Starboard Value believes Skyworks Solutions (SWKS.US) has significant upside potential, provided it can achieve its merger goals with Qorvo, because their product portfolios are complementary and the company is still undervalued, according to people familiar with the matter.
Previously, Starboard Value obtained a stake in Skyworks through its acquisition of Qorvo. According to sources who requested anonymity because the details have not been made public, Starboard believes Skyworks remains undervalued after completing its acquisition of Qorvo this month. These people said Starboard, which had supported the deal when it held an activist stake in Qorvo, now believes the two companies' product portfolios are complementary and that Skyworks has excellent growth opportunities.
Starboard views this as a highly compelling deal, which includes a target of achieving $500 million or more in annual cost savings within three years, according to the sources. The activist investment firm believes the market has not recognized either this potential cost savings or management's forecast of achieving an operating margin of 30% to 35% within two to three years.
Starboard Value CEO Smith is expected to discuss this latest investment at the 13D Monitor Active-Passive Investor Summit in New York on October 20, where he is the keynote speaker.
Skyworks agreed last year to acquire Qorvo, in a deal that valued the combined company at approximately $22 billion. Previously, both companies were dealing with slowing growth after Apple decided to replace third-party chips with its own components. Both Skyworks and Qorvo produce tiny electronic chips used for smartphone communications, as well as for non-mobile businesses such as data centers and fighter jets.
Skyworks rose 0.8% in U.S. trading last Friday to close at $79.70, giving the company a market value of approximately $18.7 billion. The stock has gained about 4.7% over the past year.
Starboard took a stake in Qorvo in 2025 to push for operational improvements. Qorvo agreed to add Starboard managing member and head of research Peter Feld to its board, thereby avoiding a proxy fight. Two executives who joined Qorvo's board with Starboard's help are now still on Skyworks' board: Marvell Technology President Chris Koopmans and former NXP Semiconductors CEO Rick Clemmer.
Starboard has targeted some of the world's largest companies. According to data, the firm has recently established a new position in Shake Shack Inc. while remaining active in Dynatrace Inc., CarMax Inc. and Lamb Weston Holdings Inc.
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