Back to top

Analyst Blog

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Qualcomm Inc. (QCOM - Analyst Report) reported solid financial results for the third quarter of fiscal 2013, beating the Zacks Consensus Estimate. Management has raised its outlook for fiscal 2013. As a result, in the after market trade on NASDAQ, the stock price of the company was up $2.49 (4.06%) to $63.88. Qualcomm currently has a Zacks Rank #3 (Hold). 

Qualcomm is facing competitive threat from its closest rival, Intel Corp. (INTC - Analyst Report), which has been redesigning its chipsets for the mobile computing market. Competition is also likely to emanate from formidable rivals like Broadcom Corp. (BRCM - Analyst Report) and NVIDIA Corp. (NVDA - Analyst Report). Despite this, the company is maintaining its strong performance on the back of innovative high-end chipsets and a broad global customer base.

Revenues

Quarterly total revenue of $6,243 million was up 35% year over year, surpassing the Zacks Consensus Estimate of $6,030 million. Segment wise, Qualcomm CDMA Technologies businesses contributed $4,222 million of revenues in the third quarter, up 47% over the prior-year quarter. Quarterly EBT margin was 17%. Qualcomm Technology Licensing generated $1,867 million in revenues, up 17% year over year. Quarterly EBT margin was 87%. Qualcomm Wireless & Internet segment generated $158 million, down 1% year over year and its operating loss was $16 million.

Net Income

On a GAAP basis, quarterly net income from continuing operations was $1,580 million or 90 cents per share compared with $1,203 million or 69 cents in the year-ago quarter. In the third quarter of fiscal 2013, adjusted (excluding special items) earnings per share came in at 92 cents, a penny higher than the Zacks Consensus Estimate.

Chipset Statistics

During the third quarter of fiscal 2013, Qualcomm shipped approximately 172 million CDMA-based MSM chipsets, up 22% year over year. This figure was far better than the company’s guidance of a mid-point of 168 million. Average selling price of a mobile handset with an in-built Qualcomm chipset during this quarter was $227-$233.

Operating Metrics

Quarterly operating income was $1,677 million compared with $1,382 million in the year-ago quarter. Gross margin was 60% compared with 62.8% in the year-ago quarter. Quarterly operating margin was 26.9% compared with 29.9% in the prior-year quarter. In the reported quarter, the company returned $604 million (35 cents per share) to its shareholders in the form of cash dividends and another $1.04 billion through buyback of 16.7 million shares of common stock.

Cash Flow

During the third quarter of fiscal 2013, Qualcomm generated $2,077 million of cash from operations compared with $922 million in the prior-year quarter. Free cash flow, in the reported quarter, was $1,763 million compared with $523 million in the year-ago quarter.

Liquidity

At the end of the third quarter of fiscal 2013, Qualcomm had $30,402 million versus $26,837 million at the end of fiscal 2012. The company has no outstanding debt.

Fourth Quarter of Fiscal 2013 Financial Guidance

The fourth-quarter revenues will likely be within the range of $5.9 billion - $6.6 billion. Non-GAAP earnings per share will be $1.02 - $1.10. GAAP earnings per share will be within the range of 86 cents - 94 cents. Qualcomm is expected to ship 171 million - 181 million MSM chipsets in the fourth quarter of fiscal 2013.

Full Fiscal 2013 Financial Guidance

The fiscal 2013 revenues will be within the range of $24.3 billion - $25 billion. Non-GAAP earnings per share will be within the range of $4.48 - $4.56. GAAP earnings per share is expected in the range of $3.90 - $3.98. ASP of mobile handset with an in-built Qualcomm chipset during fiscal 2013 will be around $223 - $229.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
DIXIE GRP IN DXYN 15.84 +7.90%
BOFI HLDG IN BOFI 85.30 +4.97%
RAMBUS INC RMBS 12.31 +4.41%
VIPSHOP HOLD VIPS 148.73 +4.35%
NETFLIX INC NFLX 345.74 +4.32%