In its Q3 FY 2023 report, Qualcomm (NASDAQ:QCOM) announced earnings per share of $2.02, surpassing the $1.91 estimate. The company's revenue of $8.67 billion also exceeded the expected $8.52 billion by $150 million, despite a 24% year-over-year (YoY) decrease in sales. In after-hours trading following the report, Qualcomm's shares saw an uptick.
The report detailed a 27% decline in Handset Chip sales to reach $5.46 billion, beating the projected $5.34 billion. Licensing sales fell by 12% to reach $1.26 billion. However, the Automotive segment bucked the trend with a 15% growth to secure $535 million in revenue.
For Q4 FY 2023, Qualcomm projects revenues between $9.1 billion and $9.9 billion and earnings per share from $2.25 to $2.45. Over the past three months, analysts have assigned Qualcomm stock with 12 Buys, 3 Holds, and 1 Sell rating, with a price target of $134.67, indicating a 21.49% upside potential.
This follows the company's Q4 2023 performance where it recorded a YoY decrease in earnings and revenues across both its QCT and QTL segments, leading to a 24% reduction in revenues to $8.63 billion and a drop in net income to $1.49 billion or $1.32 per share from $2.87 billion or $2.54 per share in the previous year's quarter.
Despite this downturn, Qualcomm's results surpassed analysts' expectations and CEO Cristiano Amon asserted Qualcomm's technological leadership at the Snapdragon Summit, fostering a positive outlook for the company moving forward.
InvestingPro Insights
In light of the recent Q3 FY 2023 report, InvestingPro offers two key insights that could further shed light on Qualcomm's financial performance.
InvestingPro Tip 1: Qualcomm has consistently maintained its dividend payments for 21 consecutive years, a testament to its financial stability and commitment to shareholder returns. This aligns with the company's Dividend Yield of 2.89% as of 2023.
InvestingPro Tip 2: Qualcomm operates with a high return on assets, as evidenced by a 17.94% return on assets in the last twelve months as of Q3 2023. This suggests efficient use of its assets to generate profits.
InvestingPro Data: Qualcomm's market capitalization stands at $123.75 billion, indicating its significant size and influence in the market. The company's P/E ratio is 14.34, which is slightly lower than the adjusted P/E ratio of 12.33 in the last twelve months as of Q3 2023. This suggests that the company's earnings growth might be slowing down. Furthermore, Qualcomm's revenue in the last twelve months as of Q3 2023 was 38.58B USD, despite experiencing a decrease in revenue growth of -8.44%.
For more in-depth analysis and additional tips, consider exploring InvestingPro's comprehensive financial tools.
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