 5G handset demand is accelerating across a diversified set of customers and geographies. In fact, in China, During the month of June, approximately 60% of all smartphones sold were 5G enabled. And a new 3GPP standard was also released, validating the extension of 5G technology into IoT, V2X, multimedia broadcast, and other services. Clearly, 5G, along with other advanced wireless technologies, such as Wi-Fi 6 and enhanced GPS, are spawning new usage cases and fortifying the backbone of an expanding connected economy. During the quarter, we secured key design wins across numerous applications, from the mobile phone to industrial IoT, automotive, cognitive audio, aerospace, and defense. Specifically in mobile, we are expanding our Sky5 platform across multiple flagship 5G models. at Samsung, Motorola, Oppo, Vivo, and Xiaomi. In addition, we are populating some of the highest performing 5G platforms that we'll be launching later this year. In IoT, we're enabling AT&T's tri-band gateways with our Wi-Fi 6 solutions, ramping indoor and outdoor access points at Aruba, Juniper, and Linksys. powering integrated connectivity in Amazon and Ring security systems, launching voice assistant solutions and mesh routers at Google, and we're leveraging our 4x4 MIMO and Wi-Fi engines and premium soundbars at Sonos. In addition, we delivered new cognitive wireless audio solutions, powering the leading gaming headsets. Now moving to the industrial space, We are supporting IoT platforms at Bosch and Gemalto and leveraging our GPS, circulator, and advanced filter solutions at leading aerospace and defense companies. And in automotive, we're capturing new designs with Sky5 at BMW, Ford, and other leading manufacturers. These wins demonstrate our market leadership, underpinned by a diverse and growing set of critical technologies, resolving increasingly complex architectures and preparing our customers for the performance gains demanded in 5G. During the pandemic, we have witnessed a sharp inflection in the usage case of our core technology, enabling a variety of work-from-home applications, online learning and education, media and gaming, at-home fitness, safe telemedicine, and a sustainable shift to touchless commerce. Given this increased demand for high-speed data consumption, networks are being taxed as never before. To illustrate how the pressure on the network is intensifying, on a typical day in just one second, there are 96,000 gigabytes of Internet traffic, 85,000 videos watched on YouTube, 84,000 Google searches, and 5,000 Skype calls. Now more than ever, always-on connectivity is paramount, creating a compelling market opportunity for Skyworks' proven solutions. Whether it's Zoom, Teams, FaceTime, telemedicine, or touchless home delivery, at Skyworks, our commitment is to make these connections seamless and efficient. Looking forward, we are not bounded by handset volumes. as our reach continues to expand across the IoT space, enabling a wide range of industries, applications, and customers, all benefiting from the performance and utility of our solutions. In short, our unique technologies have never been more valuable, essential, and critical, with an expanding opportunity set emerging in ways that we have never imagined. With that, I will turn the call over to Chris for a discussion of Q3 and our Q4 outlook.