Skyworks Solutions (SWKS) 10-K risk factor changes: FY2019 vs FY2018

Additional risks not currently known to us or other factors not perceived by us to present significant risks to our business at this time may impair our business operations, financial [removed: condition] [added: condition,] or results of operations.

[removed: We] [added: We] operate in the highly cyclical semiconductor industry, which is subject to significant [removed: downturns.][added: downturns.]

Furthermore, downturns in the semiconductor industry may be prolonged, and any extended delay or failure of the market to recover from an economic downturn would materially and adversely affect our business, financial [removed: condition] [added: condition,] and results of operations beyond our current fiscal year.

[removed: Our] [added: Our] operating results may be adversely affected by quarterly and annual fluctuations and market [removed: downturns.][added: downturns.]

Our revenues, [removed: earnings] [added: earnings,] and other operating results may fluctuate significantly on a quarterly and annual basis.

| • | market acceptance of our products and our customer’s [removed: products,] [added: products (including, but not limited to, market acceptance of 5G products),] and |

Changes to such methods, assumptions, estimates, and judgments, combined with other factors that are difficult to forecast, including the factors listed above, could materially and adversely affect our quarterly or annual operating results and could produce actual operating results that differ significantly from [removed: previous estimates and projections.]

[removed: Our] [added: Our] reliance on a small number of customers for a large portion of our [removed: sales could] [added: sales could] have a material adverse effect on the results of our [removed: operations.][added: operations.]

In [added: each of] fiscal [added: 2019 and fiscal] 2018, one customer accounted for greater than ten percent of our net revenue.

For further discussion see [Note [removed: 17](#s5EF058DE6E2A69852D96B460308E491E)] [added: 15](#sD38EFE386C575F159B540359D917F6FF)] to Item 8 of this Annual Report on Form 10-K.

[removed: Our] [added: Our] stock price has been volatile and may fluctuate in the [removed: future.][added: future.]

| • | changes in earnings estimates, price [removed: targets] [added: targets,] or buy/sell recommendations by analysts, |

| • | our ability to successfully identify, [removed: acquire] [added: acquire,] and integrate acquisition candidates. |

In addition, fluctuations in our stock price, volume of shares traded, and changes in our trading multiples may make our stock attractive to momentum, [removed: hedge] [added: hedge, day-trading,] or [removed: day-trading] [added: activist] investors who often shift funds into and out of stocks rapidly, exacerbating price fluctuations in either direction.

If our operating results do not meet the expectations of securities analysts, the financial news [removed: media] [added: media,] or investors, our stock price may decline, possibly substantially over a short period of time.

[removed: The] [added: The] wireless communications and analog semiconductor markets are characterized by significant competition which may cause pricing pressures, decreased gross margins and rapid loss of market share and may materially and adversely affect our business, financial [removed: condition] [added: condition,] and results of [removed: operations.][added: operations.]

We compete with international and United States semiconductor manufacturers of all sizes in terms of resources and market share, including, but not limited to, Analog Devices, Broadcom, [added: Cirrus Logic,] Maxim Integrated Products, Murata Manufacturing, NXP Semiconductors, [removed: QUALCOMM,] [added: Qorvo,] and [removed: Qorvo.][added: Qualcomm.]

This competition has resulted in, and is expected to continue to result in, declining average selling prices for [added: many of] our products and increased challenges in maintaining or increasing revenue, gross [removed: margin] [added: margin,] and market share.

| • | rapid time-to-market and product [removed: ramps,] [added: ramps (including, but not limited to, high-volume product ramps),] |

| • | product quality, [removed: reliability] [added: reliability,] and performance, |

| • | maintaining access to manufacturing capacity, raw materials, [removed: supplies] [added: supplies,] and services at a competitive cost. |

| • | strong financial, sales and marketing, manufacturing, distribution, [removed: technical] [added: technical,] or other resources. |

As a result, certain competitors may be able to adapt more quickly than we can to new or emerging technologies and changes in customer requirements or may be able to devote greater resources to the development, [removed: promotion] [added: promotion,] and sale of their products than we can.

If such a product offering were competitive with our solution as to performance, [removed: price] [added: price,] and quality, [added: or if the interoperability of] our [added: solution with the partner’s baseband products were to be restricted, our] business could be adversely impacted.

Current and potential competitors have established, or may in the future establish, [removed: financial] [added: financial,] or strategic relationships among themselves or with customers, [removed: resellers] [added: resellers,] or other third parties.

Increased competition could result in pricing pressures, decreased gross margins and loss of revenue and market share and may materially and adversely affect our business, financial [removed: condition] [added: condition,] and results of operations.

[removed: If] [added: If] Original Equipment Manufacturers, or OEMs, and Original Design Manufacturers, or ODMs, of communications electronics products do not design our products into their equipment, we will have difficulty selling those products.

Moreover, a “design win” from a customer does not guarantee future sales to that [removed: customer.][added: customer.]

If a manufacturer designs another supplier’s product into one of its product platforms, it is more difficult for us to achieve future design wins with that platform because changing suppliers involves significant cost, time, [removed: effort] [added: effort,] and risk on the part of that manufacturer.

Furthermore, as a result of our lengthy product development and sales cycle, we may incur significant research and development expenses, and selling, [removed: general] [added: general,] and administrative expenses, without generating the anticipated revenue associated with these products.

[removed: We] [added: We] are subject to the risks of doing business [removed: internationally.][added: internationally.]

[removed: In addition, we] [added: We] have suppliers located outside the United States, and third-party packaging, [removed: assembly] [added: assembly,] and test facilities and foundries located in the Asia-Pacific region.

[removed: Finally, we] [added: We] maintain wafer fabrication facilities in Kadoma, Japan, and Osaka, Japan, as well as packaging, [removed: assembly] [added: assembly,] and test facilities in Mexicali, Mexico, and in Singapore.

[removed: Our international] sales and operations are subject to a number of risks inherent in selling and operating abroad.

| • | local economic and political conditions, including, but not limited to, social, [removed: economic] [added: economic,] and political instability related to the uncertainty regarding the relationships between the United States and China, Russia, Mexico, North Korea, Middle Eastern countries, other foreign countries, and the international community at large, and related to the United Kingdom’s pending withdrawal from the European Union, |

| • | restrictive governmental actions (such as restrictions on transfer of funds and trade protection measures, including export duties, quotas, customs duties, border taxes, [added: border closures,] increased import or export [removed: controls] [added: controls,] and [removed: tariffs)] [added: tariffs), or actions by non-governmental individuals and groups (such as protests, insurgencies, and organized crime),] that could negatively impact trade between, or increase the cost of operating in, the countries in which we do business, |

| • | natural disasters, acts of terrorism, widespread [removed: illness] [added: illness,] and war, |

| • | [added: misappropriation or other] unauthorized transfers of our electronic information and breaches of our information systems, as well as the potential lack of adequate remedies in certain jurisdictions, |

| • | the possibility of being exposed to legal proceedings and potential penalties in a foreign jurisdiction, and/or increased compliance expense, as a result of the numerous, and sometimes conflicting, legal regimes on matters as diverse as anti-corruption, anti-bribery, import/export controls, content requirements, trade restrictions, tariffs, taxation, sanctions, immigration, internal and disclosure control obligations, securities regulation, anti-competition, data privacy and protection (including, but not limited to, the European Union’s General Data Protection Regulation), [removed: employment] [added: employment,] and labor relations, |

Some of the countries in which we operate and seek to expand are in emerging markets where legal systems may be less developed or familiar to [removed: us.][added: us, potentially impacting our ability to obtain appropriate recourse in the event of a dispute.]

| • | delays in the adoption of standards by standard-setting bodies and delays in the commercial deployment of certain technologies (including, but not limited to, 5G), |

| • | actions by government regulators to restrict or delay the availability of sufficient spectrum for wireless technologies, including technologies that utilize unlicensed spectrum and/or shared spectrum, |

| • | changes in consumers’ rates of replacement of smartphones and other devices that utilize our products, |

previous estimates and projections.

| • | ability to capture design wins in new growth markets, such as 5G, |

| • | ability of certain products, including “high reliability” solutions, to perform under stringent operating conditions, |

Our international

For example, in May 2019, the U.S. Bureau of Industry and Security of the U.S. Department of Commerce placed Huawei and certain of its affiliates on the Bureau’s Entity List, which resulted in our temporarily suspending shipments to Huawei, and which is expected to adversely affect future demand for our products from this customer.

Our key facilities include, but are not limited to, our semiconductor wafer fabrication facilities in Newbury Park, California, and Woburn, Massachusetts, our SAW, TC-SAW, and BAW filter wafer fabrication facilities in Kadoma, Japan, and Osaka, Japan, and our assembly and test facilities in Mexicali, Mexico, and in Singapore.

Certain of our products, including “high reliability” solutions, may not be able to perform under stringent operating conditions.

Examples of our “high reliability” solutions include applications intended for the aerospace, automotive, medical, and military markets.

from our third-party suppliers.

Our employees are highly sought after by our competitors and other companies.

third-party intellectual property.

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In fiscal 2016, two customers each accounted for ten percent or greater of our net revenue.

We expect to continue to expand our business and operations in China.

Our success in the Chinese markets may be adversely affected by China’s continuously evolving laws and regulations, including

Our SAW and TC-SAW filter manufacturing process is also specialized in nature and in the event of a disruption in production at our filter wafer fabrication facilities in Kadoma, Japan and Osaka, Japan or in our filter assembly and test facility in Singapore, for any reason, alternative filter production capacity would not be immediately available from third-party sources.

These disruptions could have a material adverse effect on our business, financial condition and results of operations.

indemnification claims, or other obligations under customer contracts.

For example, our subsidiary in Singapore receives a tax holiday that is expected to be effective through September 2020.

Changes in the status of this tax holiday could have a negative effect on our net income in future years.

In addition, new restrictions on emissions of carbon dioxide or other greenhouse gases could result in significant costs for us.

The Commonwealth of Massachusetts has adopted greenhouse gas regulations, and the United States Congress may pass federal greenhouse gas legislation in the future.

The United States Environmental Protection Agency has issued greenhouse gas reporting regulations that may apply to certain of our operations.

[removed: The] [added: *The] following discussion and analysis of our financial condition and results [removed: of operations] [added: of* *operations] should be read in conjunction with our consolidated [removed: financial statements] [added: financial* *statements] and related notes that appear elsewhere in this Annual Report [removed: on Form] [added: on* *Form] 10-K.

In addition to historical information, the following [removed: discussion contains] [added: discussion* *contains] forward-looking statements that are subject to risks [removed: and uncertainties.][added: and* *uncertainties.]

Actual results may differ substantially and adversely from [removed: those referred] [added: those* *referred] to herein due to a number of factors, including, but not limited [removed: to, those] [added: to,* *those] described below and in Item 1A [removed: “[Risk Factors](#s4EC3EB606B155BD10E96B4603E6D4828)”] [added: “*[*Risk Factors*](#sF8930A0C1A5A591F80290F080BCCDA40)*”] and elsewhere in this Annual Report on Form [removed: 10-K.][added: 10-K.*]

[removed: OVERVIEW][added: OVERVIEW]

Our key customers include Amazon, Apple, Arris, Bose, Cisco, DJI, Ericsson, Foxconn, Garmin, [removed: Gemalto,] [added: Gemalto (a Thales company),] General Electric, Google, Honeywell, HTC, Huawei, Itron, Lenovo, LG Electronics, Microsoft, Motorola, Netgear, Northrop Grumman, OPPO, Rockwell Collins, Samsung, Sierra Wireless, Sonos, Technicolor, VIVO, Xiaomi and ZTE.

