Activist investor Starboard Value has acquired a 7.7% stake in chipmaker Qorvo, potentially signalling the start of efforts by the hedge fund to push for improvements at the company, which saw a 37% decline in its share price last year, according to a report by Reuters.
The report cites a filing made by the company on Friday as confirming the move, which prompted an increase of over 8% in the value of Qorvo’s stock in premarket trading.
Qorvo, a key supplier to Apple, has been facing increasing competition and a slowdown in orders for its smartphone chips. This comes as consumers lean towards entry-level smartphones, while larger rivals such as Broadcom and Qualcomm have benefited from a recovery in the Chinese smartphone market.
In October, Qorvo warned that the shift away from mid-tier 5G Android smartphones would negatively impact its revenue in the latter half of fiscal 2025. The company is also expected to report a 16% decline in third-quarter revenue, according to data from LSEG.
Starboard’s investment in Qorvo is valued at more than $500m, based on the stock’s closing price on Thursday.
Led by Jeffrey Smith, Starboard Value is one of the most prominent activist hedge funds, known for pushing for strategic changes at companies such as Pfizer and Salesforce.
Qorvo’s stock fell more than 37% in the past year, underperforming its industry peers. Contributing to the decline was a weaker economy and slower-than-expected adoption of artificial intelligence, which has been a key growth driver for many chipmakers.
Additionally, Qorvo was removed from the S&P 500 index in December, further adding to investor concerns.
