Qualcomm revenue bts Street, shares up
Qualcomm Inc posted quarterly earnings and revenue that blew past Wall Street expectations and sent its shares up 8 percent as demand increased for chips used in devices such as the Apple Inc iPhone and it overcame a supply shortage.
The leading supplier of chips for cell phones also gave a bullish forecast for the current quarter and the year ahead, in stark contrast to bleak outlooks from other chip companies such as Texas Instruments and Intel Corp.
San Diego-based Qualcomm was helped by pent-up demand for its most advanced wireless chips after their sales were stunted earlier this year by a shortage of 28 nanometer manufacturing capacity.
Fourth-quarter sales were also boosted by the launch of the latest iPhone at the end of the quarter and the popularity of smartphones from Samsung Electronics Co.
Clearly Apple is playing a part here, as is Samsung, said Charter Equity Research analyst Ed Snyder.
However, Qualcomm, which is well ahead of rivals such as Broadcom Corp and Intel in developing chips for high-speed wireless devices, may start to see more pressure once its rivals bring out new products next year, Snyder said.
Even though he expects Qualcomm to have better products than newer offerings from its rivals, it will still see price pressure as phone makers want more than one supplier, said Snyder, who is also worried about worsening global economic conditions.
I think this is the peak. The air will slowly come out of the balloon in the next couple of
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