Skyworks Solutions' (NASDAQ:SWKS) stock has risen roughly 650% over the past decade as demand for its wireless chips climbed across the mobile, automotive, home automation, wireless infrastructure, and industrial markets. But can this chipmaker continue generating multi-bagger gains over the next 10 years?

Let's examine its long-term priorities to find out.

Reducing its dependence on Apple

Skyworks provides power amplifier modules (PAM), diversity receive (DRx) modules, and other chips for Apple's (NASDAQ:AAPL) iPhones. It generated 51% of its revenue from the tech giant last year.

The numbers "2020" next to a ladder leading upwards to "2030".

Image source: Getty Images.

Skyworks' overwhelming dependence on Apple is a double-edged sword: It's benefited from rising iPhone sales over the past decade, but it's suffered whenever iPhone sales have stagnated.

Skyworks already serves other major customers like Xiaomi, Amazon, and Cisco, but it must continue diversifying its customer base to offset the inevitable slowdown in iPhone sales, which are facing tougher competition and longer upgrade cycles.

Profiting from the growth of the 5G market

Skyworks expects the incoming wave of 5G upgrades to strengthen its business in two ways.

First, it expects significant content share gains, with front-end chip revenue hitting $25 per 5G smartphone -- up from $18 per 4G device, $8 per 3G device, and $3 per 2G device. Second, it will diversify its customer base away from smartphones as other devices -- including smart homes, smart factories, connected cars, and wearables -- link to 5G networks.

Those tailwinds will likely strengthen Skyworks' business and pave the way for the arrival of 6G networks in the second half of the decade.

Opportunities for growth in the auto and infrastructure markets

The automotive and wireless infrastructure markets have been sluggish, mainly due to macro headwinds, but Skyworks expects to generate more revenue from both markets over the long term.

Driverless cars on a freeway.

Image source: Getty Images.

Skyworks, citing a BAML U.S. Semiconductors study, expects 73% of cars to ship with cellular connectivity by 2024. It also expects each autonomous vehicle to contain $50 in RF (radio frequency) chips, which could reduce its dependence on Apple and other smartphone makers.

In the infrastructure market, Skyworks expects carriers to increase the density of their networks with its massive MIMO (multiple input, multiple output) chips, small cells, and indoor radios.

In short, Skyworks will likely benefit from the surging bandwidth needs of the wireless, data center, and cloud markets over the next few years -- which will complement the growth of the broader IoT (Internet of Things) across multiple industries.

Sticking with dividends and buybacks

Skyworks started paying a dividend in 2016, and it subsequently raised its payout every year. It spent just 31% of its free cash flow on its dividend over the past 12 months, and it currently pays a forward yield of 1.4%.

Over the long term, Skyworks plans to return 65%-70% of its free cash flow to shareholders via dividends and buybacks. Its free cash flow margin, which rose from 21% in 2013 to 29% in 2019, could also continue expanding over the next decade as it diversifies its customer base, scales up its business, and enters new markets.

Looking beyond the near-term headwinds

Last year, Skyworks' revenue and adjusted earnings tumbled 13% and 15%, respectively, as sluggish smartphone sales, including its loss of orders from the besieged Chinese tech giant Huawei, couldn't offset its stronger sales of IoT and analog chips.

Those disappointing declines ended Skyworks' multi-year streak of positive revenue and earnings growth. Analysts expect that pain to continue with a 7% decline in sales and a 9% drop in earnings this year.

But over the next five years, analysts expect Skyworks' earnings to rise at an average rate of 11% annually. Investors should take that long-term forecast with a grain of salt, but it suggests Skyworks' slowdown is temporary -- and the aforementioned catalysts could spark a fresh growth cycle over the next 10 years.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.