Qualcomm delivers solid fiscal Q3 results and guidance amid strong chip demand

Qualcomm (NASDAQ:) Incorporated (NASDAQ: QCOM) reported third-quarter earnings and revenue that topped analyst estimates and delivered optimistic guidance for the fourth quarter.

The company’s earnings per share (EPS) for the third quarter came in at $2.33, exceeding the analyst consensus by $0.08. Revenue for the quarter was also higher than expected at $9.39 billion, compared to the consensus estimate of $9.21 billion.

The chipmaker’s shares initially rose in after-hours trading following the report but later lost those gains, trading down 1.7% in Thursday’s premarket.

Qualcomm anticipates an EPS range of $2.45 to $2.65 for the upcoming quarter, with the midpoint of $2.55 surpassing the consensus estimate of $2.45.

The company’s revenue forecast of $9.5 to $10.3 billion also beats the consensus of $9.71 billion, indicating potential continued growth.

“The company is taking market share in premium Android handsets, Automotive cockpit, and PC,” Rosenblatt analysts commented.

“The next phase of AI growth is at the network edge. We see the company as well positioned for AI and Gen AI applications expanding into these network edge markets,” they added, lifting their price target on QCOM stock from $240 to $250. 

President and CEO Cristiano Amon highlighted the successful execution of Qualcomm’s growth strategy and the high-end performance of its QCT quarterly revenues and EBT margins.

Amon also expressed enthusiasm for the launch of the Snapdragon X Series solutions for PCs, marking a significant milestone in the company’s transformation towards intelligent computing.

Meanwhile, analysts at Mizuho said Qualcomm’s “compelling handset AI offering could drive a global handset refresh cycle with higher ASP (average selling price) tailwinds.”

The investment bank adjusted its QCOM estimates and slightly raised its target price from $240 to $245. 

Going forward, Mizuho analysts believe the key focus will be AI on iPhone 16 “and competition from China Android handsets which are long-awaited refresh cycle driver.”