Wireless-chip leader Qualcomm delivered mixed results for its fiscal third quarter and offered a disappointing outlook for the current period. QCOM stock fell Thursday on the news.
The San Diego-based company late Wednesday said it earned an adjusted $1.87 a share on sales of $8.45 billion in the quarter ended June 25. Analysts polled by FactSet had expected Qualcomm earnings of $1.81 a share on sales of $8.51 billion. On a year-over-year basis, Qualcomm earnings declined 37% while sales dropped 23%.
Qualcomm's sales and earnings have fallen for three consecutive quarters amid a slowdown in smartphone sales.
For the current quarter, Qualcomm predicted adjusted earnings of $1.90 a share on sales of $8.5 billion. That's based on the midpoint of its guidance. Wall Street had called for earnings of $1.92 a share on sales of $8.74 billion in the fiscal fourth quarter. In the year-earlier period, Qualcomm earned an adjusted $3.13 a share on sales of $11.39 billion.
QCOM Stock Tanks After Report
On the stock market today, QCOM stock dropped 8.2% to close at 118.70. During the regular session Wednesday, QCOM stock sank 2.1% to end the regular session at 129.27.
Qualcomm stock has formed a cup base with a buy point of 139.94, according to IBD MarketSmith charts.
In a news release, Chief Executive Cristiano Amon said artificial intelligence applications could drive increased chip sales for Qualcomm.
"As AI use cases proliferate to the edge, on-device AI has the potential to drive an inflection point across all our products," Amon said. "Qualcomm remains best positioned to lead this transition given the unmatched accelerated computing performance with the power efficiency of our platforms."
Other Semiconductor Stocks Post Earnings
Qualcomm ranks No. 10 out of 36 stocks in IBD's fabless semiconductor industry group, according to IBD Stock Checkup. QCOM stock also has an IBD Composite Rating of 85 out of 99.
IBD's Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
Other semiconductor stocks reporting earnings late Wednesday included Qorvo and SiTime.
Qorvo stock dipped 0.3% to 105.84 on Thursday even though the chipmaker posted a beat-and-raise report. Meanwhile, SiTime stock jumped 8.7% to 138.30 after it delivered better-than-expected second-quarter results.
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