Apple (NASDAQ:AAPL) chip supplier Skyworks Solutions (NASDAQ:SWKS) announced on Wednesday that it was slashing its revenue and earnings forecast for the current fiscal quarter due to falling demand brought on by the COVID-19 outbreak. The company noted that while there had been "no significant disruption within Skyworks' manufacturing operations to date, the current demand environment for our products has been negatively impacted by interruptions in global supply chains."
The semiconductor company is now guiding for fiscal second-quarter revenue in a range of $760 million to $770 million, which would represent a year-over-year decline of between 5% and 6%. This compares to its previous forecast of revenue in a range of $800 million and $820 million, between a decline of 1% and a gain of 1% versus the year-ago quarter.
The bottom line is also expected to take a hit. Skyworks now expects non-GAAP diluted earnings per share (EPS) of $1.34 at the midpoint of its revenue guidance, a decline of 9% compared to the prior-year quarter. The company's previous forecast called for growth of about 1%.
In mid-February, Apple cut its own guidance for Q2 because of the crisis. The tech giant said the global supply of iPhones was "temporarily constrained" due to a slowdown in manufacturing, while also citing weak demand in China, its second-largest market.
This no doubt contributed to Skyworks' decision to lower its forecast, as sales of radio chips to Apple represented about 51% of Skyworks' net revenue last year. It also derives 20% of its sales from China, the area hardest hit by the epidemic.