Qualcomm (QCOM) earnings report Q1 2024

Qualcomm reported fiscal first-quarter outcomes on Wednesday that topped analysts’ estimates as gross sales of handset chips jumped 16% from a yr earlier. Qualcomm shares fell greater than 1% in prolonged buying and selling.

This is how the chipmaker did for the quarter ending Dec. 24, per consensus expectations from LSEG, previously generally known as Refinitiv:

• Earnings per share: $2.75 adjusted vs. $2.37 anticipated
• Income: $9.92 billion adjusted vs. $9.51 billion anticipated

For the present quarter, Qualcomm mentioned it expects adjusted earnings of between $1.73 and $1.93 per share on income of $8.9 billion to $9.7 billion. Consensus expectations, in response to LSEG, had been for earnings of $2.25 per share on $9.3 billion of income.

Web earnings rose 24% throughout the quarter to $2.77 billion, or $2.48 per share, from $2.24 billion, or $1.98 per share, a year in the past.

Qualcomm is greatest identified for making smartphone chips — each the modems that join them to mobile networks, in addition to the processors on the coronary heart of high-end Android gadgets.

Beneath CEO Cristiano Amon, Qualcomm has been working to use its chip know-how to markets past smartphones, together with PCs, automobiles and digital actuality headsets. But it surely’s nonetheless a serious smartphone provider as the worldwide market has slumped over the previous two years.

Qualcomm mentioned it shipped $6.69 billion in handset chips throughout the December quarter, up 16% yr over yr, a constructive signal for the smartphone market after two years of declines. Qualcomm mentioned it anticipated international handset gross sales could be flat yr over yr.

“We see the Android market stabilizing after we’ve been through 2023,” Amon mentioned. “That was a year of correction.”

Notably, Samsung’s high-end Galaxy telephones launched in January use Qualcomm processors, and the corporate expects that enterprise to proceed for a number of years beneath a brand new deal, foreclosing the chance that the second-largest smartphone maker would eschew Qualcomm for its personal chips.

Qualcomm’s Web of Issues enterprise consists of the chips Meta makes use of in its digital actuality headsets. That phase noticed gross sales slide 32% to $1.13 billion.

Qualcomm is betting closely on promoting chips to automakers and automotive suppliers, however it’s a course of that can take years as automotive components have a protracted “qualification” cycle resulting from rules and the wants of the trade. Qualcomm’s nascent automotive enterprise, a part of QCT, reported $589 million in gross sales, up 31% on an annual foundation.

QCT, the corporate’s chip gross sales enterprise that features automotive, Web of Issues and handsets, totaled $8.42 billion in income throughout the quarter, up 7% on an annual foundation.

The corporate’s worthwhile licensing enterprise, QTL, reported $1.46 billion in income, a 4% annual decline. Amon informed analysts on a name that Apple had agreed to increase its patent licensing settlement by means of March 2027.

Qualcomm mentioned it spent $800 million in share repurchases and $900 million on dividends throughout the quarter.