Qualcomm reported a smaller-than-expected drop in profit for its fiscal first quarter to December, citing strong 3G/4G device sales and its cost-cutting efforts. Revenues were still down 19 percent year-on-year to USD 5.8 billion, while net profit dropped 24 percent to USD 1.5 billion. EPS declined 15 percent to USD 0.99, a smaller drop than the 23-32 percent forecast earlier by the company.
MSM chip shipments fell 10 percent from a year earlier to 242 million, but were at the high end of Qualcomm's guidance. The company estimates the number of 3G/4G devices shipped worldwide, which are reported a quarter later for its licensing, rose around 8 percent year-on-year to 307-311 million in calendar Q3, while the average selling price was down just 1 percent to USD 193-199 per device.
For fiscal Q2, Qualcomm forecast a further drop in revenues, of 17-29 percent on an annual basis to USD 4.9-5.7 billion. EPS is expected to improve 10-25 percent from a year earlier to USD 0.90-1.00, helped by its share repurchases. Qualcomm estimates 3G/4G device sales were down 4-14 percent year-on-year in calendar Q4, while its own MSM shipments are expected to fall 16-25 percent in the current quarter to 175-195 million.
Qualcomm said it was on track with its cost control measures and increasing licensing in China. The company also said design traction for its new Snapdragon 820 processor remains strong, and it expects improving trends in the chipset business in the second half of fiscal 2016.
