Qualcomm Inc. delivered a strong outlook for the fiscal second quarter as smartphone chip sales soared in the holiday period.
In the company’s latest guidance, the estimated adjusted earnings were between $2.80 to $3.00 per share. The projection edged up from the average analysts’ estimate of $2.51.
Consequently, the world’s largest chipmaker forecasted a revenue of $10.20 billion to $11.00 billion, surpassing the $9.66 billion consensus.
The firm also expected CDMA technologies (QCT) sales to be at $8.70 billion to $9.30 billion. It significantly outpaced the estimated figure of $8.05 billion.
Accordingly, the QCT segment includes handset and RF chips and processors for vehicles and the Internet of Things.
At the same time, it anticipated sales of Qualcomm’s technology licensing (QTL) to report at $1.45 billion to $1.65 billion. Meanwhile, the market forecasted a revenue of $1.58 billion.
In the earnings call, Qualcomm CEO Cristiano Amon said that demand remains strong across all its segments.
Despite the global shortage of microchips, Amon added that supply would improve in the second half of the year.
Qualcomm Reports Upbeat Q1 Earnings
Moreover, Qualcomm released its latest outlook and first-quarter earnings that have beaten expectations.
Its earnings climbed 49.00% year-over-year to $3.23 per share, surpassing the expected $3.01.
The total revenue for the holiday quarter edged up to $10.71 billion from $8.24 billion a year ago. It also elevated from the forecasted figure of $10.44 billion.
Subsequently, its QTC segment posted an annual increase of 35.00% to $8.85 billion, above the estimated $8.69 billion.
The strong sales for handset chips fueled the upturn, making up for lower-than-expected sales of other products.
Smartphone chip sales strengthened 42.00% year-over-year to $5.98 billion, above the expected $5.53 billion.
Correspondingly, Qualcomm mentioned that its Snapdragon chipsets’ annual growth was 60.00%. It is the heart of Android phones that combine processing and 5G connectivity.
In the first quarter, the firm prioritized sales to phone makers in China at the expense of other categories.
Eventually, RF front-end sales, the division on wireless connectivity, declined to $1.13 billion versus the projected $1.27 billion.
Likewise, auto chip sales jumped to $256.00 million but fell short of Wall Street’s $275.90 million.
Consequently, Internet of Things (IoT) sales were at $1.48 billion, lower than the $1.57 billion consensus.
In line with this, Qualcomm shares slipped 3.03% or 5.70 points to $182.50 on Wednesday extended trading.
