Qualcomm shares dip as guidance disappoints investors
For the quarter ended June 29, Qualcomm reported non-GAAP earnings of $2.77 per share, ahead of the $2.71 consensus forecast. Revenue rose 10% year-over-year to $10.37 billion, slightly exceeding Wall Street's expectation of $10.33 billion.
The company's core chip business, Qualcomm CDMA Technologies (QCT), delivered $8.99 billion in sales, up 11% from a year earlier. Within QCT, handset-related sales grew 7% to $6.33 billion, while automotive revenue hit a record $984 million, up 21% year-over-year, and IoT revenue rose 24% to $1.68 billion.
'Another quarter of strong growth in QCT Automotive and IoT revenues further validates our diversification strategy and confidence in achieving our long-term revenue targets,' said Cristiano Amon, President and CEO of Qualcomm Incorporated. Amon added, 'Our leadership in AI processing, high-performance and low-power computing and advanced connectivity positions us to become the industry platform of choice as AI gains scale at the edge.'
The report underscores Qualcomm's shift toward more diversified markets amid headwinds in its legacy handset segment. Automotive and IoT now collectively represent nearly 30% of QCT sales, with the automotive segment seeing tailwinds from growing adoption of its Snapdragon-based digital cockpits and ADAS platforms.
Despite the solid performance this quarter, investors appeared wary of Qualcomm's upcoming final quarter of fiscal 2025. The company guided Q4 revenue to fall between $10.3 billion and $11.1 billion, in-line with analyst estimates of $10.6 billion at the midpoint; EPS guidance of $2.75 to $2.95 was also relatively in-line with the $2.82 consensus.
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