Qualcomm provided a revenue forecast for the September quarter below expectations on Wednesday, sending its stock lower in after-hours trading.
The maker of mobile processors and 5G wireless chipsets blamed a slower recovery in China and a challenging macro environment for the disappointing results.
For the June quarter, Qualcomm (ticker: QCOM) reported adjusted earnings per share of $1.87, compared with Wall Street’s consensus estimate of $1.81, according to FactSet. Revenue came in at $8.4 billion, which was below analysts’ expectations of $8.5 billion.
The bad news was the guidance. Qualcomm gave a revenue forecast for the current quarter, ending in September, of $8.1 billion to $8.9 billion—which was below the consensus of $8.7 billion at the midpoint of the range.
Qualcomm shares fell 7% in after-hours trading Wednesday following the release.
Global smartphone demand has been soft. Last week, research firm Canalys said second-quarter worldwide shipments for the mobile phones fell 10% year-over-year.
Taiwan Semiconductor Manufacturing
(TSM) also said last month the smartphone market had deteriorated over the past three months.
As a large supplier for the mobile market it is difficult for Qualcomm to overcome any general market weakness.
On a conference call with investors and analysts, Qualcomm executives said they do not see an immediate rebound in demand. As a result, they plan to implement additional cost-cutting actions during the first half of the company’s fiscal 2024 given the market uncertainty.
Qualcomm shares have declined about 12% over the past 12 months, compared with the 26% rise of the
iShares Semiconductor
exchange-traded fund (SOXX), which tracks the ICE Semiconductor Index.
Write to Tae Kim at [email protected]
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