The London Company Mid Cap Portfolio Sold Skyworks Solutions (SWKS) in Q2. Here's Why

The London Company, an investment management company, released “The London Company Mid Cap Strategy” second quarter 2025 investor letter. A copy of the letter can be downloaded here. US equities saw a double-digit surge in the second quarter following a sharp decline in the first quarter. The mid-cap composite rose 5.7% (5.5% net) in the second quarter, falling short of the Russell Midcap Index’s 8.5% increase. Please review the fund's top 5 holdings to gain insight into their key selections for 2025.

In its second quarter 2025 investor letter, The London Company Mid Cap Strategy highlighted stocks such as Skyworks Solutions, Inc. (NASDAQ:SWKS). Headquartered in Irvine, California, Skyworks Solutions, Inc. (NASDAQ:SWKS) designs, develops, and manufactures semiconductor products. The one-month return of Skyworks Solutions, Inc. (NASDAQ:SWKS) was -7.98%, and its shares lost 36.68% of their value over the last 52 weeks. On July 29, 2025, Skyworks Solutions, Inc. (NASDAQ:SWKS) stock closed at $71.94 per share, with a market capitalization of $10.8 billion.

The London Company Mid Cap Strategy stated the following regarding Skyworks Solutions, Inc. (NASDAQ:SWKS) in its second quarter 2025 investor letter:

"Exited: Skyworks Solutions, Inc. (NASDAQ:SWKS) – Sold remaining position reflecting greater competition, client concentration, and recent management changes. We first purchased SWKS in late 2018. Shares of SWKS did well in the early years of our holding period, but the stock underperformed the broader market in recent years. While it is frustrating to sell on weakness, the recent loss of exclusivity on an iPhone 17 component with Apple highlights a significant risk to the firm. Apple represents over 60% of revenue to SWKS, so any change in the relationship is meaningful. This is the second loss of a component used in iPhones in recent years and is a sign of greater competition from large players like Qualcomm and Broadcom. SWKS also recently fired their CEO, which is another risk in the future. We decided to sell based on these concerns."

Skyworks Solutions, Inc. (NASDAQ:SWKS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 31 hedge fund portfolios held Skyworks Solutions, Inc. (NASDAQ:SWKS) at the end of the first quarter, which was 31 in the previous quarter. While we acknowledge the potential of Skyworks Solutions, Inc. (NASDAQ:SWKS) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Skyworks Solutions, Inc. (NASDAQ:SWKS) and shared the list of most oversold semiconductor stocks so far in 2025. Skyworks Solutions, Inc. (NASDAQ:SWKS) detracted from The London Company Mid Cap Strategy's performance in Q1 2025 due to a major shift in its relationship with Apple. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.