[removed: RESULTS] [added: RESULTS] OF [removed: OPERATIONS][added: OPERATIONS]

[removed: FISCAL] [added: FISCAL] YEARS [removed: ENDED SEPTEMBER] [added: ENDED SEPTEMBER 27, 2019, SEPTEMBER] 28, [removed: 2018, SEPTEMBER] [added: 2018, AND SEPTEMBER] 29, [removed: 2017, AND SEPTEMBER 30, 2016.][added: 2017.]

The [removed: following] table [added: below] sets forth the results of our operations expressed as a percentage of net [removed: revenue:][added: revenue.]

| | [removed: September 28, 2018] [added: September 27, 2019] | | | [removed: September 29, 2017] [added: September 28, 2018] | | | [removed: September 30, 2016] [added: September 29, 2017] | |

| Cost of goods sold | [removed: 49.6] [added: 52.5] | | | 49.6 | | | [removed: 49.4] [added: 49.6] | |

| Gross profit | [removed: 50.4] [added: 47.5] | | | 50.4 | | | [removed: 50.6] [added: 50.4] | |

| Research and development | [removed: 10.4] [added: 12.5] | | | [removed: 9.7] [added: 10.4] | | | [removed: 9.5] [added: 9.7] | |

| Selling, general and administrative | [removed: 5.4] [added: 5.9] | | | [removed: 5.6] [added: 5.4] | | | [removed: 6.0] [added: 5.6] | |

| Amortization of intangibles | [removed: 0.5] [added: 0.7] | | | [removed: 0.8] [added: 0.5] | | | [removed: 1.0] [added: 0.8] | |

[removed: | Restructuring and other charges | — | | | — | | | 0.1 | |][added: RESTRUCTURING AND OTHER CHARGES]

| Total operating expenses | [removed: 16.3] [added: 19.3] | | | [removed: 16.1] [added: 16.3] | | | [removed: 16.6] [added: 16.1] | |

| Operating income | [removed: 34.1] [added: 28.2] | | | [removed: 34.3] [added: 34.1] | | | [removed: 34.0] [added: 34.3] | |

| Other income (expense), net | 0.3 | | | [removed: 0.1] [added: 0.3] | | | [removed: (0.2] [added: 0.1] | [removed: )] |

| Income before income taxes | [removed: 34.4] [added: 28.5] | | | 34.4 | | | [removed: 36.5] [added: 34.4] | |

| Provision for income taxes | [removed: 10.7] [added: 3.2] | | | [removed: 6.7] [added: 10.7] | | | [removed: 6.2] [added: 6.7] | |

| Net income | [removed: 23.7] [added: 25.3] | % | | [removed: 27.7] [added: 23.7] | % | | [removed: 30.3] [added: 27.7] | % |

[removed: GENERAL][added: GENERAL]

During the fiscal year ended September [removed: 28, 2018,] [added: 27, 2019,] the following key factors contributed to our overall results of operations, financial position and cash flows:

| • | Net revenue [removed: increased] [added: decreased 12.7%] to [removed: approximately $3,868.0] [added: $3,376.8] million, [removed: an increase of 6%] as compared to [removed: the prior] fiscal [removed: year.] [added: 2018.] This [removed: increase] [added: decrease] in revenue was primarily driven by [added: weakness in smartphone demand and Huawei being added to the Entity List, partially offset by the increasing number of IoT applications,] our [added: expanding analog product portfolio supporting new vertical markets including automotive, consumer, industrial, infrastructure, medical, and military, and our] success in capturing a higher share of the increasing radio frequency and analog content per device as smartphone models continue to [removed: evolve, increases in applications for the IoT, and the expanding analog product portfolio supporting new vertical markets including aerospace, automotive, industrial, medical and military.] [added: evolve.] |

[removed: NET REVENUE][added: NET REVENUE]

| | [removed: Fiscal] [added: Fiscal] Years [removed: Ended] [added: Ended] | | | | | | | | | | |

| | [removed: September 28, 2018] [added: September 27, 2019] | | | [removed: Change] [added: Change] | [removed: September 29, 2017] [added: September 28, 2018] | | | [removed: Change] [added: Change] | [removed: September 30, 2016] [added: September 29, 2017] | | |

| Net revenue | $ | [removed: 3,868.0] [added: 3,376.8] | | [removed: 5.9%] [added: (12.7)%] | $ | [removed: 3,651.4] [added: 3,868.0] | | [removed: 11.0%] [added: 5.9%] | $ | [removed: 3,289.0] [added: 3,651.4] | |

We generally experience seasonal peaks during [added: our fourth and first fiscal quarters (which correspond to] the second half of the calendar [removed: year,] [added: year),] primarily as a result of increased worldwide production of consumer electronics in anticipation of increased holiday sales, whereas our second and third fiscal [removed: quarter is] [added: quarters are] typically lower and in line with seasonal industry trends.

The [removed: $216.6] [added: $491.2] million [removed: increase] [added: decrease] in [added: net] revenue in fiscal [removed: 2018] [added: 2019,] as compared to fiscal [removed: 2017 and the $362.4 million increase in revenue] [added: 2018, is primarily related to weakness] in [removed: fiscal 2017 as compared] [added: smartphone demand and Huawei being added] to [removed: fiscal 2016 were primarily driven] [added: the Entity List, partially offset] by [added: the increasing number of IoT applications,] our [added: expanding analog product portfolio supporting new vertical markets including automotive, consumer, industrial, infrastructure, medical, and military, and our] success in capturing a higher share of the increasing radio frequency and analog content per device as [removed: smartphones] [added: smartphone] models continue to [removed: evolve, the increasing number of applications for the IoT, and our expanding analog product portfolio supporting new vertical markets including automotive, industrial, medical and military.][added: evolve.]

For information regarding net revenue by geographic region and customer concentration, see [Note [removed: 17](#s5EF058DE6E2A69852D96B460308E491E)] [added: 15](#sD38EFE386C575F159B540359D917F6FF)] to Item 8 of this Annual Report on Form 10-K.

[removed: GROSS PROFIT][added: GROSS PROFIT]

| | [removed: Fiscal] [added: Fiscal] Years [removed: Ended] [added: Ended] | | | | | | | | | | |

| | [removed: September 28, 2018] [added: September 27, 2019] | | | [removed: Change] [added: Change] | [removed: September 29, 2017] [added: September 28, 2018] | | | [removed: Change] [added: Change] | [removed: September 30, 2016] [added: September 29, 2017] | | |

| Gross profit | $ | [removed: 1,950.7] [added: 1,603.8] | | [removed: 5.9%] [added: (17.8)%] | $ | [removed: 1,841.8] [added: 1,950.7] | | [removed: 10.6%] [added: 5.9%] | $ | [removed: 1,665.2] [added: 1,841.8] | |

| % of net revenue | [removed: 50.4] [added: 47.5] | | % | | 50.4 | | % | | [removed: 50.6] [added: 50.4] | | % |

[removed: Gross] [added: As a result of these impacts, gross] profit margin [removed: remained consistent at 50.4%] [added: decreased to 47.5%] of net revenue for fiscal [added: 2019 as compared to 50.4% in fiscal] 2018.

[removed: RESEARCH] [added: RESEARCH] AND [removed: DEVELOPMENT][added: DEVELOPMENT]

| | [removed: Fiscal] [added: Fiscal] Years [removed: Ended] [added: Ended] | | | | | | | | | | |

| | [removed: September 28, 2018] [added: September 27, 2019] | | | [removed: Change] [added: Change] | [removed: September 29, 2017] [added: September 28, 2018] | | | [removed: Change] [added: Change] | [removed: September 30, 2016] [added: September 29, 2017] | | |

See Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended September 28, 2018, filed with the SEC on November 15, 2018, as amended by Amendment No. 1 to such Annual Report on Form 10-K, filed with the SEC on January 25, 2019 (the “2018 10-K”), for Management’s Discussions and Analysis of Financial Condition and Results of Operations for the fiscal year ended September 29, 2017.

| • | Our ending cash, cash equivalents and marketable securities balance increased 3.1% to $1,082.2 million in fiscal 2019 from $1,050.2 million in fiscal 2018. This increase was primarily the result of a 8.5% increase in cash from operations to $1,367.4 million in fiscal 2019 from $1,260.6 million in fiscal 2018, partially offset by the repurchase of 8.9 million shares of our common stock for $657.6 million, capital expenditures of $398.4 million, and cash dividends of $273.9 million. |

The $346.9 million decrease in gross profit in fiscal 2019, as compared to fiscal 2018, was primarily the result of lower unit volumes and lower average selling prices with a gross profit impact of $546.5 million.

In addition, we incurred a $66.1 million inventory-related charge due to lower expected demand as a result of Huawei being added to the Entity List.

These negative impacts were partially offset by favorable product mix that positively impacted gross profit by $265.7 million.

Research and development expense increased as a percentage of net revenue as a result of our increased investment in developing new technologies and products, as well as the decrease in net revenue.

| Amortization of intangibles, cost of goods sold | $ | 34.1 | | 305.4% | $ | 8.4 | | 100.0% | $ | — | |

| Amortization of intangibles, operating expense | 22.6 | | | 23.5% | 18.3 | | | (33.7)% | 27.6 | | |

The increase in amortization for fiscal 2019, as compared to fiscal 2018, was primarily due to amortization attributable to the Avnera acquisition completed in the fourth quarter of fiscal 2018.

The decrease in the effective tax rate for fiscal 2019, as compared to the 31.1% effective rate for fiscal 2018, was primarily due to the enactment of the 2017 Tax Reform Act including a one-time charge related to the mandatory deemed repatriation tax on foreign earnings and a one-time charge related to the revaluation of our deferred tax assets and liabilities.

See [Note 8](#sEEF6925E413D58FF946A7DA8EFEA9838) to Item 8 of this Annual Report on Form 10-K for additional information regarding income taxes.

The $106.8 million increase in cash provided by operating activities for fiscal 2019, as compared to fiscal 2018, was primarily related to favorable changes in working capital driven by higher cash collections and the timing of capital expenditures and vendor payments.

The $813.5 million decrease in cash used in investing activities for fiscal 2019, as compared to fiscal 2018, was primarily related to $404.0 million paid for the Avnera acquisition in fiscal 2018 and a $401.9 million difference in the net purchase and sale of marketable securities.

