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Qualcomm posts mixed quarter, says smartphone downturn is nearing bottom
Adjusted EPS fell slightly short of estimates, while revenue guidance for Q4 points to another profit miss versus analyst expectations.
Qualcomm reported mixed results for its most recent third quarter, missing adjusted earnings expectations but arguing that the downturn is close to its low point. Shares were sent lower after the release, following results announced July 29, according to Yahoo Finance.
In the quarter, Qualcomm posted adjusted EPS of $2.21, a penny below estimates. Revenue slipped about 4% year over year to $9.95 billion, though it still beat expectations of $9.7 billion.
Weakness was most evident in handset trends, with handset revenue down 20% year over year to $5.08 billion amid ongoing memory supply shortages. Qualcomm also said modem share for an upcoming iPhone launch is expected to be materially lower than a prior estimate of 20%, while it expects its smartphone revenue to stabilize as the worst period passes.
For the fourth quarter, Qualcomm guided revenue of $9.7 billion to $10.5 billion and adjusted EPS of $2.05 to $2.25, a range that Yahoo Finance notes comes in below what analysts expect, roughly $2.38. The company also highlighted stronger performance outside smartphones, including 28% year over year growth in combined automotive and IoT revenue, with automotive delivering 23 consecutive quarters of double-digit year over year growth.