Qualcomm reported quarterly results Wednesday that beat Wall Street expectations, but the company’s earnings forecast was lighter than expected. Shares fell 7% in extended trading.
Here’s a comparison of chipmaker results and LSEG’s consensus estimates:
EPS: $2.17 adjusted, $2.16 forecast Revenue: Adjusted $10.44 billion
For the current quarter, Qualcomm said it expects earnings per share to be in the range of $2.15 to $2.35 and revenue in the range of $10.4 billion to $11.2 billion. Analysts had expected earnings of $2.27 per share and revenue of $10.48 billion.
Most of Qualcomm’s chip sales come from systems-on-chips and modems for smartphones. The market is currently in turmoil, with rising memory prices forcing mobile phone makers to raise prices and hurting demand. Adjusted corporate earnings were down 7% year over year.
Qualcomm raised prices in September. Still, mobile phone chip sales for the quarter fell 26% to $5.14 billion, below Street estimates of $5.21 billion. Qualcomm said that although it expects the mobile device market to level off in 2027, the category is starting to see gradual growth and that Android shipments in China have bottomed out.
Under CEO Cristiano Amon, Qualcomm has been trying to focus investors’ attention on other types of chips. The company aims to tap into the fast-growing market for AI data center infrastructure. Data center revenue for the quarter was $650 million, mostly from customization and connectivity work, Amon said.
Amon said Qualcomm expects data center revenue to be $5 billion in fiscal 2027. The company said it recently signed optical connectivity customers and partnered with a global hyperscaler.
“It’s not a demand issue. It’s a supply issue,” Amon said. “If we had more supply, we probably could have done better.”
Qualcomm also sells chips for cars and other automotive applications. The division’s revenue rose 89% for the year to $1.99 billion, beating Street estimates of $1.66 billion.
Internet of Things revenues include the company’s efforts to provide low-power chips, smart glasses SoCs, laptop chips, and cellular infrastructure. Earlier Wednesday, Qualcomm announced a deal to provide the technology. space x Cellular Augmentation. IoT sales increased 4% year over year to $1.88 billion, slightly exceeding expectations.
Qualcomm’s QTL segment includes revenue from licensing intellectual property in 5G and other technologies to other companies. During the quarter, Qualcomm announced that it renewed license agreements with Apple, Huawei, and Transsion.
“QTL will continue to scale,” Amon said.
QTL’s revenue fell 7% to $1.3 billion, in line with Street estimates.
Spotlight: SpaceX signs deal with Qualcomm