Cash, cash equivalents and marketable securities totaled $1,082.2 million as of September 27, 2019, representing an increase of $32.0 million from September 28, 2018.

| Other long-term liabilities (1) | | $ | 315.5 | | | $ | — | | | $ | 38.2 | | | $ | 38.2 | | | $ | 239.1 | |

| Operating lease obligations | | 219.9 | | | | 26.7 | | | | 50.7 | | | | 44.8 | | | | 97.7 | | |

| Other commitments (2) | | 19.3 | | | | 8.6 | | | | 10.7 | | | | — | | | | — | | |

| Total | | $ | 554.7 | | | $ | 35.3 | | | $ | 99.6 | | | $ | 83.0 | | | $ | 336.8 | |

We base these estimates on the expected value method considering all reasonably available information, including our historical experience and current expectations, and is reflected in the transaction price when sales are recorded.

| Merger termination fee | — | | | — | | | 2.7 | |

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| • | Our ending cash, cash equivalents and marketable securities balance decreased 35.0% to $1,050.2 million in fiscal 2018 from $1,616.8 million in fiscal 2017. This was the result of a 13% decrease in cash from operations to $1,260.6 million in fiscal 2018 from $1,456.3 million in fiscal 2017 due to a $221.9 million increase in cash used for working capital. In addition, we returned $1,002.7 million to shareholders through repurchasing 7.7 million shares of our common stock for $759.5 million together with payments of $243.2 million in cash dividends. Lastly, we invested approximately $422.3 million in capital expenditures and $404.0 million in payments for acquisitions. |

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Gross profit was $108.9 million higher in fiscal 2018 as compared to fiscal 2017.

The increase in gross profit was primarily the result of higher unit volumes, lower overall per-unit material and manufacturing costs, and favorable product mix, with an aggregate gross profit benefit of $267.1 million.

These benefits were partially offset by the erosion of average selling price that negatively impacted gross profit by $158.2 million.

Gross profit was $176.6 million greater in fiscal 2017 as compared to fiscal 2016.

The increase in gross profit was primarily the result of higher unit volumes and lower overall per-unit material and manufacturing costs, with an aggregate gross profit benefit of $306.6 million.

These benefits were partially offset by the erosion of average selling price and changes in product mix that combined to negatively impact gross profit by $130.0 million.

As a result of these impacts, gross profit margin decreased to 50.4% of net revenue for fiscal 2017.

Research and development expense increased as a percentage of net revenue due to increased development complexity and our efforts to increase the value of our future products.

The increase in research and development expense in fiscal 2017 as compared to fiscal 2016 is primarily related to increased headcount, overall employee-related compensation expense, and expenses associated with product development activity.

Research and development expense increased slightly as a percentage of net revenue due to the aforementioned factors.

The increase in selling, general and administrative expenses in fiscal 2017 as compared to fiscal 2016 was primarily related to increases in employee-related compensation expenses, including share-based compensation, partially offset by lower legal expenses and the net gain related to the fair value adjustment of contingent consideration of $1.3 million.

Selling, general and administrative expenses decreased as a percentage of net revenue due to the aforementioned factors and the increase in net revenue.

| Amortization of purchased intangibles | $ | 20.7 | | (25.0)% | $ | 27.6 | | (17.4)% | $ | 33.4 | |

| Amortization of capitalized software | 6.0 | | | 100.0% | — | | | —% | — | | |

During fiscal 2018, $8.4 million and $18.3 million in amortization of intangibles were included in cost of goods sold and selling, general and administrative expense, respectively.

During fiscal 2017, $27.6 million in amortization of intangibles was included in selling, general and administrative expense.

The decrease in amortization for fiscal 2018 and fiscal 2017, as compared to fiscal 2017 and fiscal 2016, respectively, primarily relates to fully amortized intangible assets that were acquired in prior years partially offset by additional intangible assets acquired during the fiscal year.

MERGER TERMINATION FEE

| Merger termination fee | $ | — | | —% | $ | — | | (100.0)% | $ | 88.5 | |

| % of net revenue | — | | % | | — | | % | | 2.7 | | % |

On October 29, 2015, we entered into an Amended and Restated Agreement and Plan of Merger (the “Merger Agreement”) with PMC-Sierra, Inc. (“PMC”), providing for, subject to the terms and conditions of the Merger Agreement, our cash acquisition of PMC.

On November 23, 2015, PMC notified us that it had terminated the Merger Agreement.

As a result, on November 24, 2015, PMC paid us a termination fee of $88.5 million pursuant to the Merger Agreement.

We operate under a tax holiday in Singapore, which is effective through September 30, 2020.

This tax holiday is conditioned upon our compliance with certain employment and investment thresholds in Singapore.

The impact of the tax holiday decreased the taxes we owe in Singapore by $38.4 million and $37.4 million for fiscal 2018 and fiscal 2017, respectively.

This resulted in tax benefits of $0.21 and $0.20 of diluted earnings per share for fiscal 2018 and fiscal 2017, respectively.

The annual effective tax rate for fiscal 2017 of 19.6% was less than the United States federal statutory rate of 35.0% primarily due to benefits of 14.3% related to foreign earnings taxed at a rate less than the United States federal rate, 1.6% related to a domestic production activities deduction, and 1.3% related to the recognition of federal research and development tax credits, partially offset by income tax rate expense impact of 1.0% related to a change in our tax reserves.

See [Note 9](#sCB19CCCC855AFD0270ECB4602F2220EC) to Item 8 of this Annual Report on Form 10-K for a detailed discussion of the impact of the Tax Reform Act.

| | Fiscal Years Ended | | | | | | | | | | |

[removed: Investment] [added: *Investment] and Interest Rate [removed: Risk][added: Risk*]

Our exposure to interest rate and general market risks relates principally to our investment portfolio, which consists of cash and cash equivalents (money market funds and marketable securities purchased with less than ninety days until maturity) that total approximately [removed: $733.3] [added: $851.3] million and marketable securities (U.S. Treasury and government securities, corporate bonds and notes, municipal bonds, other government securities) that total approximately [removed: $294.1] [added: $203.3] million and [removed: $22.8] [added: $27.6] million within short-term and long-term marketable securities, respectively, as of September [removed: 28, 2018.][added: 27, 2019.]

Based on our results of operations for the fiscal year ended September [removed: 28, 2018,] [added: 27, 2019,] a hypothetical reduction in the interest rates on our cash, cash equivalents, and other investments to zero would result in an immaterial reduction of interest income with a de minimis impact on income before taxes.

[removed: Foreign] [added: *Foreign] Exchange Rate [removed: Risk][added: Risk*]

For the fiscal years ended September [added: 27, 2019, September] 28, 2018, [added: and] September 29, 2017, [removed: and September 30, 2016,] we had foreign exchange losses of [removed: $5.5] [added: $6.2] million, [removed: $3.1] [added: $5.5] million and [removed: $5.6] [added: $3.1] million, respectively.

For the fiscal year ended September [removed: 28, 2018,] [added: 27, 2019,] we had no outstanding foreign currency forward or option contracts with financial institutions.

Our key customers include Amazon, Apple, Arris, Bose, Cisco, DJI, Ericsson, Foxconn, Garmin, [removed: Gemalto,] [added: Gemalto (a Thales company),] General Electric, Google, Honeywell, HTC, Huawei, Itron, Lenovo, LG Electronics, Microsoft, Motorola, Netgear, Northrop Grumman, OPPO, Rockwell Collins, Samsung, Sierra Wireless, Sonos, Technicolor, VIVO, Xiaomi and ZTE.

Our competitors include Analog Devices, Broadcom, [added: Cirrus Logic,] Maxim Integrated Products, Murata Manufacturing, NXP Semiconductors, [removed: QUALCOMM] [added: Qorvo] and [removed: Qorvo.][added: Qualcomm.]

We operate worldwide with engineering, manufacturing, [removed: sales] [added: sales,] and service facilities throughout Asia, [removed: Europe] [added: Europe,] and North America.

In August 2018, we acquired Avnera Corporation (“Avnera”) and expanded our leadership in wireless connectivity by adding ultra-low power analog circuits to enable smart interfaces via acoustic signal processing, [removed: sensors] [added: sensors,] and integrated software.

[removed: We expect the] [added: The] acquisition of Avnera [removed: to enable] [added: enables] us to capitalize on the rapid proliferation of audio functionality and its convergence with our advanced connectivity solutions.

With our global sales channels, strong customer relationships and operational scale, we [removed: plan to leverage] [added: are leveraging] Avnera’s innovative product portfolio and systems expertise to increase our footprint in automotive, industrial, home automation, enterprise and high-end consumer markets.

[removed: INDUSTRY BACKGROUND][added: INDUSTRY BACKGROUND]

[removed: Mobile] [added: Wireless] connectivity is exploding on a global basis.

[removed: As a result,] [added: We expect that highly integrated] semiconductor solutions [removed: are becoming] [added: will play an] increasingly [removed: relevant,] [added: pivotal role in the deployment of this next generation standard by] resolving the daunting analog and RF complexities that are challenging the capabilities of existing hardware and the supporting network infrastructure.

At the same time, connectivity is [removed: proliferating] [added: expanding] into an adjacent set of IoT markets.

[removed: In fact,] IHS Markit Ltd. projects the IoT market to grow from an installed base of 15 billion units in 2015 to more than 75 billion units by 2025.

Skyworks is enabling these opportunities with highly customized system solutions supporting a broad set of wireless protocols including cellular LTE, Wi-Fi, Bluetooth®, LoRa®, [removed: Thread] [added: Thread,] and Zigbee®.

Looking [removed: ahead to 5G,] [added: forward,] we see a market that presents a [removed: massive] [added: significant] growth opportunity for our industry and [removed: certainly] for Skyworks.

On a 5G network, this content [removed: will] [added: can] be downloaded in mere seconds.

[removed: We expect the] [added: The] key catalysts for Skyworks [added: will continue] to be the insatiable demand for data and the profitable usage [removed: model for both Mobile and IoT applications,] [added: model,] as each connection becomes more valuable and [removed: vital particularly as] the world embraces 5G.

[removed: Solving] [added: Solving] Connectivity [removed: Challenges][added: Challenges]

Meeting these design challenges requires broad competencies including signal transmission and conditioning, the ability to ensure seamless hand-offs between multiple standards, power management, voltage regulation, battery charging, [removed: filtering] [added: advanced filtering,] and [removed: tuning, among others.][added: tuning.]

We have a [removed: strong] [added: rich] heritage in analog systems design and have spent the last decade investing in key technologies and resources.

[removed: SKYWORKS’ STRATEGY][added: SKYWORKS’ STRATEGY]

[removed: Industry-Leading Technology][added: Industry-Leading Technology]

As the industry migrates to more complex [removed: LTE and] 5G architectures across a multitude of wireless [removed: broadband] applications, we are [removed: uniquely] [added: well] positioned to help mobile device manufacturers handle growing levels of system complexity in the transmit and receive chain.

The trend towards increasing front-end and analog design challenges in smartphones and other [removed: mobile devices] [added: platforms] plays directly into our core strengths and positions us to address these challenges.

We also hold strong technology leadership positions in passive devices, advanced integration including proprietary shielding and 3-D die stacking as well as [removed: SAW and] [added: SAW,] TC-SAW [added: and BAW] filters.

Our product portfolio is reinforced by a library of approximately [removed: 3,000] [added: 3,500] worldwide patents and other intellectual property that we own and control.

