Qualcomm Inc on Wednesday predicted increased sales of chips for 5G phones, including Apple Inc’s iPhone, as the company said it eased supply shortfalls that contributed to global chip shortages.
Qualcomm’s total revenue grew 63% to nearly $8 billion, driven by increased sales of chips for connected devices, reaching $1.4 billion.
The San Diego, California-based company is the world’s largest supplier of mobile phone chips and a leader in 5G technology, supplying the modem chips that help iPhones connect to wireless data networks and modems for most of the Android market. and central processor.
Shares rose 3.1% to $146.86 in after-market trading following the results, which may ease some concerns among investors about the impact of the shortage on the smartphone market, including the iPhone.
Qualcomm Chief Executive Officer Cristiano Amon told investors during a conference call that the company’s efforts to secure its chips from multiple manufacturing partners are fueling supplies, with the first shipments of significant volumes in the fiscal third quarter and the upcoming Coming in months. .
“We are still on track to improve supply materially by the end of the calendar year,” Amon said.
The company is also benefiting from the exit of China’s Huawei Technologies Co., Ltd. from the global smartphone market. Huawei’s flagship models didn’t use Qualcomm chips, but its rivals, which are now squandering market share, mostly do.
Qualcomm has boosted sales of other chips, such as the radio-frequency chips that augment its 5G phone chips and whose sales have doubled in the past year. Sales are also increasing for a variety of chips for cars and “Internet of Things,” or IoT, applications.
Qualcomm said on Wednesday that it expects sales of those chips to reach $10 billion this fiscal year, up from $6 billion last year. The company also said that it expects adjusted profit per share of $8.24 for its fiscal year 2021, nearly double from a year ago.
Qualcomm’s chip revenue forecast for the fourth quarter of the current fiscal year had a midpoint of $7.25 billion, compared to analyst estimates of $6.83 billion, according to Refinitiv data.
lack of chip
Amon said that even though it has fewer bottlenecks on its own as it brings in more manufacturing partners, some of Qualcomm’s customers can’t find the supporting chips from other vendors they need to make complete equipment.
“We continue to see strong demand in every single business except supply,” he said on the call.
Apple predicted on Tuesday that chip shortages would start affecting its iPhone in the fourth quarter.
On Wednesday, Qualcomm said that global sales of 5G handsets for 2021 were likely to come in at the high end of its forecast of 450 to 550 million handsets. That means phone makers are directing any chips in short supply toward production of their more profitable 5G devices. Apple shares were up 0.14% in after-hours trading following Qualcomm’s results.
Qingai Chan, an analyst, said, “Some periphery chips in the smartphone segment continue to have some parts tightness, but we don’t think its content could cause any meaningful decline, as the industry supplies 5G instead of 4G.” will prioritize.” In the Summit Insights group.
According to Refinitiv data, Qualcomm forecast total sales and adjusted profit with a midpoint of $8.8 billion and $2.25 per share, above estimates of $8.50 billion and $2.04 per share.
According to Refinitiv data, the company forecast revenue from its patent licensing business with a midpoint of $1.55 billion, compared to analyst expectations of $1.56 billion.
For the fiscal third quarter ended June 27, Qualcomm said total adjusted revenue and adjusted profit were $8 billion and $1.92 per share, according to Refinitiv data, which exceeded estimates of $7.58 billion and $1.68 per share.
Mobile handset chips remain Qualcomm’s biggest seller, rising 57% to reach $3.86 billion in the quarter.
“Qualcomm has done a phenomenal job in driving the 5G ecosystem. Certainly it is moving much faster than 4G,” said Paolo Pescatore, an analyst at PP Foresight.
Sales of other chips are also expanding, with sales of radio frequency chips and IoT chips reaching $957 million and $1.4 billion, up 114% and 83%, respectively, from a year ago.
read all Breaking Newshandjob breaking news And coronavirus news Here