Investing.com — Qualcomm delivered fiscal second-quarter results that topped Wall Street estimates, underpinned by improved chip sales amid an ongoing recovery in smartphone demand.
Qualcomm Incorporated (NASDAQ:QCOM) rose more than 4.4% in premarket trading Thursday.
Qualcomm reported adjusted earnings of $2.44 per share on revenue of $9.39 billion, beating projections of $2.32 and $9.34B, according to an Investing.com forecast based on a poll of analysts.
The beat on the top and bottom lines were driven by by handset chip sales rising 1% to $6.18B in Q2 from a year earlier.
For Q3, the company guided adjusted EPS in a range of $2.15 to $2.35 on revenue of revenue in the range of $8.8B to $9.6B, in-line with analyst estimates for adjusted EPS of $2.18 on revenue of $9.04B.
“Given the state of some recent peer reports we believe there was some nervousness around Qualcomm into this print, and yet the company delivered with certainly the best wireless-related results so far this earnings season,” Bernstein analysts commented in a post-earnings note.
Looking ahead, Bernstein predicts a solid outlook for QCOM, with September EPS guidance matching the current consensus, which should mitigate near-term risks.
They highlight strong product performance, increasing AI-enabled shipments, notable radio frequency (RF) content gains, and promising diversification in PC and automotive sectors, noting a significant growth in the auto pipeline.
The firm reiterated an Outperform rating on QCOM stock and lifted the target price from $200 to $220.
Similarly, KeyBanc Capital Markets analysts said they were “encouraged” with Qualcomm’s quarterly report, pointing out several catalysts that could drive future growth.
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These include RF content gains in the upcoming iPhone 16 and the launch of the Snapdragon 8 Gen 4 processor, featuring the Nuvia ARM cores, “which we believe will allow QCOM to regain 100% share in the GS25,” they wrote.
“We’re fine-tuning ests and remain OW, as we increasingly view QCOM as an edge AI beneficiary,” KeyBanc analysts added.
(Yasin Ebrahim contributed reporting)