[removed: Customer Relationships][added: Customer Relationships]

[removed: Diversification][added: Diversification]

[removed: We] [added: With the adoption of 5G and the opportunity to enable more applications, we] are steadily growing our business beyond just mobile devices (where we support all top-tier manufacturers, including the leading smartphone suppliers and key baseband vendors) into additional high-performance analog markets, including automotive, home and factory automation, infrastructure, medical, smart energy and wireless networking.

In these markets we leverage our scale, intellectual property and worldwide distribution network, which spans over [removed: 2,500] [added: 3,200] customers and over 2,500 analog components.

[removed: Delivering] [added: Delivering] Operational [removed: Excellence][added: Excellence]

[removed: Maintaining] [added: Maintaining] a [removed: Performance Driven Culture][added: Performance-Driven Culture]

We create key performance indicators that align employee efforts with corporate strategy and link responsibilities with performance [removed: measurement.]

[removed: Generating] [added: Generating] Superior Operating Results and Shareholder [removed: Returns][added: Returns]

[removed: OUR] [added: OUR] PRODUCT [removed: PORTFOLIO][added: PORTFOLIO]

[removed: MARKETING] [added: MARKETING] AND [removed: DISTRIBUTION][added: DISTRIBUTION]

[removed: CUSTOMER CONCENTRATION][added: CUSTOMER CONCENTRATION]

In the fiscal [removed: year] [added: years] ended September [added: 27, 2019 (“fiscal 2019”), and September] 28, 2018 (“fiscal 2018”), Apple Inc. (“Apple”), through sales to multiple distributors, contract manufacturers and direct sales for multiple applications including smartphones, tablets, desktop and notebook computers, watches, and other devices) constituted more than ten percent of our net revenue.

For further information regarding customer concentrations see [Note [removed: 17](#s5EF058DE6E2A69852D96B460308E491E)] [added: 15](#sD38EFE386C575F159B540359D917F6FF)] to Item 8 of this Annual Report on Form 10-K.

[removed: INTELLECTUAL] [added: INTELLECTUAL] PROPERTY AND PROPRIETARY [removed: RIGHTS][added: RIGHTS]

[added: Our efforts may not meaningfully protect our intellectual] property, or others may independently develop substantially equivalent or superior proprietary technologies, designs, devices, algorithms, processes or other intellectual property.

[removed: COMPETITIVE CONDITIONS][added: COMPETITIVE CONDITIONS]

5G is dramatically altering the world, creating an ecosystem where everyone is connected to everything, all the time—changing how individuals live, work, play, and learn.

More importantly, 5G goes well beyond simply making the mobile communications experience better by increasing reliability, adding new features, and enhancing data rates.

It is creating a market for diverse and transformative applications driven by the ability to deliver greater speeds, bandwidth and capacity, significantly lower latency, and more secure connectivity.

In fact, 5G connections will approach ten to 100 times faster than 4G speeds.

5G will also enable increasingly efficient and safe vehicle communication, paving the way for autonomous vehicles as well as networks that could make wireless healthcare a reality.

According to a June 2019 Ericsson “Mobility Report,” there are expected to be 1.9 billion mobile 5G subscriptions globally by the end of 2024 driven by “rapid early momentum and enthusiasm” in the global market.

5G technology will also support the tens of billions of connected devices, smart objects, and embedded sensors expected to come online as the IoT becomes mainstream.

Skyworks is at the forefront of this sea change in connectivity, delivering the solutions that will enable the true potential of 5G and the IoT.

Our strength is underpinned by world-class performance and scale across a broad array of capabilities that include advanced TC-SAW and BAW filters, an expanded family of MIMO, ultra-high band, and diversity receive modules and expanding into emerging technologies including millimeter wave.

From our breakthrough SKY5® unifying platform to our 5G small cell solutions, Skyworks’ approach across both infrastructure and user equipment facilitates powerful, high-speed end-to-end 5G connectivity.

measurement.

| • | Wireless ASoC: an intelligent 2.4 GHz and 5GHz wireless radio integrated circuit that includes all the analog and digital functions optimized for building wireless audio headsets, headphones, and wireless speaker systems |

| | |

| --- | --- |

personnel and protection of our intellectual property.

Our sales are primarily from the sale of semiconductor products under individual customer purchase orders, some of which have underlying master sales agreements that specify terms governing the product sales.

In the absence of a sales agreement, the Company’s standard terms and conditions apply.

in December and the fourth fiscal quarter ending in September.

In August 2016, we acquired the remaining 34 percent interest in a joint venture that was initially created in August 2014 with Panasonic Corporation, through its Automotive & Industrial Systems Company (“Panasonic”) for the design, manufacture and sale of Panasonic’s SAW and TC-SAW filter products.

The joint venture was dissolved and is now a wholly-owned subsidiary of the Company.

With the overall demand for SAW and TC-SAW filters increasing and as technology and product architectures become more complex and the number of required bands grows, this investment assists us in securing a consistent supply of SAW and TC-SAW filters, in addition to allowing us to integrate filters into the design and production of our own products.

With wireless platforms serving as virtual hubs for e-commerce, enterprise to the cloud, social media, gaming and entertainment, these devices are enabling a new, multi-trillion dollar economy.

Popular apps including Amazon, Facebook, Netflix, Spotify, Uber, Waze and YouTube all require ultra-fast, highly secure, low-latency, always-on connectivity plus GPS location-based services.

Semiconductor devices continue becoming smaller, more powerful, and easier to integrate across multiple communication protocols, which in turn is enabling mobile and IoT ecosystems.

Skyworks facilitates ubiquitous data creation, delivery and storage as smartphones transmit and receive immense amounts of content supporting multimedia streaming, social networking, virtual reality and emerging frictionless commerce.

To enable these applications, we deliver highly integrated solutions leveraging our amplification, filtering, tuning, power management, audio processing and packaging capabilities to continuously push the performance envelope.

Demand for connectivity across emerging markets around the world also continues to grow as the industry drives toward connecting the billions of people who remain unconnected.

According to The GSMA Foundation, there will be 5.9 billion mobile subscribers by 2025, representing almost three-quarters of the world’s population.

Subscriber growth over this period is forecast to be driven primarily by large markets in Asia, such as India, which alone is expected to add 310 million new unique subscribers by 2020.

5G data rates will approach ten to 100 times the fastest 4G speeds of today with near zero latency.

By 2020 a single autonomous car is expected to consume 4,000 gigabytes of data per day in real-time diagnostics, positioning and vehicle-to-vehicle communications—that is equivalent to the daily data consumed by more than 2,000 smartphone users today.

The transition to ubiquitous connectivity creates challenges to existing architectures.

RF solutions in ultra-thin, high performance consumer products must increase data rates, solve signal interference problems, and occupy minimal board space while at the same time increasing battery life.

This complexity plays directly to our strengths.

We are at the forefront of advanced multi-chip module integration and offer unmatched technology breadth, providing deep expertise in CMOS, SOI, GaAs and filters, and maintain strategic partnerships with outside independent wafer fabrication facilities.

In the fiscal year ended September 30, 2016 (“fiscal 2016”), two customers—Apple and Samsung—each constituted more than ten percent of our net revenue.

Our efforts may not meaningfully protect our intellectual

Our sales are made pursuant to standard purchase orders and specified customer contracts for delivery of products, with such purchase orders officially acknowledged by us according to our own terms and conditions.

The information set forth under [Note [removed: 13](#s284895CED8527821F54AB460304056A1)] [added: 11](#s739A64BE7B1256C586A37E51ADF50E74)] of Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K is incorporated herein by reference.

[removed: UNITED] [added: UNITED] STATES SECURITIES AND EXCHANGE [removed: COMMISSION][added: COMMISSION]

[removed: Washington,] [added: Washington,] D.C. [removed: 20549][added: 20549]

[removed: FORM 10-K][added: FORM 10-K]

| [removed: þ] [added: ☑] | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |

[removed: For] [added: For] the fiscal year [removed: ended September 28, 2018][added: ended September 27, 2019]

| [removed: o] [added: ☐] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |

[removed: For] [added: For] the transition period from [removed: __________to__________][added: __________to__________]

[removed: Commission] [added: Commission] file [removed: number 001-05560][added: number 001-05560]

[removed: SKYWORKS SOLUTIONS, INC.][added: Skyworks Solutions, Inc.]

[removed: (Exact] [added: *(Exact] name of registrant as specified in its [removed: charter)][added: charter)*]

| [removed: Delaware] [added: Delaware] | [removed: 04-2302115] [added: 04-2302115] |

| [removed: (State] [added: *(State] or other jurisdiction [removed: of incorporation] [added: of* *incorporation] or [removed: organization)] [added: organization)*] | [removed: (I.R.S.] [added: *(I.R.S.] Employer Identification [removed: No.)] [added: No.)*] |

| [removed: 20] [added: 20] Sylvan [removed: Road, Woburn, Massachusetts] [added: Road,] | [removed: 01801] [added: Woburn] | [added: Massachusetts | 01801 | |]

| [removed: (Address] [added: *(Address] of principal executive [removed: offices)] [added: offices)*] | [removed: (Zip Code)] | [added: | *(Zip Code)* | |]

| [removed: Registrant’s] [added: *(Registrant’s] telephone number, including area [removed: code: (781) 376-3000] [added: code)*] | | [added: | | |]

[removed: Securities] [added: Securities] registered pursuant to Section 12(b) of the [removed: Act:][added: Act:]

| [removed: Title] [added: Title] of [removed: Each Class] [added: each class] | [removed: Name] [added: | Trading Symbol | Name] of [removed: Each Exchange] [added: each exchange] on [removed: Which Registered] [added: which registered] |

| Common Stock, par value $0.25 per share | [added: | SWKS |] Nasdaq Global Select Market |

[removed: Securities] [added: Securities] registered pursuant to Section 12(g) of the Act: [removed: None][added: None]

[removed: o] [added: ☐] Yes þ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T [added: (§ 232.405 of this chapter)] during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

| Large [removed: Accelerated] [added: accelerated] filer [added: |] þ | Accelerated filer [removed: o] [added: ☐] | Non-accelerated filer [removed: o] [added: ☐] | Smaller reporting company [removed: o] | [added: ☐ |] Emerging growth company [removed: o] | [added: ☐ |]

The aggregate market value of the registrant’s common stock held by non-affiliates of the registrant (based on the closing price of the registrant’s common stock as reported on the Nasdaq Global Select Market on the last business day of the registrant’s most recently completed second fiscal quarter March [removed: 30, 2018)] [added: 29, 2019)] was approximately [removed: $18.2] [added: $14.2] billion.

The number of outstanding shares of the registrant’s common stock, par value $0.25 per share, as of November [removed: 7, 2018,] [added: 12, 2019,] was [removed: 177,531,995.][added: 170,375,324.]

