What Can We Expect From Qualcomm’s Q1’17 Earnings?

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Leading chipset maker, Qualcomm (NYSE:QCOM) is set to report its Q1 2017 earnings on January 25th. (Fiscal years end with September.) Going by the company’s guidance for the quarter, its revenues and earnings per share in the quarter have likely increased by 6% and 20%, respectively. Further, we can expect the QTL revenues to have increased moderately because of an increase in the total reported device sales, which have likely increased by 2% on a year-over-year basis and declined by 16% sequentially at the midpoint of the guidance range. The sequential decline in reported device sales is primarily because of the catch-up payments resulting from the new license agreements that the company signed in its fiscal fourth quarter. Furthermore, we can expect the company’s MSM shipments to increase by 2% sequentially and decline by 11% on a year-over-year basis. The sequential increase can be attributed to a seasonally strong demand. In the table below, we note the key metrics as expected for Qualcomm in Q1’17:

Screen Shot 2017-01-20 at 1.46.03 PM

Qualcomm Witnessed A Healthy Growth In 2016

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Qualcomm ended 2016 on a strong note, as its stock price increased by more than 40% in the year. The company saw a healthy growth in its revenue and earnings in Q3’16 and Q4’16. Even the Samsung Note 7 disaster had a minimal impact on the company’s results because of the strong adoption of Snapdragon 820 chipset in more than 150 smartphone designs. Furthermore, the company announced the acquisition of NXP Semiconductors, which will significantly diversify Qualcomm’s offering and provide it an entry into multiple markets outside its core mobile chipset business. However, lately, the company has been cited for abuse of its market dominance in South Korea by the Korean Fair Trade Commission(KFTC). The KFTC has now outlined a complete procedure, which Qualcomm will have to obey while negotiating licensing agreements with other chipset manufacturers. And just in the past week, both the US FTC and Apple have file suits alleging similar charges.

 

For more details about recent events related to the company read our following articles:

What Does The KFTC Ruling Imply For Qualcomm?

Opportunity For Qualcomm Could Be A Setback For Intel

Qualcomm-NXP Semiconductors Could Create A Behemoth In The Automotive Semiconductor Space

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