Qualcomm Quarterly Profit Falls 44%, But Execs See Improvement Ahead

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Qualcomm headquarters in Mira Mesa. Photo via Wikimedia Commons

San Diego-based Qualcomm reported declines in revenue and earnings in its fourth fiscal quarter, but company officials said the results were “at the high end of our expectations” and see improvement ahead.

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The wireless communications giant reported earnings of $1.1 billion, or 67 cents per share, in the quarter ended Sept. 27, down 44 percent from $1.9 billion, or $1.11 per share, in the same quarter a year ago.

Revenues for the quarter totaled $5.5 billion, an 18 percent decline from the $6.7 billion reported a year ago.

“Our fiscal fourth quarter revenues and EPS were at the high end of our expectations, with stronger-than expected MSM chipset shipments offsetting slower than expected progress concluding new license agreements in China,” aid Steve Mollenkopf, CEO of Qualcomm.

The report was issued after the close of markets in New York, and the company’s shares were trading near $57 after hours, down nearly 6 percent from its Thursday closing price.

Mollenkopf noted that Qualcomm had returned a record $14 billion in capital to shareholders in the last fiscal year and said there are promising signs of improvement in the business.

“We are encouraged by customer reaction to our flagship Snapdragon 820, are on track to deliver on our fiscal 2016 cost reduction targets and expect to exit fiscal 2016 on an improving financial trajectory,” he said.

Results were down for the fiscal year as a whole. Net income of $5.3 billion, or $3.22 per share, was off 34 percent from the $8.0 billion, or $4.65 per share, earned in the previous year. Revenues fell 5 percent to $25.3 billion from $26.5 billion.

Qualcomm said that it would no longer issue annual revenue and earnings guidance, but continue to provide quarterly forecasts.

The global wireless technology company announced in July that it plans to lay off 15 percent of its global workforce and study a restructuring under pressure from hedge fund investor Jana Partners.

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