NEW YORK (AP) — Qualcomm reports earnings for its fiscal third quarter on Wednesday. The following is a summary of key developments and analyst opinion related to the period:
OVERVIEW: The San Diego-based company has already raised its forecast for the quarter that ended in June, on the back of recovering sales in the wireless market.
As with many businesses underpinned by patents, Qualcomm has been engaged in long-running litigation. It put one those fights behind it when reporting results for its previous quarter, in April. It agreed to pay Broadcom Corp. $891 million over four years. Broadcom is a relative newcomer to the business of making chips for cell phones but proved to be a fierce legal adversary.
BY THE NUMBERS: Analysts, on average, are expecting a profit of 52 cents per share on sales of $2.73 billion, according to a poll by Thomson Financial.
Analysts generally base their estimates on Qualcomm’s “pro forma” numbers, which exclude the cost of stock-based compensation and results from investments.
Qualcomm on June 11 raised its forecast for the quarter, saying that it expects to post pro-forma earnings of $1.06 billion to $1.11 billion, on sales of $2.67 billion to $2.77 billion.
ANALYST TAKE: Mark Sue at RBC Capital Markets initiated coverage of Qualcomm last week with an “outperform” rating, saying the company may be well positioned to increase its market share in advanced handsets. He’s expecting results to come in at the high end of the company’s guidance.
In the longer-term, he expects Qualcomm’s broadband chips for laptops and processors for smaller handheld devices to start making a bigger contribution.
STOCK PERFORMANCE: Shares of the company rose 7 percent during the quarter to close at $46.19 on June 26.
Filed Under: Infrastructure