Skyworks Exits Baseband

Skyworks Solutions announced that the company is ceasing its baseband operations

October 2, 2006

1 Min Read

WOBURN, Mass. -- Skyworks Solutions, Inc. (NASDAQ:SWKS), an innovator of high performance analog and mixed signal semiconductors enabling mobile connectivity, today announced that effective immediately the company is ceasing its baseband operations in order to sharpen focus on its high growth core business encompassing linear products, power amplifiers, front-end modules and radio solutions. Skyworks’ baseband business developed complete reference designs, incorporating the digital signal processor and software functionality, in support of tier-three handset suppliers. This initiative was complex, research and development intensive and generated substantial operating losses. As tier-one OEMs have increasingly dominated the landscape, the addressable market for the company’s baseband solutions has significantly contracted.

At the same time, and essentially masked by declining baseband sales, Skyworks’ core business revenue has grown an average of 17 percent annually over the past four years. This growth has been driven by: first, the successful launch of the Linear Products business; second, power amplifier market share gains; third, ramp of Helios™ EDGE radios; and fourth, capture of increasing dollar content through highly integrated solutions.

Given the diverging profitability and growth profiles of the baseband and core businesses, the company has implemented a strategic restructuring to immediately eliminate all baseband-related infrastructure while strengthening research and development, marketing and sales efforts within the core business.

“Today marks a new beginning for Skyworks as we become a far more profitable and streamlined company. We are focusing exclusively on our high growth and profitable analog and RF core business where Skyworks possesses a clear competitive advantage,” said David J. Aldrich, Skyworks’ president and chief executive officer. “Going forward, we will partner with, rather than compete against, leading baseband suppliers such as Texas Instruments, Qualcomm, Freescale and Infineon.

Skyworks Solutions Inc. (Nasdaq: SWKS)

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