26.6 C
Monday, September 20, 2021

Qualcomm: Qualcomm forecasts strong Q1 as Apple, others ramp up 5G phones – Latest News

Must read

Qualcomm Inc forecast fiscal first-quarter revenue above Wall Street estimates as it predicted sales of 5G smart phones would balloon to more than half a billion units next year, powered in part by new Apple Inc iPhone 12 models.

Qualcomm’s shares were up 14% in extended trading.

The San Diego-based company is the biggest supplier of processors for smartphones and modem chips that connect phones to wireless data networks. It has invested heavily in developing lucrative 5G technology hoping to profit as it becomes mainstream in mobile phones, a trend poised to ramp up with the introduction of Apple’s first 5G phones last month.

Revenue from the company’s chip segment, its largest by sales, was $4.97 billion in the fiscal fourth quarter, compared with FactSet estimates of $4.59 billion.

Qualcomm this year returned to being a major supplier for Apple, supplying chips that help the new iPhone 12 models connect to high-speed 5G networks. Apple did not give a forecast for its sales during the current quarter, making Qualcomm’s chip sales one of the few proxies for investors to gauge the progress of the new iPhones.

But Qualcomm is supplying a broad swath of phone makers beyond Apple with 5G chips, which is driving revenue and profit growth. Apple’s iPhone’s launched a month later than usual, and, though he did not name Apple, Qualcomm Chief Executive Steve Mollenkopf told Reuters in an interview that the contribution from new customer in the quarter was small.

“The results we just printed really include a smaller impact than you would normally see with one of the new customers that we’re ramping up, just due to timing of their launch,” he said.

Apple shares rose 0.6% after the announcement of Qualcomm’s results.

Qualcomm said it shipped 162 million chips capable of wireless data connections during its fiscal fourth quarter, compared with FactSet estimates of 155.3 million.

Based on the shipments, the average selling price for chips was $30.9, higher than $29.3 in the previous quarter. That is in part because Qualcomm is increasingly paring its modem and processor chips with radio chips that drive up selling prices. Sales of those radio chips nearly doubled from the prior quarter to $852 million in the fourth quarter, helping drive adjusted earnings per share of $1.45 versus estimate of $1.17, according to Refinitiv data.

“This is really the 5G story showing up in a big way in our business,” Mollenkopf said.

Qualcomm expects chip segment revenue in the range of $6.2 billion to $6.8 billion for the unit during the first quarter, ahead of FactSet estimates of $5.71 billion.

Qualcomm, which makes the bulk of profits from its licensing business, said revenue from the unit was $1.51 billion, above FactSet estimates of $1.30 billion.

The company said it expects overall current-quarter revenue of between $7.8 billion and $8.6 billion, compared with analysts’ estimates of $7.15 billion, according to IBES data from Refinitiv.

Mollenkopf told Reuters the company expects overall 5G handset shipments this calendar year to come in at the top of the company’s expected range of 175 million to 225 million units. The company also raised its forecast for 5G handset shipments for 2021 to a midpoint of 500 million units.

He also said Qualcomm has applied for licenses from the United States government to ship chips to Huawei Technologies Co Ltd but has received response yet from U.S. officials.

Source link

- Advertisement -

More articles


Please enter your comment!
Please enter your name here

- Advertisement -

Latest article