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Qualcomm projects strong revenue, warns of trade-curb influence
Chipmaker Qualcomm forecast fourth-quarter revenue above Wall Street estimates, with a revenue range with a midpoint of $9.9 billion, higher than analysts’ average estimate of $9.71 billion.
Headline
Chipmaker Qualcomm forecast fourth-quarter revenue above Wall Street estimates, with a revenue range with a midpoint of $9.9 billion, higher than analysts’ average estimate of $9.71 billion.
Context
OUR TAKE Qualcomm’s upbeat forecast underscores the robust demand for high-end Android devices and AI-enhanced smartphones. Despite US-China trade tensions and the Huawei licence revocation, the company’s diversified business strategy, including automotive and IoT sectors, positions it well for sustained growth. –Vicky Wu, BTW reporter Chipmaker Qualcomm forecast fourth-quarter revenue above Wall Street estimates, betting on strong demand for high-end Android devices and the need for more chips in smartphones that are receiving AI upgrades. Shares initially rose more than 5% in extended trading after the results were announced, but pared gains to trade down 1.4% after the firm flagged a revenue hit from the US revoking one of its export licences for sanctioned Chinese telecom firm Huawei Technologies.
Evidence
Pending intelligence enrichment.
Analysis
Qualcomm’s forecast for the fourth quarter includes a revenue range with a midpoint of $9.9 billion, higher than analysts’ average estimate of $9.71 billion. The company also forecasts a fiscal fourth-quarter sales range for its core segment that sells chips to customers, with a midpoint of $8.4billion, compared with Visible Alpha estimates of $8.33 billion. For its patent-licensing segment, the forecasted fourth-quarter sales range has a midpoint of $1.45 billion, higher than analysts’ estimates of $1.37 billion. Qualcomm’s mobile handset revenue grew 12% to $5.9 billion in the third quarter, while automotive revenue surged 87% to $811 million. Internet-of-Things (IoT) chip revenues fell 8% to $1.36 billion. The company’s entry into the automotive market is part of a strategy to reduce dependence on the smartphone market and diversify its business. Also read: Qualcomm’s new chip brings 5G to budget phones under $100 Also read: Ampere Computing pairs with Qualcomm on AI chips
Key Points
- Chipmaker Qualcomm forecast fourth-quarter revenue above Wall Street estimates, with a revenue range with a midpoint of $9.9 billion, higher than analysts’ average estimate of $9.71 billion.
- This optimistic forecast is based on strong demand for high-end Android devices and AI-upgraded smartphones, despite a revenue hit due to the US revoking an export licence for Huawei Technologies.
Actions
Pending intelligence enrichment.
