Qualcomm revenue pops 41% driven by Android phone chip sales

Qualcomm president and CEO Cristiano Amon speaks about Qualcomm’s digital chassis for automakers at a news conference during CES 2022 in Las Vegas, Nevada, January 4, 2022.

After the bell, the company reported second-quarter earnings that beat expectations and drove the stock up over 4% in extended trading.

Here is how Refinitiv consensus expectations were met by Qualcomm.

• EPS: $3.21, adjusted, versus $2.91 expected, up 69% year-over-year
• Revenue: $11.16 billion, adjusted, versus $10.60 billion expected, up 41% year-over-year
• QCT (chip sales): $9.55 billion versus $8.86 expected per StreetAccount, up 52% year-over-year
• QTL (technology licensing): $1.58 billion versus $1.55 expected per StreetAccount, down 2% year-over-year

In the third quarter, the company expects to make between $2.75 and $295) in earnings per share. The company's forecast is better than Wall Street expected.

Licensing technology for connecting to cellular networks is one of the ways in which Qualcomm makes most of its money. Its strong results on Wednesday came amid wider market skepticism about chip companies, which benefited from strong demand and limited supply during the Covid-19 pandemic.

Under CEO Amon, the company has emphasized to investors that it can be a chip provider for many additional markets and that it can be a different company than it is today.

The major chip markets grew during the quarter.

The biggest market for Qualcomm chips was Handset, which grew by over 50% on an annual basis to $6.33 billion, suggesting that a potential slowdown in smartphone sales in an inflationary environment has yet to hit the primaryAndroid chipmaker.

RF front-end, a business focused on selling a part that enables 5G connections, grew 28%.

The automotive market segment is still small in terms of sales, but the company is optimistic that it will grow in the future. $339 million in automotive sales was reported by the company. The revenue from Veoneer was not included in the March quarter.

The business that makes low-power and low-cost chips reported a 61% growth.

During the quarter, the company paid cash dividends of $764 million and bought back 951 million of its shares.