By Stephen Nellis and Arsheeya Bajwa
SAN FRANCISCO (Reuters) -Chip designer Qualcomm on Wednesday forecast quarterly gross sales and revenue above market expectations as premium smartphone gross sales rebounded, however a potential lack of enterprise subsequent yr from Samsung, a key buyer, despatched its shares down after hours.
Qualcomm is among the many world’s largest suppliers of modem chips that join smartphones to wi-fi knowledge networks. For the present fiscal first quarter ending in December, Qualcomm stated it expects gross sales and adjusted revenue with a midpoint of $12.2 billion and $3.40 per share, above analyst estimates of $11.62 billion and $3.31 per share, based on LSEG knowledge.
For Samsung Electronics’ most up-to-date Galaxy S25 fashions, Qualcomm provided 100% of modem chips, however Qualcomm CEO Cristiano Amon instructed Reuters on Wednesday that Qualcomm was ready for a decrease share in Samsung’s subsequent era.
“When you consider Galaxy S26, we’re planning for 75% – that is what we count on,” Amon stated.
Qualcomm shares fell 2.7% in prolonged buying and selling on Wednesday. The inventory had risen practically 4% throughout common buying and selling.
The corporate has been increasing into different fields equivalent to laptops and cars, in addition to knowledge middle chips, after longtime buyer Apple has deliberate to considerably transition to its personal modems.
Amon instructed analysts on a convention name on Wednesday that the corporate was in discussions with a big AI computing firm to provide chips.
He instructed Reuters that the forecast and better-than-expected fourth-quarter outcomes had been pushed by a wave of customers upgrading midpriced smartphones to dearer units to deal with AI apps, with the market starting to divide between low-end units and the pricier premium units.
“You do not have something within the center,” he stated. “And that is form of a world phenomenon that is occurring in China, that is occurring in India. We proceed to see an growth of the premium tier.”
Buyers have been working to grasp how Apple’s transition to its personal modems will have an effect on Qualcomm’s enterprise. In a word to purchasers, Bernstein analyst Stacy Rasgon stated Apple is probably going utilizing its personal chips in its iPhone Air and iPhone 16e fashions however has remained with Qualcomm chips for iPhone 17 fashions, softening the blow to Qualcomm.
Apple, Samsung and China’s Xiaomi all nonetheless account for greater than 10% of Qualcomm’s income, Qualcomm stated in securities filings on Wednesday.
DISCUSSIONS WITH HYPERSCALER
Qualcomm final month introduced a brand new sequence of AI knowledge middle chips, saying that Humain, an AI agency based by Saudi Arabia’s sovereign wealth fund, will probably be a buyer. Amon stated on the convention name that Qualcomm is in discussions with one other massive buyer.
