Qualcomm Reports Higher Revenue, Issues Mixed Outlook
February 05 2020 - 5:12PM
Dow Jones News
By Asa Fitch
Qualcomm Inc. reported higher fiscal first-quarter revenue,
bolstered by a strong performance in its technology-licensing arm,
but its bottom line suffered absent a one-time boost in the
year-ago period.
The San Diego-based company, which designs and markets
semiconductors mostly for mobile-communications equipment, on
Wednesday said sales were $5.08 billion during the quarter ended in
December, up 5% compared with the same period the year prior.
Adjusted earnings per share fell 18% to 99 cents, higher than
what Wall Street expected based on analysts surveyed by FactSet.
Profit in the previous year's first quarter was helped by an
adjusted $552 million benefit from U.S. tax reforms passed in
2017.
Like its peers in the cellphone supply chain, Qualcomm grappled
with lower global smartphone sales last year. Many consumers are
waiting to purchase new handsets to take advantage of superfast
fifth-generation cell networks that operators are building out.
But Chief Executive Steve Mollenkopf said Qualcomm was reaping
early gains from the rollout of the new networks. "Our strong
fiscal first-quarter financial performance reflects a significant
inflection point for Qualcomm," he said.
Qualcomm also benefited during the last three months of 2019
from bumper sales of Apple Inc.'s latest iPhones. The company
collects royalties from patents it licenses Apple and other handset
maker. Qualcomm's licensing arm generated $1.4 billion in sales in
the quarter, up by 38% compared with a year ago, even as its chip
division sales fell 3% year-over-year.
The chip maker issued a mixed outlook for the current quarter.
Chip shipments could fall to between 125 million and 145 million,
from 155 million in the first quarter. Qualcomm said sales should
be $4.9 billion to $5.7 billion, compared with Wall Street
expectations of $5.1 billion.
Shares in the company rose around 1% in after-hours trading.
Write to Asa Fitch at asa.fitch@wsj.com
(END) Dow Jones Newswires
February 05, 2020 16:57 ET (21:57 GMT)
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