Steve Mollenkopf, chief executive officer of Qualcomm Inc., speaks during a Business Roundtable CEO Innovation Summit discussion in Washington, D.C., U.S., on Thursday, Dec. 6, 2018. The summit features discussions with Americas top chief executive officers, government leaders and industry experts on ideas and policies. Photographer: Andrew Harrer/Bloomberg via Getty ImagesAndrew Harrer | Bloomberg | Getty Images
Qualcomm shares rose as much as 6% in extended trading on Wednesday after the chipmaker reported fiscal second-quarter earnings that exceeded analysts’ estimates.
Here’s how the company did:
Earnings: $1.90 per share, adjusted, vs. $1.67 per share as expected by analysts, according to Refinitiv.Revenue: $7.93 billion, vs. $7.62 billion as expected by analysts, according to Refinitiv.
Revenue grew 52% on an annualized basis in the quarter, which ended on March 28, according to a statement. Lower phone demand because of the coronavirus in the year-ago quarter made for faster growth than usual. In the previous quarter, revenue grew 63%.
The company’s profitable Qualcomm Technology Licensing segment, which includes mobile handset patent royalties, contributed $1.61 billion in revenue, which was up 51% and above the $1.35 billion consensus among analysts surveyed by FactSet.
Qualcomm derives much of its revenue from handset chips, and the deployment of 5G networks creates a growth opportunity for the company, particularly as the economy reopens and people begin to travel more.
Handset revenue, at $4.07 billion, grew 53%, although analysts polled by FactSet had expected $4.23 billion. The larger Qualcomm CDMA Technologies Segment, which includes handsets as well as radio frequency front end, internet of things and automotive components, came up with $6.28 billion in revenue, surpassing the $6.26 billion FactSet consensus.
The company said it now has an upward bias to high-single-digit growth in 3G, 4G and 5G handset shipments in 2021, rather than the high-single-digit growth forecast it gave in January.
Some of that growth should strengthen Qualcomm’s next quarter. Qualcomm called for fiscal third-quarter adjusted earnings of $1.55 to $1.75 per share on $7.1 billion to $7.9 billion in revenue. Analysts polled by Refinitiv had expected $1.52 in adjusted earnings per share on $7.11 billion in revenue.
In the fiscal second quarter Qualcomm acquired chip