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Qualcomm (QCOM - Free Report) posts its first quarterly report since its settlement with Apple (AAPL - Free Report) had been announced on IP rights and usage, and the company beat estimates on both top and bottom lines after the closing bell Wednesday. Earnings of 77 cents per share surpassed the 71 cents in the Zacks consensus, on revenues of $4.98 billion which easily outpaced the expected $4.8 billion.
The earnings beat is nothing new for Qualcomm, which has not missed in any quarter since the reconfiguration of Zacks earnings data (calendar Q2 2015), with a trailing 4-quarter average of +19%. And the IP deal with Apple — bringing an end to litigation between the two companies, along with Apple licensing Qualcomm’s chips for 6 years, likely for use with Apple’s coming 5G iPhone — happened in early April, after Qualcomm’s fiscal Q2 had concluded.
Qualcomm did indicate an expected gain from the deal in its fiscal Q3 of $4.5-4.7 billion, indicated to be a GAAP payment. Shares, which had taken off like a rocket on the Apple deal announcement a month ago, are selling the news in late trading, down 4.3%.
Fitbit also outperformed expectations in its Q1 report also released Wednesday afternoon: -15 cents per share was better than the -22 cents analysts were looking for. Revenues of $272 million easily topped the consensus $259.88 million. But Q2 guidance on the bottom line was worse than current estimates, while they remained in-line with current top-line consensus. Devices sold grew 36%, but Average Selling Price fell 19%. Shares are trading up 1.8% in after-hours.
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Qualcomm (QCOM) Beats, Traders Sell the News
Qualcomm (QCOM - Free Report) posts its first quarterly report since its settlement with Apple (AAPL - Free Report) had been announced on IP rights and usage, and the company beat estimates on both top and bottom lines after the closing bell Wednesday. Earnings of 77 cents per share surpassed the 71 cents in the Zacks consensus, on revenues of $4.98 billion which easily outpaced the expected $4.8 billion.
The earnings beat is nothing new for Qualcomm, which has not missed in any quarter since the reconfiguration of Zacks earnings data (calendar Q2 2015), with a trailing 4-quarter average of +19%. And the IP deal with Apple — bringing an end to litigation between the two companies, along with Apple licensing Qualcomm’s chips for 6 years, likely for use with Apple’s coming 5G iPhone — happened in early April, after Qualcomm’s fiscal Q2 had concluded.
Qualcomm did indicate an expected gain from the deal in its fiscal Q3 of $4.5-4.7 billion, indicated to be a GAAP payment. Shares, which had taken off like a rocket on the Apple deal announcement a month ago, are selling the news in late trading, down 4.3%.
Fitbit also outperformed expectations in its Q1 report also released Wednesday afternoon: -15 cents per share was better than the -22 cents analysts were looking for. Revenues of $272 million easily topped the consensus $259.88 million. But Q2 guidance on the bottom line was worse than current estimates, while they remained in-line with current top-line consensus. Devices sold grew 36%, but Average Selling Price fell 19%. Shares are trading up 1.8% in after-hours.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.
This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.
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