Qualcomm’s earnings show the effects of slowing smartphone sales

Qualcomm (NASDAQ: QCOM:) is scheduled to report its first-quarter financial results after the market closes on Thursday, and the communications chipmaker’s report comes amid a flurry of business updates from some leading semiconductor companies.

Wall Street analysts currently expect Qualcomm ( QCOM ) to say it earned $2.35 per share, excluding one-time items, on revenue of $9.57 billion for the quarter ended in December. For its part, Qualcomm ( QCOM ) said it estimates it will earn between $2.25 and $2.45 per share on revenue of $9.2 billion to $10 billion.

In the prior period, Qualcomm ( QCOM ) earned $2.98 per share, excluding one-time items, on revenue of $10.7 billion.

Among the issues that will be discussed by analysts and investors will be what Qualcomm ( QCOM ) has to say about the state of the smartphone market. Smartphone shipments are expected to fall sharply in the last three months of 2022, and Qualcomm ( QCOM ) could see its sales hit due to a lack of smartphone sales.

Qualcomm ( QCOM ) said it is reducing shipments to one of its biggest customers, Apple ( AAPL ) , as it diversifies into automotive systems and other business areas. Cowen analyst Matthew Ramsay said in a research note that he believes Qualcomm ( QCOM ) “proactively removed a significant amount of the Apple modem” in its most recent analysis day, thus setting a “conservative floor” for its upcoming results. :

Alpha-seeking investor Stone Fox Capital said in a recent assessment of Qualcomm ( QCOM ) that its investors “need no longer to fear; [the company] losing Apple business.”

Wall Street analysts and the authors of Seeking Alpha both currently have consensus Buy ratings on Qualcomm ( QCOM ) stock. Search Alpha’s Quant System, which has historically outperformed the stock market, is more conservative and gives shares of Qualcomm ( QCOM ) a hold rating.