The smartphone slowdown has dealt a massive blow to Skyworks Solutions (NASDAQ:SWKS). The chipmaker was forced to slash its guidance for the first quarter of fiscal 2019 a few weeks ago thanks to "unit weakness across our largest smartphone customers."

That's bad news for Skyworks, since the company was already struggling to boost its top and bottom lines, and the latest red flag means that things are about to get worse. The stock has already pulled back significantly from the 52-week highs seen almost a year ago, and it wouldn't be surprising to see more near-term weakness in light of the problems faced by Apple (NASDAQ:AAPL), its largest customer.

Let's see what's could be in store when Skyworks releases its fiscal first-quarter results on Feb. 5.

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The not-good news

According to Skyworks' latest guidance update, the company should report earnings between $1.81 and $1.84 per share on revenue of approximately $970 million. The numbers are well below the year-ago period's EPS of $2.00 and revenue of $1.05 billion, though the weakness is already priced into the stock, which had tanked big-time early in the year when Apple slashed its outlook.

The real test for Skyworks will be the guidance. Management has been working hard to diversify beyond Apple by getting into fast-growing and lucrative markets such as the Internet of Things (IoT). But that's unlikely to be of much help in the short run, because Apple supplies nearly half of the chipmaker's top line, and Cupertino is itself in a big spot of bother thanks to slowing iPhone sales.

Supply chain reports indicate that Apple's iPhone production will nosedive significantly in the first quarter of calendar 2019, which coincides with Skyworks' second fiscal quarter. The Nikkei Asian Review reports that Apple's iPhone builds could range between 40 million and 43 million units during the first quarter of 2019. For comparison, Cupertino shipped just over 52 million units in the prior-year period.

As such, there's a strong probability that Skyworks' outlook will be a muted one and could fall below Wall Street's expectations. That could set the cat among the pigeons and send the stock down. But savvy investors would do well to keep a close eye on Skyworks' progress beyond the smartphone market, since that could be the key to its turnaround.

Look beyond Apple

Skyworks has started getting a sizable portion of its revenue from nonmobile sources in recent quarters. The company classifies revenue from nonmobile sources, such as automotive and smart homes, under the broad markets segment, which produced 28% of its revenue in the fourth quarter of fiscal 2018.

This business has been clocking double-digit growth, and Skyworks expects to sustain the same in the long run. That shouldn't be very difficult for the company, as it has scored a clutch of design wins in the automotive industry for supplying connectivity and telematics solutions.

Such contract wins should allow Skyworks to take advantage of the automotive chip market that's expected to clock an annual growth rate of 10.7% through 2025, according to Grand View Research. On the other hand, Skyworks has already made its presence felt in the smart-home space, where the likes of Amazon, GE, Google, and Netgear are using the chipmaker's solutions to power connected homes.

The good news is that Skyworks' broad markets business hasn't shown any signs of a slowdown. More importantly, the fast-growing nature of the businesses in this segment means that it is unlikely to witness a slowdown anytime soon.

What should investors do?

However, the fact remains that Skyworks gets a major chunk of its revenue from Apple, and that isn't going to change in the near future. That's why the near-term weakness at Skyworks is going to prevail despite the growth in the broad markets business, though savvy investors can keep nibbling on the shares given the company's valuation and dividend.

Skyworks stock trades at less than 10 times forward earnings and carries a nice dividend yield of 2.20%. The company also has a solid balance sheet without any debt and has more than $1 billion in cash. Additionally, Skyworks investors shouldn't forget that the advent of fifth-generation (5G) wireless technology will give the company's smartphone business a shot in the arm.

Any weakness in Skyworks stock post-earnings could be a buying opportunity for investors with a long investing horizon, because its foray into markets beyond mobile and a potential smartphone turnaround will be catalysts in the long run.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon, Apple, Skyworks Solutions. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.