The strong position in the smartphone market is boosting the business of chip group Qualcomm. For the third fiscal quarter ended June, revenue increased 36 percent year over year to $10.94 billion. Net profit even jumped 84 percent to $3.73 billion (3.66 billion euros), as Qualcomm announced after the US stock market closed on Wednesday.
Qualcomm has thus slightly exceeded the expectations of the financial industry. Wall Street had expected quarterly sales of $10.88 billion, CNBC reports. A year ago, 5G demand had boosted Qualcomm’s business, according to Qualcomm boss Cristiano Amon, it is now the automotive division and the Internet of Things (IoT) that are setting new record results. Their sales grew by 38 and 31 percent year-on-year.
At Qualcomm, however, the smartphone business continues to make up by far the largest share of sales at over 56 percent. In contrast, automotive chips and IoT together account for just 20 percent of revenue. The remainder of the hardware turnover comes from radio chips such as modems. Qualcomm plays a leading role here – alongside the Snapdragon processors in many smartphones with the Google Android operating system.
New Samsung contract and moderate outlook
A second mainstay is the business with licenses for technologies patented by Qualcomm. This accounts for 14 percent of total sales. A new multi-year license agreement was signed with smartphone market leader Samsung in the last quarter. It should also include the development of future mobile communications standards after today’s 5G, said Qualcomm CEO Amon.
For the current quarter, Qualcomm expects revenues of between $11 and $11.8 billion. This is less than expected, because market observers expected sales to be around $11.87 billion. This is probably one of the reasons why Qualcomm’s share price fell by almost 4 percent in after-hours trading after the paper had already fallen by around 18 percent over the course of the year.
To home page