Qualcomm Inc. posts first-quarter profit, beats analysts’ estimates

The worlds largest mobile-phone chip manufacturer – Qualcomm Inc. posted fiscal first-quarter profit that beat analysts estimates, by which the company managed to prove beliefs that slowing smartphone growth would have an negative impact on earnings wrong.

Qualcomm Inc. made an official statement, explaining that its profit excluding some costs during the quarter that ended December the 29th was 1.26 dollars a share. According to some data compiled by Bloomberg, the analysts average expectations were for 1.18 dollars a share. A larger annual profit forecast was also made by the company. Qualcomms sales rose by 10% and reached 6.62 billion dollars, compared with analysts estimates for 6.68 billion dollars.

Thanks to the increasing customers demand for phones that use its technology to connect to high-speed data networks, such as the new long-term evolution systems, Qualcomm managed to increase its license revenue and chip sales. As reported by Bloomberg, smartphone market-share gains at Qualcomm customers such as Huawei Technologies Co. and Lenovo Group Ltd are helping bolster sales even as demand slows at industry leaders Apple Inc. and Samsung Electronics Co.

One of the analysts working for JMP Securities LLC – Alex Gauna, said for Bloomberg: “Appole had everybody prepared for things moving in the wrong direction, and they didnt. Apple is not the only customer out there. Samsung is not the only customer out there. Were starting to see the Samsung and LGs of tomorrow emerging out of China.”

Qualcomms net income for the first quarter of 2014 decreased by 2% from 1.9 to 1.88 billion dollars. The company forecasts a profit before certain costs of 5 ti 5.20 dollars a share for the current fiscal year. In November 2013, it predicted fiscal 2014 sales estimated to 26 to 27.5 billion dollars, which is a 5-to-11-percent-increase from the prior 12 months sales.

Paul Jacobs, who is a Chief Executive Officer of Qualcomm, said in a telephone interview cited by Bloomberg: “Theres more growth going forward that were projecting in the emerging regions. Around the world youre seeing consumers want to move to a higher-end device. People want to buy up.”

Mr. Jacobs also said that the company forecasts that emerging markets will grow about 20% compared with a gain of about 6% in developed regions. Chief Financial Officer of the company said on a conference call that Qualcomm also considers itself able to exceed its sales forecast for the year if the official launch of LTE in China proceeds quickly.

According to CNN Money, the current share price of Qualcomm Inc. is 1.21% down, and its one-year return rate is 4.22% down. The 37 analysts offering 12-month price forecasts for Qualcomm Inc. have a median target of 80.00, with a high estimate of 88.00 and a low estimate of 50.00. The median estimate represents a +12.49% increase from the last price of 71.12.