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Qualcomm Q4 Results Trounce Street View, Outlook Strong; Shares Up 5%

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Shares of Qualcomm Inc. (QCOM) jumped 5% in extended trading session Wednesday after the chip maker's profit and revenues for the fourth quarter trumped Wall Street estimates. The company also issued a strong outlook for the first quarter, reflecting high demand for chips used in smartphones and other handheld devices.

San Diego, California-based Qualcomm's fourth-quarter profit dropped 5% to $2.798 billion or $2.45 per share from $2.960 billion or $2.58 per share last year.

Adjusted earnings for the quarter were $2.916 billion or $2.55 per share, up from $1.669 billion or $1.45 per share last year. On average, 23 analysts polled by Thomson Reuters expected earnings of $2.26 per share. Analysts' estimates typically exclude special items.

Qualcomm's fourth-quarter revenues jumped 12% to $9.336 billion from $8.346 billion last year. Adjusted revenues were $9.321 billion, a 43% surge from $6.502 billion last year. Analysts had a consensus revenue estimate of $8.86 billion for the quarter.

The company reported 56% surge in revenues in the QCT segment, which makes chips, driven by strong demand for chips for smartphones and handsets.

Meanwhile, QTL segment, the company's technology licensing division, grew 3% to $1.55 billion in revenues.

"As of fiscal 2021, we are exceeding our 2019 Analyst Day targets for revenue growth and diversification and operating margin expansion, while more than doubling our year-over-year Non-GAAP EPS," said CEO Cristiano Amon. "We are well positioned to continue to lead in mobile and enable the digital transformation of industries with our broad portfolio of relevant technologies. Our results across RF front-end, Automotive and IoT attest to the success of our technology roadmap and revenue diversification strategy."

Looking forward, the company expects first-quarter adjusted earnings of $2.90 to $3.10 per share and revenues of $10.0 billion to $10.8 billion. Analysts currently estimate earnings of $2.60 per share and revenues of $9.70 billion.

QCOM closed Wednesday's trading at $138.50, up $3.27 or 2.42%, on the Nasdaq. The stock further gained $7.25 or 5.23% in the after-hours trading.

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