Qualcomm Inc. shares fell more than 6% in after-hours trading after the company missed revenue expectations for its fourth quarter and issued guidance that came in below Wall Street targets. The results landed a day after Advanced Micro Devices Inc. posted an earnings beat, and on a day when the broader market climbed on U.S. election results. Arm Holdings Ltd. and GlobalFoundries Ltd. also reported, drawing more muted reactions from investors.
Qualcomm reported adjusted earnings of $2.17 per share on revenue of $10.44 billion, up 8% from a year earlier. Analysts had expected earnings of $2.16 per share on sales of $10.48 billion. For the current quarter, Qualcomm guided to earnings of about $2.25 per share at the midpoint on sales of $10.48 billion, short of the Street's targets of $2.27 per share and $10.48 billion.
The company's smartphone-dependent business weighed on results. Qualcomm's chip sales for handsets fell 26% to $5.14 billion, below the $5.21 billion analysts expected, as rising memory costs pushed handset makers to raise prices and dampened demand. Chief Executive Cristiano Amon has pushed to expand into AI data center chips, a segment that brought in $650 million in the quarter. Amon said Qualcomm has a supply constraint rather than a demand problem and reiterated a target of more than $5 billion in data center revenue by the end of fiscal 2027.
Qualcomm's automotive segment was a bright spot, with sales up 89% to $1.99 billion, ahead of the $1.66 billion consensus. Internet of Things revenue rose 4% to $1.88 billion, slightly above estimates. Its QTL licensing business posted $1.3 billion in revenue, down 7%, despite renewed agreements with Apple Inc., Transsion Inc. and Huawei Technologies Co. Ltd.
Arm reported adjusted earnings of 52 cents per share, beating the 48 cents analysts expected, on revenue that rose 27% to $1.44 billion, ahead of the $1.38 billion estimate. The chip design company, which licenses processor blueprints to customers including Apple, Samsung Electronics Co. Ltd. and Qualcomm, said its data center business drove growth, with royalties there doubling year over year. Arm guided to current-quarter earnings of 56 cents per share, plus or minus four cents, versus the 55-cent consensus, and revenue of $1.54 billion, plus or minus $50 million, just above the $1.52 billion target. Its stock was down 2% in late trading.
GlobalFoundries reported third-quarter adjusted earnings of 53 cents per share on sales of $1.9 billion, up 12% from a year earlier, topping analyst targets of 51 cents and $1.89 billion. The contract chipmaker attributed growth to demand from AI and data center customers and counted Qualcomm among its largest customers. For the current quarter, GlobalFoundries guided to earnings of 59 cents per share, plus or minus five cents, on revenue of about $2 billion, against Street targets of 57 cents and the same revenue figure. Its stock was flat after-hours.
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