[removed: DOCUMENTS] [added: DOCUMENTS] INCORPORATED BY [removed: REFERENCE][added: REFERENCE]

| Part III | | Portions of the Registrant’s Proxy Statement relating to the Registrant’s [removed: 2018] [added: 2020] Annual Meeting of Stockholders (to be filed) are incorporated by reference into Items 10, 11, 12, 13 and 14 of this Annual Report on Form 10-K. |

FOR THE YEAR ENDED SEPTEMBER [removed: 28, 2018][added: 27, 2019]

[removed: | [PART I](#sCAA68C864E806C740780B4603E2681BA) | |][added: PART l]

| [ITEM 1: [removed: BUSINESS.](#sA3397E771434526476E1B4603E4682F2)] [added: BUSINESS.](#sE20C464EEC875A078153F21CBB432E0C)] | [removed: [5](#sA3397E771434526476E1B4603E4682F2)] [added: [5](#sE20C464EEC875A078153F21CBB432E0C)] |

| [ITEM 1A: RISK [removed: FACTORS.](#s4EC3EB606B155BD10E96B4603E6D4828)] [added: FACTORS.](#sF8930A0C1A5A591F80290F080BCCDA40)] | [removed: [10](#s4EC3EB606B155BD10E96B4603E6D4828)] [added: [10](#sF8930A0C1A5A591F80290F080BCCDA40)] |

| [ITEM 1B: UNRESOLVED STAFF [removed: COMMENTS.](#s7C43C6304C01E29E3565B4603E9B61EE)] [added: COMMENTS.](#sAF4B27737A1D5CCD908170A9FE2DBB6B)] | [removed: [21](#s7C43C6304C01E29E3565B4603E9B61EE)] [added: [21](#sAF4B27737A1D5CCD908170A9FE2DBB6B)] |

| [ITEM 2: [removed: PROPERTIES.](#sAC58972F18805B4EC036B4603ECA88C4)] [added: PROPERTIES.](#sD7CB92601A115CB5AFCBF1520D503E2D)] | [removed: [21](#sAC58972F18805B4EC036B4603ECA88C4)] [added: [21](#sD7CB92601A115CB5AFCBF1520D503E2D)] |

| [ITEM 3: LEGAL [removed: PROCEEDINGS.](#sA44EFD838BB26B28D278B4603EEA5258)] [added: PROCEEDINGS.](#s95164D4226535CAAA34449C45AC36DBA)] | [removed: [22](#sA44EFD838BB26B28D278B4603EEA5258)] [added: [22](#s95164D4226535CAAA34449C45AC36DBA)] |

| [ITEM 4: MINE SAFETY [removed: DISCLOSURES](#s1E584413BFFA31C82634B4603F191189).] [added: DISCLOSURES](#s1666FADD6AF15AF4BAD02828C1EAB36E).] | [removed: [22](#s1E584413BFFA31C82634B4603F191189)] [added: [22](#s1666FADD6AF15AF4BAD02828C1EAB36E)] |

| [ITEM 5: MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY [removed: SECURITIES.](#sE19070BB048C009D231BB4603F86A6FD)] [added: SECURITIES.](#s2027868C4D9F5A279FEF18214BEA8DBA)] | [removed: [23](#sE19070BB048C009D231BB4603F86A6FD)] [added: [23](#s2027868C4D9F5A279FEF18214BEA8DBA)] |

| [ITEM 6: SELECTED FINANCIAL [removed: DATA.](#sB14C564F5B88AE8B1C49B460371CD4F1)] [added: DATA.](#s4B881E42203A5F76A57EE7AD77A748F6)] | [removed: [24](#sB14C564F5B88AE8B1C49B460371CD4F1)] [added: [24](#s4B881E42203A5F76A57EE7AD77A748F6)] |

| [ITEM 7: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF [removed: OPERATIONS.](#s06259CCBDD8509DCCED2B4603FC47FF5)] [added: OPERATIONS.](#s5DC147E034B2527B91676ED4AC2C9658)] | [removed: [25](#s06259CCBDD8509DCCED2B4603FC47FF5)] [added: [25](#s5DC147E034B2527B91676ED4AC2C9658)] |

| [ITEM 7A: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET [removed: RISK.](#s38630D647B72929E1D7AB46040BFCDA1)] [added: RISK.](#s2FDDA5E34A83554FB0D6D30F5C65268E)] | [removed: [32](#s38630D647B72929E1D7AB46040BFCDA1)] [added: [30](#s2FDDA5E34A83554FB0D6D30F5C65268E)] |

| [ITEM 8: FINANCIAL STATEMENTS AND SUPPLEMENTARY [removed: DATA.](#s8C05C2885FCC1FF5E12FB4603509A819)] [added: DATA.](#sAC0485BAE2825DF8B26C454B59214FD8)] | [removed: [33](#s8C05C2885FCC1FF5E12FB4603509A819)] [added: [32](#sAC0485BAE2825DF8B26C454B59214FD8)] |

| [ITEM 9: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL [removed: DISCLOSURE.](#sCBCC4A956CE88EF39E5FB460464E8E9A)] [added: DISCLOSURE.](#s005EFAA7ABBF5471B43C33DA68437B71)] | [removed: [64](#sCBCC4A956CE88EF39E5FB460464E8E9A)] [added: [59](#s005EFAA7ABBF5471B43C33DA68437B71)] |

OR

| | | | | |

| (781) | | | 376-3000 | |

| | | | |

| --- | --- | --- | --- |

| | | | |

| | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | |

| [PART II](#s4FA2636EFCFA50A681B608BE6416BCF4) | |

| [PART IV](#s5D2FC14983305EF6B27C03A17DC3EDFF) | |

| [SIGNATURES](#s4F4C68B582B85ECEABC40D1444F4CEE3) | [64](#s4F4C68B582B85ECEABC40D1444F4CEE3) |

| • | 5G (Fifth Generation): next-generation cellular network technology |

| • | ASoC (Analog System on Chip): combines the required electronic circuits of various computer components into a single, integrated chip. |

| • | BAW (Bulk Acoustic Wave): electrical input signal is converted to an acoustic wave for filtering and converted back into an electrical signal by a metal-piezo-metal vertical structure |

| • | MIMO (Multiple In, Multiple Out): a method for multiplying the capacity of a radio link using multiple transmission and receiving antennas to exploit multipath propagation; more commonly, it refers to LTE, 5G, and Wi-Fi techniques to send more than one data signal (also known as data layers) with encoded information to increase capacity in modern telecommunications systems |

| --- | --- |

| --- | --- |

10-K 1 fy1810k92818.htm 10-K

| | |

OR

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

| [PART II](#sD96551914C828505052CB4603F388602) | |

| [PART IV](#s27EB0FB27A13B51CD22DB46047B5508E) | |

| [SIGNATURES](#sB1E81B953A909C872A74B46048909D77) | [70](#sB1E81B953A909C872A74B46048909D77) |

[removed: None.][added: *None.*]

For information regarding property, plant and equipment by geographic region for each of the last three fiscal years, see [Note [removed: 17](#s5EF058DE6E2A69852D96B460308E491E)] [added: 15](#sD38EFE386C575F159B540359D917F6FF)] to Item 8 of this Annual Report on Form 10-K.

| [removed: Location] [added: Location] | | [removed: Owned/Leased] [added: Owned/Leased] | | [removed: Square Footage] [added: Square Footage] | | [removed: Primary Function] [added: Primary Function] |

| Singapore, Singapore | | Leased | | [removed: 176,800] [added: 298,800] | | Filter manufacturing |

| Irvine, California | | Leased | | [removed: 126,900] [added: 218,500] | | Design center and office space |

| Ottawa, Ontario | | Leased | | [removed: 33,200] [added: 82,200] | | Design center |

| Hillsboro, Oregon | | Leased | | [removed: 21,200] [added: 59,500] | | Design center and office space |

[removed: Not Applicable.][added: *Not Applicable.*]

[removed: PART II][added: PART II]

[removed: MARKET] [added: MARKET] INFORMATION AND [removed: DIVIDENDS][added: DIVIDENDS]

The number of stockholders of record of our common stock as of November [removed: 7, 2018,] [added: 12, 2019,] was [removed: 12,404.][added: 11,174.]

On November [removed: 8, 2018,] [added: 12, 2019,] the Company announced that the Board of Directors had declared a cash dividend of [removed: $0.38] [added: $0.44] per share of common stock, payable on December [removed: 18, 2018,] [added: 24, 2019,] to stockholders of record as of [removed: November 27, 2018.][added: December 3, 2019.]

[removed: ISSUER] [added: ISSUER] PURCHASES OF EQUITY [removed: SECURITIES][added: SECURITIES]

The following table provides information regarding repurchases of common stock made during the fiscal quarter ended September [removed: 28, 2018:][added: 27, 2019:]

| [removed: Period] [added: Period] | [removed: Total] [added: Total] Number of Shares [removed: Purchased] [added: Purchased] | [removed: Average] [added: Average] Price Paid per [removed: Share] [added: Share] | [removed: Total] [added: Total] Number of Shares Purchased as Part of Publicly Announced Plans or Programs [removed: (1)] [added: (1)] | [removed: Maximum] [added: Maximum] Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs [removed: (1)] [added: (1)] |

(1) The stock repurchase program approved by the Board of Directors on January [removed: 31, 2018,] [added: 30, 2019,] authorizes the repurchase of up to [removed: $1.0] [added: $2.0] billion of our common stock from time to time on the open market or in privately negotiated transactions as permitted by securities laws and other legal requirements.

The January [removed: 31, 2018,] [added: 30, 2019,] stock repurchase program [removed: replaces] [added: replaced] in its entirety the January [removed: 17, 2017,] [added: 31, 2018,] plan and is scheduled to expire on January [removed: 31, 2020.][added: 30, 2021.]

[removed: (2) 828,483] [added: (3) 772,437] shares were repurchased at an average price of [removed: $97.56] [added: $76.73] per share as part of our stock repurchase program, and [removed: 1,423] [added: 8,377] shares were repurchased by us at the fair market value of the common stock as of the applicable purchase date, in connection with the satisfaction of tax withholding obligations under equity award agreements with an average price of [removed: $96.91] [added: $76.33] per share.

[removed: (3) 715,597] [added: (4) 1,160,559] shares were repurchased at an average price of [removed: $93.62] [added: $75.01] per share as part of our stock repurchase program, and [removed: 2,919] [added: 3,099] shares were repurchased by us at the fair market value of the common stock as of the applicable purchase date, in connection with the satisfaction of tax withholding obligations under equity award agreements with an average price of [removed: $91.52] [added: $74.95] per share.

[removed: (4) 1,000,000 shares were repurchased at an average price of $87.12 per share as part of our stock repurchase program, and 2,162] [added: (2) Represents] shares [removed: were] repurchased by us at the fair market value of the common stock as of the applicable purchase date, in connection with the satisfaction of tax withholding obligations under equity award [removed: agreements with an average price of $93.02 per share.][added: agreements.]

| 6/29/19-7/26/19 | 1,277(2) | $81.69 | — | $1.77 billion |

| 7/27/19-8/23/19 | 780,814(3) | $76.72 | 772,437 | $1.71 billion |

| 8/24/19-9/27/19 | 1,163,658(4) | $75.00 | 1,160,559 | $1.63 billion |

| Total | 1,945,749 | | 1,932,996 | |

| 6/30/18-7/27/18 | 829,906 (2) | $97.56 | 828,483 | $567.1 million |

| 7/28/18-8/24/18 | 718,516(3) | $93.61 | 715,597 | $500.1 million |

| 8/25/18-9/28/18 | 1,002,162(4) | $87.13 | 1,000,000 | $413.0 million |

| Total | 2,550,584 | | 2,544,080 | |

On November 15, 2017, we agreed to potentially issue not more than 1% of our common stock to an unaffiliated third party as contingent consideration for its role under a multi-year collaboration agreement.

