Qualcomm revenue exceeded expectations, in the mobile direction it grew by 12%

American mobile processor developer Qualcomm this week reported results for its third fiscal quarter. The results of the period exceeded analysts’ expectations in many respects, and in the mobile processors segment, revenue increased by 12% to $5.9 billion, meeting investor forecasts.

Image source: Qualcomm Technologies

At the very least, as CNBC explains, this coincidence alone allows us to hope that the decline in demand for smartphones that has been observed for the previous two years is coming to an end. It is important to take into account that the summer months are traditionally characterized by low activity in the smartphone market. At the end of the year, as Qualcomm representatives admit, the number of smartphones sold on the global market will remain at last year’s level. At best, supply growth will be a single-digit percentage increase.

Qualcomm’s total revenue in the last quarter grew by 11% to $9.39 billion, which was higher than the $9.21 billion expected by analysts. In the smartphone segment, the company’s revenue grew by 12% to $5.9 billion. The automotive segment cannot yet boast of a high share of in Qualcomm’s total revenue, but it increased 87% to $811 million. The company’s efforts to reduce dependence on the smartphone market have so far shown only limited success. The company’s net profit year-on-year increased by 18% to $2.13 billion.

For the current quarter, Qualcomm expects revenue of $9.5 billion to $10.3 billion, which is in the middle of the range above the $9.71 billion projected by investors. As the company’s management explains, “AI has expanded the boundaries of the premium segment” in the smartphone market. Even if overall smartphone sales grow by a few percent, the premium segment will grow at a faster pace, and Qualcomm has already made sure of this.

The Internet of Things business, which includes components for virtual and augmented reality headsets, showed a revenue decline of 8% to $1.4 billion last quarter. In any case, this amount was more than twice as high as investors’ expectations. In total, sales of hardware components brought Qualcomm $8.1 billion in the last quarter, which is 12% more than the same period last year. Technology licensing increased the core portion of the company’s revenue by 3% to $1.3 billion. The revocation of the export license, which previously allowed Qualcomm to supply chips for Huawei’s needs, will negatively affect the company’s revenue dynamics. Qualcomm paid out $949 million in dividends last quarter and spent $1.3 billion on share repurchases. By the close of trading, their rate had grown by 8.39%, but then decreased by 1.22%.