Apple’s stellar Q2 earnings are expected to positively impact its key suppliers, according to analysts at Stifel and KeyBanc. Companies like Cirrus Logic, Qorvo, Ceva, and Skyworks Solutions are poised to benefit from strong iPhone demand and upcoming product launches. While Apple’s stock rose, supplier stocks saw a slight dip on Friday.
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Apple's Strong Results Fuel Optimism for Key Suppliers: Here's Who Analysts Are Watching
Apple reported excellent fiscal second-quarter results on Thursday, boosting prospects for several technology stocks closely tied to the tech giant, according to analysts at Stifel and KeyBanc.
The firms highlighted semiconductor companies Cirrus Logic, Qorvo, and Ceva, as well as wireless networking services provider Skyworks Solutions, as likely beneficiaries of Apple's recent growth. Stifel attributes this potential upside to robust iPhone demand, particularly for Pro models, which utilize more content from these suppliers.
Analyst Insights:
- Stifel's Tore Svanberg: "CRUS sees incremental upside from overall iPhone strength given its > 90% revenue exposure, with more content in Pros. Strong iPhone demand and modem shifts benefit SITM and CEVA, while iPhone demand supports revenue targets for SWKS and QRVO despite looming socket loss threats."
- iPhone Sales: Apple recorded $57 billion in iPhone sales during the quarter, slightly below the $57.2 billion expected by LSEG analysts due to supply chain constraints.
- Future Outlook: Stifel anticipates improved smartphone sales in the June quarter as supply chain issues ease. KeyBanc projects 58.3 million iPhone sales in the fiscal third quarter, translating to $55.5 billion in revenue – a 20% year-over-year increase.
- iPhone 18 Pro/Max: The anticipated release of the iPhone 18 Pro and Pro Max later this year is expected to further drive smartphone sales.
Despite Apple's stock rising over 4% on Friday, shares of the aforementioned suppliers experienced declines: Cirrus and Ceva fell by over 1%, while Qorvo and Skyworks each dropped approximately 3%.