The shares are issuable for no cash payment but only upon the achievement of certain product sale milestones, certain terminations of the agreement or if the Company engages in certain competition with the third party.

Though the timing is not certain, the Company does not expect achievement of the product sale milestones to occur any time prior to mid-2020.

The transaction was made in reliance on the exemption from registration in Section 4(a)(2) of the Securities Act.

The Company has agreed to file a registration statement with the Securities and Exchange Commission registering the resale of any issued shares.

The information set forth below for the five years ended September [removed: 28, 2018,] [added: 27, 2019,] is not necessarily indicative of results of future operations, and should be read in conjunction with Part II, Item 7, [removed: Management’s] [added: *Management’s] Discussion and Analysis of Financial Condition and Results of [removed: Operations,] [added: Operations*,] and our consolidated financial statements and related notes included in Part II, Item 8 of this Annual Report on Form 10-K to fully understand factors that may affect the comparability of the information presented below.

Fiscal [added: 2019,] 2018, 2017, 2016, and 2015 each consisted of 52 weeks and ended on September [added: 27, 2019, September] 28, 2018, September 29, 2017, September 30, 2016, and October 2, 2015, respectively.

| | [removed: Fiscal] [added: Fiscal] Years [removed: Ended] [added: Ended] | | | | | | | | | | | | | | | | | | |

| [removed: Statement] [added: Statement] of Operations [removed: Data:] [added: Data:] | [removed: September] [added: September 27, 2019 (1) | | | | September] 28, 2018 [removed: (2)] [added: (2)] | | | | [removed: September] [added: September] 29, [removed: 2017] [added: 2017] | | | | [removed: September] [added: September] 30, 2016 [removed: (1)] [added: (3)] | | | | [removed: October] [added: October] 2, [removed: 2015 | | | | October 3, 2014] [added: 2015] | | |

| Net revenue | $ | [removed: 3,868.0] [added: 3,376.8] | | | $ | [removed: 3,651.4] [added: 3,868.0] | | | $ | [removed: 3,289.0] [added: 3,651.4] | | | $ | [removed: 3,258.4] [added: 3,289.0] | | | $ | [removed: 2,291.5] [added: 3,258.4] | |

| Operating income | $ | [removed: 1,319.3] [added: 952.0] | | | $ | [removed: 1,253.8] [added: 1,319.3] | | | $ | [removed: 1,118.7] [added: 1,253.8] | | | $ | [removed: 1,023.1] [added: 1,118.7] | | | $ | [removed: 565.2] [added: 1,023.1] | |

| Operating margin | [removed: 34.1] [added: 28.2] | | % | | [removed: 34.3] [added: 34.1] | | % | | [removed: 34.0] [added: 34.3] | | % | | [removed: 31.4] [added: 34.0] | | % | | [removed: 24.7] [added: 31.4] | | % |

| Net income | $ | [removed: 918.4] [added: 853.6] | | | $ | [removed: 1,010.2] [added: 918.4] | | | $ | [removed: 995.2] [added: 1,010.2] | | | $ | [removed: 798.3] [added: 995.2] | | | $ | [removed: 457.7] [added: 798.3] | |

| Basic | $ | [removed: 5.06] [added: 4.92] | | | $ | [removed: 5.48] [added: 5.06] | | | $ | [removed: 5.27] [added: 5.48] | | | $ | [removed: 4.21] [added: 5.27] | | | $ | [removed: 2.44] [added: 4.21] | |

| Diluted | $ | [removed: 5.01] [added: 4.89] | | | $ | [removed: 5.41] [added: 5.01] | | | $ | [removed: 5.18] [added: 5.41] | | | $ | [removed: 4.10] [added: 5.18] | | | $ | [removed: 2.38] [added: 4.10] | |

| Cash dividends declared per share | $ | [removed: 1.34] [added: 1.58] | | | $ | [removed: 1.16] [added: 1.34] | | | $ | [removed: 1.06] [added: 1.16] | | | $ | [removed: 0.65] [added: 1.06] | | | $ | [removed: 0.22] [added: 0.65] | |

| [removed: Balance] [added: Balance] Sheet [removed: Data:] [added: Data:] | [removed: September 28, 2018 (2)] [added: September 27, 2019] | | | | [removed: September 29, 2017] [added: September 28, 2018] | | | | [removed: September 30, 2016 (1)] [added: September 29, 2017] | | | | [removed: October 2, 2015] [added: September 30, 2016] | | | | [removed: October 3, 2014] [added: October 2, 2015] | | |

| Working capital | $ | [removed: 1,872.5] [added: 1,860.6] | | | $ | [removed: 2,245.8] [added: 1,872.5] | | | $ | [removed: 1,791.9] [added: 2,245.8] | | | $ | [removed: 1,450.8] [added: 1,791.9] | | | $ | [removed: 1,131.6] [added: 1,450.8] | |

| Property, plant and equipment, net | $ | [removed: 1,140.9] [added: 1,205.6] | | | $ | [removed: 882.3] [added: 1,140.9] | | | $ | [removed: 806.3] [added: 882.3] | | | $ | [removed: 826.4] [added: 806.3] | | | $ | [removed: 555.9] [added: 826.4] | |

| Total assets | $ | [removed: 4,828.9] [added: 4,839.6] | | | $ | [removed: 4,573.6] [added: 4,828.9] | | | $ | [removed: 3,855.4] [added: 4,573.6] | | | $ | [removed: 3,719.4] [added: 3,855.4] | | | $ | [removed: 2,973.8] [added: 3,719.4] | |

| Stockholders’ equity | $ | [removed: 4,097.0] [added: 4,122.3] | | | $ | [removed: 4,065.7] [added: 4,097.0] | | | $ | [removed: 3,541.4] [added: 4,065.7] | | | $ | [removed: 3,159.2] [added: 3,541.4] | | | $ | [removed: 2,532.4] [added: 3,159.2] | |

[removed: (1)] [added: (3)] Fiscal 2016 net income and earnings per share include other income of $88.5 million related to the receipt of [removed: the PMC-Sierra] [added: a] merger termination [removed: fee.][added: fee in November 2015 in connection with the termination by PMC-Sierra, Inc. (“PMC”), of the Amended and Restated Agreement and Plan of Merger that we had entered into with PMC in October 2015.]

| | As of | | | | | | | | | | | | | | | | | | |

(1) Fiscal 2019 net revenue, net income, and earnings per share were adversely impacted as a result of the U.S. Bureau of Industry and Security of the U.S. Department of Commerce placing Huawei and certain of its affiliates on the Bureau’s Entity List (the “Entity List”) in May 2019.

Fiscal 2014 consisted of 53 weeks and ended on October 3, 2014.

| | As of | | | | | | | | | | | | | | | | | | |

| (1) | [Report of Independent Registered Public Accounting [removed: Firm](#s88AB469818E21EE7CE22B460410D3659)] [added: Firm](#sA72E2E9684C35B3E8BA6F3DF807D7B9C)] | Page [removed: [34](#s88AB469818E21EE7CE22B460410D3659)] [added: [33](#sA72E2E9684C35B3E8BA6F3DF807D7B9C)] |

| (2) | [Consolidated Statements of Operations for the three years ended September [removed: 28, 2018](#s13EE88FA0C64602A1FC3B4602D08A910)] [added: 27, 2019](#sF5797D1334995F7CBB37D3A0B7198D82)] | Page [removed: [36](#s13EE88FA0C64602A1FC3B4602D08A910)] [added: [35](#sF5797D1334995F7CBB37D3A0B7198D82)] |

| (3) | [Consolidated Statements of Comprehensive Income for the three years ended September [removed: 28, 2018](#s9E8D64E2696CC271273BB4602D364211)] [added: 27, 2019](#s25669B8FAE765B609290E3C6C83874D8)] | Page [removed: [37](#s9E8D64E2696CC271273BB4602D364211)] [added: [36](#s25669B8FAE765B609290E3C6C83874D8)] |

| (4) | [Consolidated Balance Sheets at September [removed: 28, 2018,] [added: 27, 2019,] and September [removed: 29, 2017](#s9B2605B3F8C0D03A0600B4602D487328)] [added: 28, 2018](#s9587151A8B9B5D2A85DB2AC2A3667EFA)] | Page [removed: [38](#s9B2605B3F8C0D03A0600B4602D487328)] [added: [37](#s9587151A8B9B5D2A85DB2AC2A3667EFA)] |

| (5) | [Consolidated Statements of Cash Flows for the three years ended September [removed: 28, 2018](#sE521504A6E010AADE194B4602D87D04F)] [added: 27, 2019](#s01CFC479576B5511A7DCD8056A94F32B)] | Page [removed: [39](#sE521504A6E010AADE194B4602D87D04F)] [added: [38](#s01CFC479576B5511A7DCD8056A94F32B)] |

| (6) | [Consolidated Statements of Stockholders’ Equity for the three years ended September [removed: 28, 2018](#s49805281E59A87302F8CB4602DCA5122)] [added: 27, 2019](#s7215CF68D32D592A85B32993306773D4)] | Page [removed: [40](#s49805281E59A87302F8CB4602DCA5122)] [added: [39](#s7215CF68D32D592A85B32993306773D4)] |

| (7) | [Notes to Consolidated Financial [removed: Statements](#s4B214CAEA8C47925433AB460425A2061)] [added: Statements](#sBCAA503586C75579B8D62BD65BD83FF8)] | Page [removed: [41](#s4B214CAEA8C47925433AB460425A2061)] [added: [40](#sBCAA503586C75579B8D62BD65BD83FF8)] through [removed: [62](#s47916B9213DB6A4C265DB46030CC482E)] [added: [57](#sEF07D26D464658DE9BA19DA3C2BC236C)] |

[removed: Report] [added: Report] of Independent Registered Public Accounting [removed: Firm][added: Firm]

[removed: Opinions] [added: *Opinions] on the Consolidated Financial Statements and Internal Control Over Financial [removed: Reporting][added: Reporting*]

We have audited the accompanying consolidated balance sheets of Skyworks Solutions, Inc. and subsidiaries (the Company) as of September [removed: 28, 2018] [added: 27, 2019] and September [removed: 29, 2017,] [added: 28, 2018,] the related consolidated statements of operations, comprehensive income, cash [removed: flows,] [added: flows] and [removed: stockholders'] [added: stockholders’] equity for each of the years in the three-year period ended September [removed: 28, 2018,] [added: 27, 2019] and the related notes (collectively, the [removed: “consolidated] [added: consolidated] financial [removed: statements”).][added: statements).]

We also have audited the Company’s internal control over financial reporting as of September [removed: 28, 2018,] [added: 27, 2019,] based on criteria established in [removed: Internal] [added: *Internal] Control - Integrated [removed: Framework (2013)] [added: Framework* *(2013)*] issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of September [removed: 28, 2018] [added: 27, 2019] and September [removed: 29, 2017,] [added: 28, 2018,] and the results of its operations and its cash flows for each of the years in the three-year period ended September [removed: 28, 2018,] [added: 27, 2019,] in conformity with U.S. generally accepted accounting principles.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September [removed: 28, 2018,] [added: 27, 2019] based on criteria established in [removed: Internal] [added: *Internal] Control - Integrated Framework [removed: (2013)] [added: (2013)*] issued by the Committee of Sponsoring Organizations of the Treadway Commission.

