The 10-second takeaway
For the quarter ended Dec. 25 (Q1), Qualcomm beat expectations on revenues and earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share expanded.
Margins shrank across the board.
Qualcomm reported revenue of $4.68 billion. The 36 analysts polled by S&P Capital IQ expected net sales of $4.58 billion. Sales were 40% higher than the prior-year quarter's $3.35 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.97. The 32 earnings estimates compiled by S&P Capital IQ predicted $0.90 per share on the same basis. GAAP EPS of $0.81 for Q1 were 14% higher than the prior-year quarter's $0.71 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 62.5%, 630 basis points worse than the prior-year quarter. Operating margin was 33.1%, 410 basis points worse than the prior-year quarter. Net margin was 29.9%, 500 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $4.80 billion. On the bottom line, the average EPS estimate is $0.95.
Next year's average estimate for revenue is $19.23 billion. The average EPS estimate is $3.69.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,230 members out of 2,363 rating the stock outperform, and 133 members rating it underperform. Among 574 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 552 give Qualcomm a green thumbs-up, and 22 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Qualcomm is outperform, with an average price target of $65.58.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Qualcomm. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.