Earnings per share surpassed expectations at $2.75 adjusted compared to the expected $2.37, while revenue stood at $9.92 billion adjusted against an expected $9.51 billion. Looking ahead, Qualcomm anticipates adjusted earnings for the current quarter to range between $1.73 and $1.93 per share, with revenue projected to fall between $8.9 billion and $9.7 billion. Consensus expectations were for earnings of $2.25 per share on $9.3 billion of revenue, according to LSEG.

During the quarter, net income increased by 24% to $2.77 billion, or $2.48 per share, compared to $2.24 billion, or $1.98 per share, in the previous year.

Qualcomm, renowned for its smartphone chip manufacturing, including modems and processors for high-end Android devices, is under the leadership of CEO Cristiano Amon. Under Amon’s direction, Qualcomm has expanded its chip technology into diverse markets such as PCs, cars, and virtual reality headsets, while continuing its significant role as a smartphone supplier, despite a global market slowdown over the past two years.

Despite market challenges, Qualcomm experienced a 16% year-over-year increase in handset chip shipments, totaling $6.69 billion during the December quarter, signaling a positive trend in the smartphone market following two years of decline. Qualcomm expects global handset sales to remain flat year over year.

Amon noted a stabilization in the Android market after a corrective period in 2023, expressing optimism for the future.

Notably, Qualcomm’s processors are featured in Samsung’s high-end Galaxy phones launched in January, with expectations for continued collaboration under a new deal. This partnership underscores Qualcomm’s enduring presence in the smartphone industry, dispelling concerns about Samsung developing its own chips.

Qualcomm has forecasted sales and adjusted profit for the current fiscal second quarter, ending in March, with a midpoint projection of $9.30 billion in sales and $2.30 per share in adjusted profit. This outlook contrasts with analyst estimates of $9.30 billion in sales and $2.25 per share in adjusted profit, as reported by data from LSEG.

As the leading supplier of chips to the smartphone market, Qualcomm navigates through challenges in an industry that experienced its lowest sales in a decade in 2023. While the smartphone sector shows signs of gradual recovery, Qualcomm faces competition from various fronts. Huawei and Samsung Electronics have been increasingly utilizing in-house chips in their phones, while Taiwan’s MediaTek poses a challenge to Qualcomm’s dominance in mid- and premium-tier Android devices.

Despite these challenges, Qualcomm secured a chip supply deal renewal with Apple last year. Additionally, the company is diversifying its portfolio by expanding into other markets, including personal computers. Partnerships with industry giants like Dell Technologies and Lenovo Group are expected to introduce laptops featuring Qualcomm chips claimed to be faster than Apple’s in-house processors.

In the fiscal first quarter, ending on December 24, Qualcomm reported sales and adjusted profit of $9.94 billion and $2.75 per share, respectively. These figures exceeded estimates of $9.52 billion in sales and $2.37 per share in adjusted profit, according to data from LSEG.