[removed: Basis] [added: *Basis] for [removed: Opinions][added: Opinions*]

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying [removed: Management’s] [added: *Management’s] Annual Report on Internal Control over Financial [removed: Reporting.][added: Reporting*.]

[removed: Definition] [added: *Definition] and Limitations of Internal Control Over Financial [removed: Reporting][added: Reporting*]

[removed: A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally] accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

[removed: SKYWORKS] [added: SKYWORKS] SOLUTIONS, [removed: INC.][added: INC.]

[removed: CONSOLIDATED] [added: CONSOLIDATED] STATEMENTS OF [removed: OPERATIONS][added: OPERATIONS]

| | [removed: Fiscal] [added: Fiscal] Years [removed: Ended] [added: Ended] | | | | | | | | | | |

| | [removed: September 28, 2018] [added: September 27, 2019] | | | | [removed: September 29, 2017] [added: September 28, 2018] | | | | [removed: September 30, 2016] [added: September 29, 2017] | | |

| Net revenue | $ | [removed: 3,868.0] [added: 3,376.8] | | | $ | [removed: 3,651.4] [added: 3,868.0] | | | $ | [removed: 3,289.0] [added: 3,651.4] | |

| Cost of goods sold | [removed: 1,917.3] [added: 1,773.0] | | | | [removed: 1,809.6] [added: 1,917.3] | | | | [removed: 1,623.8] [added: 1,809.6] | | |

| Gross profit | [removed: 1,950.7] [added: 1,603.8] | | | | [removed: 1,841.8] [added: 1,950.7] | | | | [removed: 1,665.2] [added: 1,841.8] | | |

| Research and development | [removed: 404.5] [added: 424.1] | | | | [removed: 355.2] [added: 404.5] | | | | [removed: 312.4] [added: 355.2] | | |

| Selling, general and administrative | [removed: 207.8] [added: 198.3] | | | | [removed: 204.6] [added: 207.8] | | | | [removed: 195.9] [added: 204.6] | | |

| Amortization of intangibles | [removed: 18.3] [added: 22.6] | | | | [removed: 27.6] [added: 18.3] | | | | [removed: 33.4] [added: 27.6] | | |

| Restructuring and other charges | [removed: 0.8] [added: 6.8] | | | | [removed: 0.6] [added: 0.8] | | | | [removed: 4.8] [added: 0.6] | | |

| Total operating expenses | [removed: 631.4] [added: 651.8] | | | | [removed: 588.0] [added: 631.4] | | | | [removed: 546.5] [added: 588.0] | | |

| Operating income | [removed: 1,319.3] [added: 952.0] | | | | [removed: 1,253.8] [added: 1,319.3] | | | | [removed: 1,118.7] [added: 1,253.8] | | |

| Other [removed: income (expense),] [added: income,] net | [removed: 12.8] [added: 9.0] | | | | [removed: 3.2] [added: 12.8] | | | | [removed: (6.6] [added: 3.2] | | [removed: )] |

| Income before income taxes | [removed: 1,332.1] [added: 961.0] | | | | [removed: 1,257.0] [added: 1,332.1] | | | | [removed: 1,200.6] [added: 1,257.0] | | |

| Provision for income taxes | [removed: 413.7] [added: 107.4] | | | | [removed: 246.8] [added: 413.7] | | | | [removed: 205.4] [added: 246.8] | | |

| Net income | $ | [removed: 918.4] [added: 853.6] | | | $ | [removed: 1,010.2] [added: 918.4] | | | $ | [removed: 995.2] [added: 1,010.2] | |

| Basic | $ | [removed: 5.06] [added: 4.92] | | | $ | [removed: 5.48] [added: 5.06] | | | $ | [removed: 5.27] [added: 5.48] | |

| Diluted | $ | [removed: 5.01] [added: 4.89] | | | $ | [removed: 5.41] [added: 5.01] | | | $ | [removed: 5.18] [added: 5.41] | |

| Basic | [removed: 181.3] [added: 173.5] | | | | [removed: 184.3] [added: 181.3] | | | | [removed: 188.7] [added: 184.3] | | |

| Diluted | [removed: 183.2] [added: 174.5] | | | | [removed: 186.7] [added: 183.2] | | | | [removed: 192.1] [added: 186.7] | | |

| Cash dividends declared and paid per share | $ | [removed: 1.34] [added: 1.58] | | | $ | [removed: 1.16] [added: 1.34] | | | $ | [removed: 1.06] [added: 1.16] | |

[removed: SKYWORKS] [added: SKYWORKS] SOLUTIONS, [removed: INC.][added: INC.]

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally

*Critical Audit Matter*

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgment.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

As discussed in Notes 2 and 8 to the consolidated financial statements, the Company has recorded gross unrecognized tax benefits of $103.3 million in domestic and foreign jurisdictions as of September 27, 2019.

The Company records unrecognized tax benefits when there is more than a 50% likelihood that its tax positions will not be sustained upon examination by the taxing authorities.

This determination requires the Company’s judgement in the interpretation of domestic and international tax laws and regulations.

We identified the assessment of the gross unrecognized tax benefits as a critical audit matter because of the high degree of auditor judgement involved in evaluating the Company’s interpretation of domestic and international tax laws and regulations.

The primary procedures we performed to address this critical audit matter included the following.

We tested certain internal controls over the Company’s unrecognized tax benefit process, including controls over the interpretation of domestic and international tax laws and regulations.

We involved domestic and international tax professionals with specialized skills and knowledge, who assisted in:

| • | assessing the Company’s ongoing compliance with applicable domestic and international tax laws and regulations, |

| • | reading the Company’s documentation that provided the basis for its tax positions and evaluating the impact of changes in the Company’s tax structure, changes in domestic and international tax laws and regulations, and similar settlements with applicable taxing authorities, and |

| • | evaluating the Company’s interpretation of domestic and international tax laws and regulations by developing an independent assessment based on our understanding and interpretation of the domestic and international tax laws and regulations. |

November 14, 2019

| | As of | | | | | | |

| Stock repurchase program | (8.9 | ) | | (2.2 | | ) | | 8.9 | | | (657.6 | | ) | | 2.2 | | | | — | | | | — | | | | (657.6 | | ) |

| Balance at September 27, 2019 | 170.1 | | | $ | 42.5 | | | 60.1 | | | $ | (3,412.9 | ) | | $ | 3,188.0 | | | $ | 4,312.6 | | | $ | (7.9 | ) | | $ | 4,122.3 | |

1.

2.

The cost of securities sold is determined based on the specific identification method.

The Company derives its revenue primarily from the sale of semiconductor products under individual customer purchase orders, some of which have underlying master sales agreements that specify terms governing the product sales.

In the absence of a sales agreement, the Company’s standard terms and conditions apply.

Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.

The Company applies a five-step approach as defined in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (Topic 606), in determining the amount and timing of revenue to be recognized: (1) identifying the contract with a customer; (2) identifying the performance obligations in the contract; (3) determining the transaction price; (4) allocating the transaction price to the performance obligations in the contract; and (5) recognizing revenue when the corresponding performance obligation is satisfied.

Each distinct promise to transfer products is considered to be an identified performance obligation for which revenue is recognized at a point in time upon transfer of control of the products to the customer.

Transfer of control occurs upon shipment to the distributor or direct customer or when products are pulled from consignment inventory by the customer.

Point in time recognition is determined as products manufactured under non-cancellable orders create an asset with an alternative use to the Company.

Returns under the Company’s general assurance warranty of products have not been material, and warranty-related services are not considered a separate performance obligation.

As of September 27, 2019, the amount of remaining performance obligation that has not been recognized as revenue is not material.

Pricing adjustments and estimates of returns are treated as variable consideration for purposes of determining the transaction price.

Sales returns are generally accepted at the Company’s discretion or from distributors with stock rotation rights.

Stock rotation allows distributors limited levels of returns and is based on the distributor’s prior purchases.

Price protection represents price discounts granted to certain distributors and is based on negotiations on sales to end customers.

Variable consideration is estimated using the expected value method considering all reasonably available information, including the Company’s historical experience and its current expectations, and is reflected in the transaction price when sales are recorded.

The Company records net revenue excluding taxes collected on its sales to trade customers.

Accounts receivable represents the Company’s unconditional right to receive consideration from its customer.

Substantially all payments are collected within the Company’s standard terms, which do not include a significant financing component.

To date, there have been no material impairment losses on accounts receivable.

There were no material contract assets or contract liabilities recorded on the consolidated balance sheet in any of the periods presented.

November 14, 2018

| Merger termination fee | — | | | | — | | | | 88.5 | | |

| | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | |

| | As of | | | | | | |

| Payments for obligations recorded for business combinations | — | | | | — | | | | (76.5 | | ) |

| Balance at October 2, 2015 | 190.3 | | | $ | 47.6 | | | 28.7 | | | $ | (844.6 | ) | | $ | 2,495.2 | | | $ | 1,469.2 | | | $ | (8.2 | ) | | $ | 3,159.2 | |

| Share repurchase program | (8.0 | ) | | (2.0 | | ) | | 8.0 | | | (525.6 | | ) | | 2.0 | | | | — | | | | — | | | | (525.6 | | ) |

1.

2.

BUSINESS COMBINATIONS

The Company uses the acquisition method of accounting for business combinations and recognizes assets acquired and liabilities assumed at their fair values on the date acquired.

Goodwill represents the excess of the purchase price over the fair value of the net assets.

The fair values of the assets and liabilities acquired are determined based upon the Company’s valuation using a combination of market, income or cost approaches.

The valuation involves making significant estimates and assumptions, which are based on detailed financial models including the projection of future cash flows, the weighted average cost of capital and any cost savings that are expected to be derived in the future from the viewpoint of a market participant.

The funded status of benefit pension plans, or the balance of plan assets and benefit obligations, is recognized on the consolidated balance sheet and pension liability adjustments, net of tax, are recorded in Accumulated Other Comprehensive Income.

The Company determines discount rates considering the rates of return on high-quality fixed income investments, and the expected long-term rate of return on pension plan assets by considering the current and expected asset allocations, as well as historical and expected returns on various categories of plan assets.

Decreases in discount rates lead to increases in benefit obligations that, in turn, could lead to an increase in amortization cost through amortization of actuarial gain or loss.

A decline in the market values of plan assets will generally result in a lower expected rate of return, which would result in an increase of future retirement benefit costs.

Revenue from product sales is recognized when there is persuasive evidence of an arrangement, the price to the buyer is fixed and determinable, delivery and transfer of title have occurred in accordance with the shipping terms specified in the arrangement with the customer and collectability is reasonably assured.

Revenue from license fees and intellectual property is recognized when due and payable, and all other criteria previously noted have been met.

The Company ships product on consignment to certain customers and only recognizes revenue when the customer notifies the Company that the inventory has been consumed.

