Despite its cost-cutting initiatives, adjusted earnings fell 20% to 80 cents per share,
but this was 5 cents higher than the average analysts’ estimate.
Steve Mollenkopf, CEO of Qualcomm, said, “We delivered another solid quarter operationally in the midst of slower demand for 4G devices as the market prepares for the global transition to 5G. “Our 5G design wins have doubled over the last three months, leaving us extremely well positioned as 5G ramps in early calendar year 2020.”
For the fourth quarter, the company expects further declines. It sees a 12-26% fall in revenues to $4.3 billion to $5.1 billion during this period. Adjusted EPS is projected to be $0.65 – $0.75, down 16-27% year-over-year.
The chipmaker is currently going through a highly volatile phase. The positive sentiment that followed the settlement of the patent case with Apple (Nasdaq: AAPL) was short-lived as the company suffered a setback after the Federal Trade Commission recently issued an anti-trust ruling against it.
READ: Apple Q3 2019 earnings call insights: iPhone takes back seat, Wearables grab the limelight
It is alleged that Qualcomm misused its dominant position in
the microprocessor industry and engaged in business practices that violated the
anti-competition rules. However, the market’s mood turned positive once again
after the Department of Justice recently issued a statement favoring the
company.
Qualcomm shares witnessed severe fluctuations this year,
marked by sharp gains prior to the last earnings report and the subsequent
retreat. The stock has gained 31% since the beginning of 2019 and 15% in the
past twelve months.
Last week, Intel (NASDAQ: INTC) reported a 2%
increase in second-quarter earnings to $1.06 per share, despite a decline
in revenues. A modest rise in the Data Center business was more than offset by
a sharp decline in client computing.