Cristiano Amon, president and CEO of Qualcomm, speaks in the course of the Milken Institute Global Conference on May 2, 2022, in Beverly Hills, Calif.
Patrick T. Fallon | AFP | Getty Images
Qualcomm reported second-quarter earnings on Wednesday that have been consistent with analyst expectations, however sales from handset chips, a core enterprise for the corporate, declined 17% from a yr earlier.
Qualcomm shares fell over 4% in prolonged buying and selling.
Here’s how the chipmaker did versus Refinitiv consensus estimates:
- EPS: $2.15 per share adjusted vs. $2.15 per share anticipated
- Revenue: $9.28 billion vs. $9.1 billion anticipated
Net earnings in the course of the quarter led to March fell 42% to $1.70 billion, or $1.52 per share, from $2.93 billion, or $2.57 per share, within the year-earlier interval, the corporate mentioned.
Qualcomm mentioned it anticipated round $8.5 billion in sales within the present quarter, wanting Wall Street expectations of $9.14 billion. Analysts have been anticipating current-quarter earnings steering of $2.16 per share, however the firm mentioned it might be round $1.80.
Qualcomm CEO Cristiano Amon in a press release blamed the outcomes on a difficult surroundings, and the corporate mentioned it had not seen proof that smartphone sales are recovering in China. The smartphone market is taking a look at a troublesome 2023, with shipments for the worldwide market declining over 14% within the first quarter, according to IDC.
“The evolving macroeconomic backdrop has resulted in additional demand deterioration, significantly in handsets, at a magnitude higher than we beforehand forecasted,” Amon mentioned on a name with analysts.
Total income declined 17% to $9.28 billion from the year-earlier quarter, the chipmaker mentioned.
Qualcomm’s chip section, referred to as QCT, sells smartphone processors, automotive chips and different components for superior electronics. QCT income declined 17% to $7.94 billion in the course of the quarter.
The greatest a part of the section’s income comes from handset chips, that are the processors on the coronary heart of most Android telephones. Qualcomm reported $6.11 billion in handset sales, down 17% from final yr.
The firm mentioned it anticipated a larger-than-normal decline within the third quarter for QTL income, saying it was associated to “the timing of purchases by a modem-only handset buyer.” QTL is the corporate’s licensing section, which sells entry to applied sciences wanted for mobile service.
Qualcomm not often discusses its enterprise with Apple, and did not title the corporate, however Apple does buy modems from the corporate for its iPhones and different units.
“Given the weaker handset forecast, till demand normalizes and visibility improves, we anticipate that prospects will stay cautious with purchases,” Qualcomm finance chief Akash Palkhiwala mentioned on the decision.
The automotive enterprise, which incorporates chips and software program for automobiles, continues to be small, though it confirmed 20% progress in the course of the quarter to $447 million in income.
QTL reported an 18% annual lower in income to $1.29 billion.
Qualcomm mentioned it made $900 million in share repurchases and paid $800 million in dividends in the course of the quarter.