Shares of semiconductor manufacturer Skyworks Solutions Inc. (SWKS) traded almost flat over the course of 2016, up an approximate 1.9% year over year (YOY) at a closing price of $74.66 on Dec. 30.

The Woburn, Mass.-based supplier of analog and mixed-signal semiconductors has recently focused on expanding its product portfolio beyond large customers including smartphone makers Apple Inc. (AAPL) and Samsung Electronics. The firm remained bullish throughout 2016 on its ability to “capitalize on the strength of both Mobile and Internet of Things (IoT) ecosystems.”

iPhone Strength Lifts Stock

Skyworks recovered an approximate 27% in the most-recent six-month period, in large part due to strength of Apple’s new iPhone 7, along with investor confidence regarding the firm’s consecutive quarterly earnings beats.

The U.S. chipmaker attributed better-than-expected earnings in part due to an upward demand in China, as the firm’s chips are used in increasingly complex smartphones. In the third quarter, Skyworks announced an expanded partnership with Chinese smartphone market Xiaomi, alongside new contracts with Subaru and Home Depot (HD).

In the firm’s most recent fourth-quarter earnings, investors applauded 5.2% YOY sales growth to $835.4 million for the period, compared to a disappointing 7.2% YOY decline reported in the third quarter. (See also: Skyworks’ Q4 Earnings Beats Expectations.)

Targeting IoT for 2017

Moving ahead, Skyworks, at the head of the overall semiconductor market, indicates it is positioned to gain from “the rising adoption of streaming media services, the proliferation of connectivity in emerging markets, and the Internet of Things.”

Skyworks’ guidance for the first quarter of 2017 beat analysts’ expectations, indicating a 7% to 9% sequential revenue increase. In early November, rumors indicated Skyworks may also target IoT player Microsemi for a purchase with a price estimated to reach $10 billion.

Despite diversification efforts, Skyworks will undoubtedly see its financials fluctuate in 2017, linked to the performance of Apple, which accounts for an approximate 40% of the firm’s total sales. (See also: Analyst: Lower Skyworks Estimate from iPhone.)

 

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