Qualcomm reported robust financial results for the third quarter of fiscal 2024, with non-GAAP revenues of $9.4 billion and earnings per share of $2.33, surpassing the midpoint of the company’s guidance range. The earnings call, held on July 31, 2024, emphasized Qualcomm’s successful diversification strategy and significant strides in automotive and AI sectors.
Key Financial Highlights:
• Revenue: $9.4 billion, non-GAAP, up 2% sequentially.
• Earnings Per Share (EPS): $2.33 non-GAAP.
• Chipset Business Revenue: $8.1 billion, driven by growth in automotive and IoT sectors.
• Licensing Business Revenue: $1.3 billion.
Strategic Focus and Diversification Efforts:
CEO Cristiano Amon outlined Qualcomm’s ongoing diversification efforts beyond its traditional handset business. The company reported strong growth in its automotive and IoT segments, attributing this success to strategic design wins and the expanding adoption of Snapdragon platforms.
• Automotive Sector: Qualcomm secured over 10 new design wins with global automakers, expanding the presence of its Snapdragon Digital Chassis across next-generation digital cockpit, connectivity, and ADAS/autonomy solutions.
• IoT Sector: The company’s IoT revenues increased by 9% sequentially, reaching $1.4 billion. This growth reflects a gradual recovery in the industry environment and Qualcomm’s leadership in industrial IoT applications.
Q3 Results by Business Unit:
• Client Computing Group (CCG): $7.4 billion, up 9% year-over-year, driven by premium Android handsets and Chinese OEM growth.
• Data Center and AI (DCAI): $3.0 billion, down 3% year-over-year, reflecting ongoing challenges but steady performance.
• Network and Edge (NEX): $1.3 billion, down 1% year-over-year.
• Automotive Revenues: Achieved a record $811 million, up 34% sequentially.
• Licensing Business (QTL): $1.3 billion in revenue, with an EBT margin of 70%.
Future Outlook:
Looking ahead to the fourth quarter of fiscal 2024, Qualcomm provided optimistic guidance:
• Revenue Forecast: $9.5 billion to $10.3 billion.
• Non-GAAP EPS: $2.45 to $2.65.
• QTL Revenues: Estimated between $1.35 billion and $1.55 billion.
• QCT Revenues: Expected to be between $8.1 billion and $8.7 billion, with a focus on IoT and automotive growth.
Key Points from the Earnings Call:
• Strong Q3 Performance: Revenue of $9.4 billion, up 2% sequentially.
• EPS: Non-GAAP EPS of $2.33.
• Q4 Revenue Forecast: $9.5 billion to $10.3 billion.
• Q4 EPS Forecast: Non-GAAP EPS of $2.45 to $2.65.
• Automotive Design Wins: More than 10 new design wins with global automakers.
• AI and PC Growth: Positive momentum in AI-driven devices and the successful launch of Copilot+ PCs.
• Industrial IoT Collaboration: New partnership with Aramco for industrial and enterprise use cases.
• Licensing Agreement: Long-term agreement signed with Honor, a leading Chinese smartphone OEM.
