Qualcomm, a leading player in the semiconductor industry, recently reported its fiscal third-quarter results, which exceeded market expectations primarily due to robust growth in automotive sales. However, the company also issued a cautionary note regarding potential revenue losses stemming from the U.S.
government's decision to revoke its export license to China's tech giant, Huawei Technologies. The company anticipates adjusted earnings in the range of $2.45 to $2.65 per share for the upcoming fiscal fourth quarter, slightly below the Street's consensus estimate of $2.53. Qualcomm projects its revenue for this quarter to fall between $9.5 billion and $10.3 billion, compared to the Capital IQ consensus of $9.8 billion. Focusing on the Qualcomm CDMA technologies division, which encompasses its semiconductor operations, anticipated revenue is forecasted to be between $8.1 billion and $8.7 billion.
Additionally, the revenue from the technology licensing unit is expected to range from $1.35 billion to $1.55 billion. In remarks made during an earnings call, Chief Financial Officer Akash Palkhiwala highlighted a significant change regarding their export license to Huawei, which was originally set to expire at the end of calendar 2024 but was revoked on May 7.
"This change will impact our revenues in both the current quarter and the first quarter of fiscal 2025," he noted, based on insights shared during the call. Despite these challenges, Qualcomm's shares experienced an 8.4% increase by the end of Wednesday's trading session, although they saw a slight decline of 1.3% in Thursday's premarket activity. For the three-month period ending June 23, Qualcomm reported a 25% year-over-year increase in adjusted earnings per share (EPS), reaching $2.33, which surpassed analysts' expectations of $2.26.
In terms of revenue, the company saw an 11% increase from the previous year, totaling $9.39 billion for the third quarter, which also exceeded market projections of $9.22 billion. Diving deeper into the Qualcomm CDMA technologies segment, automotive revenue soared to $811 million, climbing significantly from $434 million in the same period last year.
Looking ahead, the company predicts that its automotive sector will remain stable in the fourth quarter. Furthermore, the handsets revenue showcased a 12% increase, nearing $5.9 billion, while the Internet of Things revenue experienced a decline of 8%, falling to $1.36 billion. Sales within the technology licensing division grew by 3% year over year, reaching $1.27 billion. In closing, Palkhiwala expressed enthusiasm about the company's trajectory, stating, "We are on track to deliver approximately 50% year-over-year revenue growth in fiscal 2024, providing confidence in our ability to execute to our long-term targets." Price: 177.86, Change: -3.09, Percent Change: -1.71 Dealing with geopolitical uncertainties and industry challenges, Qualcomm's resilience in the face of adversity positions it well for the future..