Liam Griffin's departure as CEO of Skyworks Solutions Inc. set off a significant chain reaction in the stock market on Thursday. The news that the chipmaker lost its exclusive Apple business sent Skyworks shares into a tailspin, dropping over 25% in value. This development prompted analysts to slash their price targets for Skyworks, further contributing to the stock's 3% decline by the end of the trading day.
Skyworks, known for manufacturing chips used in wireless devices, faced a major setback with the loss of its sole source Apple business. Industry insiders believe that Broadcom has now taken over this lucrative segment, disrupting Skyworks' standing in the market. The shift had analysts predicting that while Broadcom may now share the Apple business with Skyworks, the initial impact would be starkly negative for the latter.
The market's reaction to Skyworks' upheaval was palpable, with shares plunging significantly. The news emerged as a major market mover, impacting investor sentiment and altering the landscape for tech stocks. Despite this turbulence, the major indices—Dow Jones, S&P 500, and Nasdaq—managed to post back-to-back gains. This performance came amid anticipation of Amazon's quarterly earnings report, which was scheduled for release on Thursday evening, and ahead of a major government jobs report expected Friday morning.
Skyworks' situation underscores the volatility of the tech sector, where the loss of a single contract can have outsized consequences. With Griffin's exit and the subsequent stock market reaction, Skyworks faces a pivotal moment in its business trajectory. As analysts continue to reassess their outlook on Skyworks, the company's next steps will be closely scrutinized by investors and industry watchers alike.