The 10-second takeaway
For the quarter ended March 25 (Q2), Qualcomm beat expectations on revenue and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share increased significantly.
Gross margin dropped, operating margin contracted, and net margin expanded.
Qualcomm reported revenue of $4.94 billion. The 36 analysts polled by S&P Capital IQ predicted net sales of $4.80 billion on the same basis. GAAP reported sales were 28% higher than the prior-year quarter's $3.87 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $1.01. The 32 earnings estimates compiled by S&P Capital IQ averaged $0.96 per share on the same basis. GAAP EPS of $1.28 for Q2 were 117% higher than the prior-year quarter's $0.59 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 63.9%, 870 basis points worse than the prior-year quarter. Operating margin was 30.6%, 640 basis points worse than the prior-year quarter. Net margin was 45.1%, 1,930 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $4.73 billion. On the bottom line, the average EPS estimate is $0.88.
Next year's average estimate for revenue is $19.35 billion. The average EPS estimate is $3.77.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 2,303 members out of 2,440 rating the stock outperform, and 137 members rating it underperform. Among 540 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 515 give Qualcomm a green thumbs-up, and 25 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 $69.56.
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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.