Skyworks and Qorvo to Merge in $22 Billion Semiconductor Deal
The combination creates a U.S. radio-frequency chip leader to challenge Broadcom amid surging 5G and IoT demand.
Skyworks Solutions and Qorvo announced a definitive agreement on Tuesday to combine, forging a new U.S. leader in the critical radio-frequency and analog semiconductor market in a deal that values the new entity at approximately $22 billion.
The merger marks one of the most significant consolidations in the semiconductor industry this year, creating a scaled competitor aimed at challenging larger rivals like Broadcom and Qualcomm. The move combines two key suppliers for high-performance chips that are essential components in everything from smartphones and 5G infrastructure to connected vehicles and defense systems.
According to the official announcement, the combined company is expected to generate $7.7 billion in revenue and $2.1 billion in adjusted EBITDA. Leadership projects the deal will be immediately accretive to non-GAAP earnings per share and yield over $500 million in annual cost synergies within three years of closing.
Prior to the announcement, Skyworks (NASDAQ: SWKS) had a market capitalization of approximately $11 billion, while Qorvo (NASDAQ: QRVO) was valued at over $8.4 billion. The deal signals a strategic push for scale in a capital-intensive industry where thinning margins and slowing smartphone sales have increased pressure on mid-sized players.
This strategic combination is unfolding against a backdrop of surging demand in markets beyond mobile phones. The global RF semiconductor market is projected to grow to over $50 billion by 2032, according to an analysis from Fortune Business Insights, fueled by the expansion of 5G networks, the Internet of Things (IoT), and advanced automotive applications. By joining forces, Skyworks and Qorvo can pool research and development resources and offer a more comprehensive product portfolio to capture this growth.
The new entity will be structured to address these opportunities, with a $5.1 billion mobile-focused business and a $2.6 billion division targeting diversified markets, including aerospace, AI data centers, and automotive. This structure positions the company to better compete for high-value contracts and reduce its reliance on the cyclical smartphone market.
"This combination creates a U.S.-based leader with the scale, technology, and talent to deliver innovative solutions for our customers," the companies stated in their joint release. Phil Brace is set to lead the combined company as Chief Executive Officer.
However, the merger is expected to face close regulatory scrutiny in the U.S. and abroad, where antitrust regulators have taken a more aggressive stance on consolidation within the technology sector. The deal's success will ultimately hinge on securing those approvals and executing a complex integration of two established industry players.