Qualcomm forecasts beast estimates, shares rise (updated)

United Microelectronics

01/11/2023 20:06

(Adds share move in paragraph 3, results for chip segments in
paragraphs 9-10)
    By Stephen Nellis and Chavi Mehta
       Nov 1 (Reuters) - Chip designer Qualcomm  QCOM.O 
forecast first-quarter sales and profits above Wall Street
targets on Wednesday as a smartphone sales slump finally starts
to ease and a renewed contract with Apple  AAPL.O  helps boost
its outlook.
    The San Diego, California-based company forecast
current-quarter revenue of $9.1 billion to $9.9 billion, with a
midpoint above analysts' expectations of $9.2 billion according
to LSEG data. Qualcomm predicted current-quarter adjusted
profits of $2.25 to $2.45 per share, beating expectations of
$2.23 according to LSEG.
    Qualcomm shares rose 3% after the results were released.
    For the just-ended fiscal fourth quarter, Qualcomm reported
sales of $8.67 billion and adjusted profits of $2.02 per share,
both above analysts' estimates of $8.51 billion and $1.91 per
share, according to LSEG data.
    Chipmakers have been grappling with a smartphone market
slump. Qualcomm is also facing new competition from Huawei
Technologies  HWT.UL , which has resumed producing its own
smartphone chips after relying on the U.S. company for the past
several years.
    Analysts also expect major Qualcomm customer Samsung
Electronics  005930.KS  to resume using some of its own in-house
chips after using all Qualcomm chips in its most recent devices.
    But Qualcomm is also making advances, saying in September it
signed a fresh supply agreement with iPhone maker Apple  AAPL.O 
that runs to 2026. Last week it disclosed plans for a renewed
push into the laptop market with backing from Microsoft
 MSFT.O .
    Fourth-quarter sales in Qualcomm's chip unit were $7.4
billion, beating analysts' estimate of $7.26 billion according
to FactSet data. In Qualcomm's intellectual property licensing
business, sales of $1.26 billion were in line with estimates of
$1.25 billion according to FactSet data.
    In its chip business, Qualcomm said fourth-quarter revenue
from smartphone handsets was $5.46 billion, beating analysts'
expectations of $5.34 billion according to FactSet data.
        Automotive chip sales were $535 million in the fourth
quarter, above estimates of $482 million according to FactSet.
Overall, Qualcomm said its automotive chip business was up 24%
for fiscal 2023 at $1.9 billion. 
  

 (Reporting by Chavi Mehta in Bengaluru and Stephen Nellis in
San Francisco; Editing by Richard Chang)
 ((Chavi.Mehta@thomsonreuters.com;))