Qualcomm CEO Cristiano Amon speaks on the Computex discussion board in Taipei, Taiwan, June 3, 2024.
Ann Wang | Reuters
Qualcomm reported better-than-expected fiscal first-quarter outcomes Wednesday and issued sturdy steerage for the present interval.
Here is how the chipmaker did versus LSEG consensus estimates for the quarter ending Dec. 29:
- Earnings per share: $3.41, adjusted, vs. $2.96 anticipated
- Income: $11.67 billion vs. $10.93 billion anticipated
Income within the quarter rose 18% from $9.92 billion a 12 months in the past. Shares fell in prolonged buying and selling.
For the March quarter, Qualcomm stated it expects income of between $10.2 billion and $11 billion, which at its midpoint tops LSEG expectations of $10.34 billion. The corporate expects adjusted earnings of between $2.70 and $2.90 a share. The center of the vary is greater than Wall Avenue’s estimate of $2.69 per share.
Qualcomm stated internet earnings elevated 15% to $3.18 billion, or $2.83 per share, from $2.77 billion, or $2.46 per share, a 12 months earlier.
The corporate’s adjusted earnings determine excluded gadgets resembling anticipated income ensuing from the settlement of a dispute, acquisition-related gadgets, in addition to analysis and improvement expenditures.
All three of Qualcomm’s main finish markets for its chips grew through the quarter. Its QCT division, which incorporates gross sales from bodily chips, rose 20% to $10.1 billion.
An important marketplace for Qualcomm is cellular handsets, which grew 13% on an annual foundation to $7.57 billion in gross sales. Analysts polled by FactSet had been in search of $7.04 billion in handset gross sales, or about 5% progress.
The fastest-growing marketplace for Qualcomm is its automotive enterprise, which grew 61% to $961 million in gross sales, as long-term contracts for the corporate’s elements and software program flip into recorded income.
Qualcomm noticed large demand from prospects in China for costly “premium-tier” smartphones, CEO Cristiano Amon advised CNBC’s Kristina Partsinevelos. The corporate additionally benefited from Samsung’s newest Galaxy machine utilizing Qualcomm processors solely. Qualcomm stated it anticipated handset revenues to develop 10% in 2025.
Amon stated on a name with analysts that the corporate believes the latest launch of the DeepSeek R1 AI mannequin is sweet for Qualcomm, as a result of its chips can run the environment friendly mannequin domestically, as a substitute of within the cloud.
“DeepSeek R1 and different related fashions not too long ago demonstrated that AI fashions are growing quicker, turning into smaller, extra succesful and environment friendly, and now in a position to run immediately on machine,” Amon stated.
Qualcomm’s Web of Issues, or IoT, enterprise consists of low-power chips for industrial functions in addition to the chips Qualcomm sells to Meta to energy its Quest headsets and Ray-Ban-branded Meta good glasses. It additionally consists of gross sales of Snapdragon Elite chips for Home windows laptops. The primary Qualcomm laptop computer chips had been launched in 2024, and Qualcomm stated Wednesday that it had 10% market share in laptops over $800.
Income within the firm’s IoT enterprise grew 36% through the quarter to $1.55 billion.
“The Snapdragon-based Ray-Ban Meta glasses proceed to exceed expectations as they undertake extra AI options,” Amon stated. “We stay optimistic that we’re at first of an inflection level for good glasses to realize scale as they develop into wearable.”
Qualcomm additionally has a licensing enterprise, referred to as QTL, the place different expertise corporations pay it for entry to its mental property associated to 5G and mobile expertise. Qualcomm reported $1.54 billion in gross sales within the division. It stated it had signed notable Chinese language smartphone maker Transsion to a 4G license, in addition to finalized negotiations for long-term licenses with two different Chinese language producers.
“We stay more than happy with the execution of our QTL enterprise in recent times, and we’re properly positioned to keep up fiscal ’24 income scale going ahead,” Amon stated on the decision.
Qualcomm stated it paid $942 million in dividends and spent $1.8 billion on share repurchases through the quarter.