Revenue recognition is deferred in all instances where the earnings process is incomplete.

Certain product sales are made to electronic component distributors under agreements allowing for price protection and stock rotation on unsold products.

Reserves for sales returns and allowances are recorded based on historical experience or pursuant to contractual arrangements necessitating revenue reserves.

Reserves for sales returns and allowances of $32.2 million and $14.7 million were recorded as of September 28, 2018 and September 29, 2017, respectively.

For certain foreign entities that utilize local currencies as their functional currency, the resulting unrealized translation gains and losses are reported as currency translation adjustment through other comprehensive income (loss) for each period.

In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-09, Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), which is intended to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows.

As a result of adoption, the Company recognized a discrete income tax benefit of $25.6 million to the income tax provision for excess tax benefits generated by the settlement of share-based awards during fiscal 2018.

The adoption also resulted in an increase in cash flow from operations and a decrease of cash flow from financing of $25.6 million during fiscal 2018.

Prior periods have not been adjusted.

The Company has elected to account for forfeitures as they occur and will no longer estimate future forfeitures.

The change in accounting for forfeitures was applied using a modified retrospective transition method and resulted in a cumulative-effect adjustment to retained earnings as of the beginning of the first quarter of fiscal 2018 in the amount of $1.9 million.

Forfeitures in the future will now be recorded as a benefit in the period they are realized.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”).

This ASU simplifies the subsequent measurement of goodwill and eliminates Step 2 from the goodwill impairment test.

The annual or interim goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount, and an impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit.

In addition, income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit should be considered when measuring the goodwill impairment loss, if applicable.

The new guidance is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application.

[removed: None.][added: *None.*]

[removed: Evaluation] [added: *Evaluation] of disclosure controls and [removed: procedures.][added: procedures.*]

Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures as of September [removed: 28, 2018.][added: 27, 2019.]

Based on management’s evaluation of our disclosure controls and procedures as of September [removed: 28, 2018,] [added: 27, 2019,] our chief executive officer and chief financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

[removed: Management’s] [added: Management’s] Annual Report on Internal Control over Financial [removed: Reporting][added: Reporting]

The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as of September [removed: 28, 2018.][added: 27, 2019.]

Based on their assessment, management concluded that, as of September [removed: 28, 2018,] [added: 27, 2019,] the Company’s internal control over financial reporting is effective based on those criteria.

[removed: Changes] [added: *Changes] in internal control over financial [removed: reporting.][added: reporting.*]

There are no changes to our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during the [removed: period covered by this report] [added: fourth quarter of 2019] that have materially affected or are reasonably likely to materially affect, our internal control over financial reporting.

[removed: PART III][added: PART III]

Effective as of November 19, 2019, Peter L.

Gammel will retire from his position as Chief Technology Officer of the Company.

None.

The information under the captions “Directors and Executive Officers”, “Corporate Governance─Committees of the Board of Directors” and “Other Matters─Section 16(a) Beneficial Ownership Reporting Compliance” in our definitive proxy statement for the [removed: 2019] [added: 2020] Annual Meeting of Stockholders is incorporated herein by reference.

The information to be included under the caption “Information about Executive and Director Compensation” in our definitive proxy statement for the [removed: 2019] [added: 2020] Annual Meeting of Stockholders is incorporated herein by reference.

The information to be included under the captions “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plan Information” in our definitive proxy statement for the [removed: 2019] [added: 2020] Annual Meeting of Stockholders is incorporated herein by reference.

The information to be included under the captions “Certain Relationships and Related Transactions” and “Corporate Governance─Director Independence” in our definitive proxy statement for the [removed: 2019] [added: 2020] Annual Meeting of Stockholders is incorporated herein by reference.

The information to be included under the caption “Ratification of Independent Registered Public Accounting Firm—Audit Fees” in our definitive proxy statement for the [removed: 2019] [added: 2020] Annual Meeting of Stockholders is incorporated herein by reference.

[removed: PART IV][added: PART IV]

| Report of Independent Registered Public Accounting Firm | | Page [removed: [34](#s88AB469818E21EE7CE22B460410D3659)] [added: [33](#sA72E2E9684C35B3E8BA6F3DF807D7B9C)] |

| Consolidated Statements of Operations for the three years ended September [removed: 28, 2018] [added: 27, 2019] | | Page [removed: [36](#s13EE88FA0C64602A1FC3B4602D08A910)] [added: [35](#sF5797D1334995F7CBB37D3A0B7198D82)] |

| Consolidated Statements of Comprehensive Income for the three years ended September [removed: 28, 2018] [added: 27, 2019] | | Page [removed: [38](#s9E8D64E2696CC271273BB4602D364211)] [added: [38](#s25669B8FAE765B609290E3C6C83874D8)] |

| Consolidated Balance Sheets at September [removed: 28, 2018,] [added: 27, 2019,] and September [removed: 29, 2017] [added: 28, 2018] | | Page [removed: [38](#s9B2605B3F8C0D03A0600B4602D487328)] [added: [37](#s9587151A8B9B5D2A85DB2AC2A3667EFA)] |

| Consolidated Statements of Cash Flows for the three years ended September [removed: 28, 2018] [added: 27, 2019] | | Page [removed: [39](#sE521504A6E010AADE194B4602D87D04F)] [added: [38](#s01CFC479576B5511A7DCD8056A94F32B)] |

| Consolidated Statements of Stockholders’ Equity for the three years ended September [removed: 28, 2018] [added: 27, 2019] | | Page [removed: [40](#s49805281E59A87302F8CB4602DCA5122)] [added: [39](#s7215CF68D32D592A85B32993306773D4)] |

| Notes to Consolidated Financial Statements | | Pages [removed: [41](#s4B214CAEA8C47925433AB460425A2061)] [added: [40](#sBCAA503586C75579B8D62BD65BD83FF8)] through [removed: [62](#s47916B9213DB6A4C265DB46030CC482E)] [added: [57](#sEF07D26D464658DE9BA19DA3C2BC236C)] |

[removed: EXHIBIT INDEX][added: EXHIBIT INDEX]

| [removed: Exhibit Number] [added: Exhibit Number] | [removed: Exhibit Description] [added: Exhibit Description] | [removed: Form] [added: Form] | [removed: Incorporated] [added: Incorporated] by [removed: Reference] [added: Reference] | | | [removed: Filed Herewith] [added: Filed Herewith] |

| [removed: File No.] [added: File No.] | [removed: Exhibit] [added: Exhibit] | [removed: Filing Date] [added: Filing Date] | | | | |

| [removed: 2.3] [added: 2.1] | [Agreement and Plan of Merger dated as of August 3, 2018, by and among the Company, Avnera Corporation, AI Acquisition Corp., and Shareholder Representative Services LLC, solely in its capacity as the representative and agent of the [removed: Equityholders](https://www.sec.gov/Archives/edgar/data/4127/000000412718000046/exhibit23-mergeragreement.htm)] [added: Equityholders](http://www.sec.gov/Archives/edgar/data/4127/000000412718000046/exhibit23-mergeragreement.htm)] | [added: 10-K] | [added: 001-05560] | [added: 2.3] | [added: 11/15/2018] | [removed: X] |

| [removed: 10.2*] [added: 10.8*] | [Skyworks Solutions, Inc. [removed: 1999 Employee] [added: 2015] Long-Term Incentive [removed: Plan](http://www.sec.gov/Archives/edgar/data/4127/000095013502005681/b45002ssexv10wl.txt)] [added: Plan, as Amended](http://www.sec.gov/Archives/edgar/data/4127/000000412719000041/q319exhibit101.htm)] | [removed: 10-K] [added: 10-Q] | 001-05560 | [removed: 10.L] [added: 10.1] | [removed: 12/23/2002] [added: 8/7/2019] | |

| [removed: 10.3*] [added: 10.1*] | [Skyworks Solutions, Inc. 2002 Employee Stock Purchase Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412713000006/amendedqualifiedesppplanex.htm) | 10-Q | 001-05560 | 10.D | 1/31/2013 | |

| [removed: 10.4*] [added: 10.2*] | [Skyworks Solutions, Inc. Non-Qualified Employee Stock Purchase Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412713000006/amendednon-qualifiedespppl.htm) | 10-Q | 001-05560 | 10.E | 1/31/2013 | |

| [removed: 10.5*] [added: 10.3*] | [Skyworks Solutions, Inc. Amended and Restated 2005 Long-Term Incentive Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412713000023/fy12proxyvoteexhibit101.htm) | 8-K | 001-05560 | 10.1 | 5/13/2013 | |

| [removed: 10.6*] [added: 10.4*] | [Form of Nonstatutory Stock Option Agreement under the Company’s 2005 Long-Term Incentive Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412713000006/a2005long-termincentiveupd.htm) | 10-Q | 001-05560 | 10.B | 1/31/2013 | |

| [removed: 10.7*] [added: 10.10*] | [Form of Performance Share Agreement under the Company’s [removed: 2005] [added: 2015] Long-Term Incentive [removed: Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412713000006/a2005long-termincentivepla.htm)] [added: Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412715000027/exh103psaagreement.htm)] | 10-Q | 001-05560 | [removed: 10.C] [added: 10.3] | [removed: 1/31/2013] [added: 8/5/2015] | |

| [removed: 10.8*] [added: 10.11*] | [Form of Restricted Stock Unit Agreement under the Company’s [removed: 2005] [added: 2015] Long-Term Incentive [removed: Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412714000020/ex101rsuagreement.htm)] [added: Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412715000027/exh104rsuagreement.htm)] | [removed: 8-K] [added: 10-Q] | 001-05560 | [removed: 10.1] [added: 10.4] | [removed: 5/9/2014] [added: 8/5/2015] | |

| [removed: 10.9*] [added: 10.5*] | [Skyworks Solutions, Inc. Amended and Restated 2008 Director Long-Term Incentive Plan, as Amended](http://www.sec.gov/Archives/edgar/data/4127/000000412718000021/q218exhibit101amendedandre.htm) | 10-Q | 001-05560 | 10.1 | 5/4/2018 | |

| [removed: 10.10*] [added: 10.6*] | [Form of [removed: Restricted] [added: Nonstatutory] Stock [added: Option] Agreement under the Company’s 2008 Director Long-Term Incentive [removed: Plan](http://www.sec.gov/Archives/edgar/data/4127/000089256908000778/a40452exv10wnn.htm)] [added: Plan](http://www.sec.gov/Archives/edgar/data/4127/000089256908000778/a40452exv10woo.htm)] | 10-Q | 001-05560 | [removed: 10.NN] [added: 10.OO] | 5/7/2008 | |

| [removed: 10.11*] [added: 10.9*] | [Form of Nonstatutory Stock Option Agreement under the Company’s [removed: 2008 Director] [added: 2015] Long-Term Incentive [removed: Plan](http://www.sec.gov/Archives/edgar/data/4127/000089256908000778/a40452exv10woo.htm)] [added: Plan](http://www.sec.gov/Archives/edgar/data/4127/000000412715000027/exh102optionagreement.htm)] | 10-Q | 001-05560 | [removed: 10.OO] [added: 10.2] | [removed: 5/7/2008] [added: 8/5/2015] | |