Qualcomm Reports Record Revenue but Stock Drops on Guidance

Qualcomm enjoys a record quarter with double-digit revenue growth, but shares fell despite positive guidance, raising questions for investors. Stock price down 28% from June high.

Date: 09-02-2025

AI Rating: 7

Performance Overview
Qualcomm has reported strong fiscal first-quarter results characterized by robust double-digit revenue growth across various segments, particularly in handsets, automotive, and IoT. Notably, revenue surged 17% year-over-year to $11.67 billion, exceeding analyst expectations of $10.93 billion. This indicates a solid performance that may generally boost investor confidence.

Earnings Per Share (EPS)
Adjusted EPS rose sharply by 24% to $3.41, surpassing the analysts' estimates of $2.96. This positive trajectory in earnings demonstrates strong operational efficiency and profitability, attracting investors looking for growth.

Revenue Growth
Qualcomm achieved significant revenue expansion across its key segments: Handsets revenue increased by 13%, automotive revenue soared 61%, and IoT revenue surged by 36%. This consistent performance reinforces Qualcomm's competitive position in a challenging market, specifically in automotive and IoT sector advancements.

Outlook and Guidance
Qualcomm provided an upbeat guidance for fiscal Q2, predicting revenue between $10.3 billion and $11.2 billion (growth of 10% to 19%). The forecast for EPS is between $2.70 and $2.90, which aligns closely with expectations. Although licensing revenue is expected to dip sequentially, the overall guidance remains well received.

Impact Analysis
The stock's decline despite strong results could reflect investors' concerns over the licensing segment's growth and the challenges posed by a more mature smartphone market. Nonetheless, Qualcomm does show promising initiatives in diversified revenue streams outside smartphones, particularly in automotive and IoT, which might bode well for long-term growth potential.

Stocks: QCOM