Qualcomm 1Q18 earnings beat the street, but there are plenty of aches
Qualcomm has come out of its second fiscal quarter of 2018 better off than last year and better than what investors were expecting.
Gross earnings were marked at $5.26 billion, up 5 percent from last winter. Net income has come down by 52 percent to $363 million. Reuters reports that earnings per share excluding one-time items amounted to 80 cents, 10 cents up from market consensus.
The results themselves were negative overall: hardware sales, which make up the majority of the company’s earnings on any given quarter, were up 6 percent to nearly $3.9 billion, but licensing revenues dropped 44 percent to $1.26 billion. Most of that decline can be attributed to the ongoing legal spat between the company and Apple over the chipmaker’s alleged anti-competitive behavior. The iPhone maker has diverted business to other suppliers in the meantime and there’s no resolution in sight.
Moving ahead, the company is still waiting on Chinese regulators to approve of its $44 billion takeover of NXP Semiconductors. Qualcomm hopes to counter some of the dead weight it has to bear with cost-cutting. It forecasts current quarter revenues to range between $4.8 billion and $5.6 billion.