Steve Mollenkopf, chief executive officer of Qualcomm Inc.
Patrick T. Fallon | Bloomberg | Getty Images
Qualcomm reported second-quarter earnings after the bell on Wednesday.
The stock was up more than 4% after hours, in addition to a nearly 5% rise during trading on Wednesday.
Here’s how it did:
- EPS: $0.88
- Revenue: $5.21 billion
Wall Street had anticipated earnings per share of $0.78 on revenue of $5.025 billion based on Refinitiv consensus estimates. However, it’s difficult to compare reported earnings to analyst estimates for Qualcomm’s Q2, as the coronavirus pandemic continues to hit global economies and makes earnings impact difficult to assess.
Revenue for Qualcomm was up 7% year-over-year and diluted EPS was up 14% year-over-year.
The chip maker is being closely watched because it sells parts and licenses technology to most of the world’s top smartphone makers, and its performance could provide a preview of how the Covid-19 pandemic is hurting the consumer electronics industry.
Qualcomm is the leading maker of 5G chips and has a lot of related patents, so its results also shed some light into how the rollout of 5G networks is tracking around the world.
Qualcomm said that the pandemic reduced demand for phones in the second quarter about 21% compared to its previous expectations and on a year-over-year basis. It also warned of lower phone shipments in the quarter ending in June, as the pandemic has chilled economies around the world.
“Our guidance for the third quarter of fiscal 2020 being based on a planning assumption that there will be an approximate 30% reduction in handset shipments relative to our prior expectations,” according to a note in Qualcomm’s press release.
In its third fiscal quarter, Qualcomm is expecting earnings per share of between $0.60 and $0.80, about 30 cents less than it would have been due to the coronavirus pandemic.
This story is developing. Please check back for updates.