Qualcomm’s Q4 Earnings Surpass Expectations, Raises Concerns for Q1 Forecast

Qualcomm (NASDAQ:) Inc., the San Diego-based chipmaker, has reported a profit of $1.49 billion for its fiscal fourth quarter, surpassing Wall Street expectations. With earnings per share (EPS) rising to $2.02 after adjusting for stock option expense, Qualcomm’s performance exceeded Zacks Investment Research’s average analyst prediction of $1.92 per share. The company’s revenue for the period amounted to $8.63 billion, exceeding analysts’ projections of $8.55 billion.

Strong Q4 Performance

Qualcomm’s Q4 2023 earnings outperformed Zacks’ estimate by 5.21% at $2.02 per share. However, this was lower than the previous year’s $3.13 per share, reflecting a downward trend in EPS. Despite the decrease, Qualcomm has consistently exceeded EPS estimates in recent quarters.

On the revenue front, Qualcomm reported $8.63 billion for Q4 2023, representing a year-on-year decrease from $11.4 billion. Although this figure exceeded Zacks’ estimate by 0.94%, the downward trend in revenue raises concerns. The stock’s immediate price and future prospects may be influenced by management commentary, Zacks Rank trends, and revenue estimates.

Challenges Ahead

Looking ahead to the upcoming quarter ending in December, Qualcomm projects its per-share earnings to range between $2.25 and $2.45. This forecast contrasts with analysts’ higher prediction of $3.18 per share. Additionally, Qualcomm anticipates its fiscal first-quarter revenue to fall within the range of $9.1 billion to $9.9 billion, significantly lower than analysts’ estimated $11.85 billion.

These forecasts raise questions about Qualcomm’s future performance and have led to uncertainty in the market regarding the company’s upcoming financial results.

InvestingPro Insights

According to InvestingPro, Qualcomm has a history of delivering high returns on invested capital and has consistently increased its dividend for 21 consecutive years. This commitment to shareholder value is an appealing aspect for potential investors.

InvestingPro’s real-time data reveals Qualcomm’s adjusted market cap of $123.75 billion and a P/E ratio of 14.34 as of Q3 2023. These figures indicate a balanced valuation compared to industry peers. Despite an 8.44% decline in revenue over the last twelve months, Qualcomm has maintained a strong gross profit margin of 56.31%, showcasing its ability to remain profitable amidst revenue fluctuations.

In addition to these insights, InvestingPro offers numerous tips and data points for investors seeking a comprehensive understanding of Qualcomm’s financial performance and prospects.

This article provides valuable insights into Qualcomm’s Q4 earnings, which surpassed expectations. However, the company’s Q1 forecast raises concerns, leading to uncertainty in the market. InvestingPro offers further analysis and information for investors interested in Qualcomm’s financial performance.