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It has been about a month since the last earnings report for Qualcomm (QCOM). Shares have lost about 7.8% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Qualcomm due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Qualcomm Surpasses Q1 Earnings Estimates on Record Revenues
Qualcomm Incorporated reported strong first-quarter fiscal 2025 results, with adjusted earnings and revenues beating the respective Zacks Consensus Estimate, driven by healthy demand trends in Android handsets and automotive businesses. Both metrics improved year over year, led by the strength of the business model, revenue diversification and the ability to respond proactively to the evolving market scenario.
Net Income
On a GAAP basis, net income in the December quarter improved to $3.18 billion or $2.83 per share from $2.77 billion or $2.46 per share in the prior-year quarter. The increase was attributable to top-line growth.
Quarterly non-GAAP net income came in at $3.83 billion or $3.41 per share compared with $3.1 billion or $2.75 per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 48 cents.
Revenues
On a GAAP basis, total revenues in the fiscal first quarter were record high at $11.67 billion, up from $9.94 billion in the year-ago quarter. The quarterly revenues beat the consensus mark of $10.89 billion. Qualcomm registered record automotive revenues for the sixth consecutive quarter owing to solid momentum in the Snapdragon Digital Chassis platform. Strength within the handset and industrial Internet of Things (IoT) businesses also buoyed the top line.
Segment Results
Quarterly revenues from Qualcomm CDMA Technologies (QCT) were record high at $10.08 billion, up from $8.42 billion a year ago, as strength in the automotive platform and higher demand in handsets, along with normalization of channel inventory within the IoT business, aided the top-line growth. The company witnessed solid market traction in the EDGE networking business that helps transform connectivity in cars, business enterprises, homes, smart factories, next-generation PCs, wearables and tablets.
Automotive revenues rose 61% to a record high of $961 million, driven by increased content in new vehicle launches with its Snapdragon Digital Chassis platform, with automakers deploying high-performance, low-power computing and connectivity chips to bring next-generation experience to consumers. Handset revenues jumped 13% to an all-time high of $7.57 billion, led by healthy traction in premium Android handsets. IoT revenues were up 36% to $1.55 billion on new product launches and channel inventory normalization. EBT margin for the QCT segment rose to 32% from 31%.
Qualcomm Technology Licensing (QTL) revenues totaled $1.54 billion, up 5% year over year, as it remained the industry's most extensive licensing program of cellular essential patents. EBT margin improved to 75% from 74%.