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Will Top-Line Growth Boost Qualcomm's (QCOM) Q1 Earnings?
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Qualcomm Incorporated (QCOM - Free Report) is scheduled to report first-quarter fiscal 2024 results on Jan 31, after the closing bell. It pulled off a trailing four-quarter earnings surprise of 2.23%, on average. The San Diego, CA-based company is expected to record a top-line expansion year over year, backed by the growing demand for Snapdragon chipsets and the introduction of cutting-edge AI-native solutions.
Factors at Play
During the quarter, Qualcomm announced the launch of next-generation Snapdragon platforms designed to support advanced generative AI devices and applications. It introduced the Snapdragon 8 Gen 3, which is equipped with the most powerful NPU (Neural Processing Unit) for mobile devices. Leveraging AI, it significantly improves the camera, gaming, sound, content creation and connectivity experience for high-end smartphones.
It also unveiled the Snapdragon X Elite, which combines industry-leading NPU with top-tier CPU performance. The platform delivers robust efficiency in completing generative AI tasks and its high reliability makes it suitable for Windows 11 PCs. These are likely to have generated incremental revenues in the quarter.
In the quarter under review, Qualcomm has unveiled state-of-the-art Snapdragon 7 Gen 3 chipsets with advanced AI features for mid-range smartphones. Owing to its premium attributes, the product is already getting attention from major manufacturers, with HONOR and VIVO, two prominent Chinese smartphone makers, set to become the first to incorporate the chipsets into their products. Qualcomm’s X35 5G Modem-RF System is also gaining strong momentum, owing to the growing demand for 5G RedCap devices. These developments are expected to have a positive impact on the company’s first-quarter results.
Our revenue estimate for the QCT segment is pegged at $8.05 billion, suggesting a year-over-year improvement of 2.1%, while that for the QTL segment is pegged at $1.35 billion, down 11%.
For the December quarter, the Zacks Consensus Estimate for revenues is pegged at $9.5 billion, indicating growth from the year-ago quarter’s tally of $9.45 billion. Adjusted earnings per share are pegged at $2.38, suggesting a marginal increase from $2.37 in the year-ago quarter.
Earnings Whispers
Our proven model predicts a likely earnings beat for Qualcomm this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is exactly the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +3.45%. The Most Accurate Estimate is pegged at $2.46, while the Zacks Consensus Estimate stands at $2.38. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Qualcomm currently has a Zacks Rank #3.
Other Stocks to Consider
Here are some other companies you may want to consider, as our model shows that these, too, have the right combination of elements to post an earnings beat this season:
The Earnings ESP for NVIDIA Corporation (NVDA - Free Report) is +3.68% and it sports a Zacks Rank of 2. The company is scheduled to report quarterly numbers on Feb 21.
The Earnings ESP for Meta Platforms, Inc. (META - Free Report) is +0.79% and it carries a Zacks Rank of 2. The company is scheduled to report quarterly numbers on Feb 1.
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Will Top-Line Growth Boost Qualcomm's (QCOM) Q1 Earnings?
Qualcomm Incorporated (QCOM - Free Report) is scheduled to report first-quarter fiscal 2024 results on Jan 31, after the closing bell. It pulled off a trailing four-quarter earnings surprise of 2.23%, on average. The San Diego, CA-based company is expected to record a top-line expansion year over year, backed by the growing demand for Snapdragon chipsets and the introduction of cutting-edge AI-native solutions.
Factors at Play
During the quarter, Qualcomm announced the launch of next-generation Snapdragon platforms designed to support advanced generative AI devices and applications. It introduced the Snapdragon 8 Gen 3, which is equipped with the most powerful NPU (Neural Processing Unit) for mobile devices. Leveraging AI, it significantly improves the camera, gaming, sound, content creation and connectivity experience for high-end smartphones.
It also unveiled the Snapdragon X Elite, which combines industry-leading NPU with top-tier CPU performance. The platform delivers robust efficiency in completing generative AI tasks and its high reliability makes it suitable for Windows 11 PCs. These are likely to have generated incremental revenues in the quarter.
In the quarter under review, Qualcomm has unveiled state-of-the-art Snapdragon 7 Gen 3 chipsets with advanced AI features for mid-range smartphones. Owing to its premium attributes, the product is already getting attention from major manufacturers, with HONOR and VIVO, two prominent Chinese smartphone makers, set to become the first to incorporate the chipsets into their products. Qualcomm’s X35 5G Modem-RF System is also gaining strong momentum, owing to the growing demand for 5G RedCap devices. These developments are expected to have a positive impact on the company’s first-quarter results.
Our revenue estimate for the QCT segment is pegged at $8.05 billion, suggesting a year-over-year improvement of 2.1%, while that for the QTL segment is pegged at $1.35 billion, down 11%.
For the December quarter, the Zacks Consensus Estimate for revenues is pegged at $9.5 billion, indicating growth from the year-ago quarter’s tally of $9.45 billion. Adjusted earnings per share are pegged at $2.38, suggesting a marginal increase from $2.37 in the year-ago quarter.
Earnings Whispers
Our proven model predicts a likely earnings beat for Qualcomm this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is exactly the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +3.45%. The Most Accurate Estimate is pegged at $2.46, while the Zacks Consensus Estimate stands at $2.38. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
QUALCOMM Incorporated Price and EPS Surprise
QUALCOMM Incorporated price-eps-surprise | QUALCOMM Incorporated Quote
Zacks Rank: Qualcomm currently has a Zacks Rank #3.
Other Stocks to Consider
Here are some other companies you may want to consider, as our model shows that these, too, have the right combination of elements to post an earnings beat this season:
InterDigital, Inc. (IDCC - Free Report) is set to release quarterly numbers on Feb 15. It has an Earnings ESP of +1.93% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Earnings ESP for NVIDIA Corporation (NVDA - Free Report) is +3.68% and it sports a Zacks Rank of 2. The company is scheduled to report quarterly numbers on Feb 21.
The Earnings ESP for Meta Platforms, Inc. (META - Free Report) is +0.79% and it carries a Zacks Rank of 2. The company is scheduled to report quarterly numbers on Feb 1.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.