Qualcomm trots out familiar tune in Q3: upbeat

Qualcomm sign
Qualcomm is on pace to deliver $10 billion of annual revenues across RF front-end, IoT and automotive. (FierceWireless)

Qualcomm focused on a familiar theme during its fiscal third-quarter earnings call: diversifying beyond phones in the 5G era.

The company, just coming off a quarter where revenues of $8.1 billion exceeded expectations, is expanding its portfolio to include cars, the enterprise, smart factories, the home, wearables and more.

Qualcomm is on pace to deliver $10 billion of annual revenues across RF front-end, IoT and automotive as it continues to diversity its business, said President and CEO Cristiano Amon.

For the third quarter, Qualcomm reported a 65% year-over-year increase in revenues. Earnings per share of $1.92 beat average estimates of $1.67.

“We are at the forefront of enabling this new ecosystem and also making 5G for industrial applications a reality,” he said, according to an earnings call transcript. “We are becoming the connected intelligent edge partner of choice.”

RELATED: Qualcomm’s Amon looks beyond mobile with 5G, edge and cloud

Qualcomm’s automotive design win pipeline has reached about $10 billion, and based on its third-quarter results, its annualized automotive revenue run rate is now over $1 billion, he said.

As for handsets, which represent a more traditional segment for the company, Qualcomm reported that it’s seeing strong traction in its Snapdragon Series 7 mobile platform, with nearly 40 new devices shipped or announced during the last quarter. “Snapdragon premium and high-tier solutions remains synonymous with Android flagship mobile experiences,” he said.

IoT revenues grew 83% year over year, to $1.4 billion, an increase of about $100 million over what the company had guided.

Earlier this week, Intel announced Qualcomm and Amazon as it first major customers for its new Intel Foundry Services business. Plans call for Qualcomm to have chips manufactured by Intel in coming years.

Concerns about Apple’s plans

Asked about Apple’s work on its own modem that would replace Qualcomm’s, Amon responded that “we’re very happy with our relationship with Apple,” noting that it was just awarded a multi-year agreement with the iPhone maker. “We have other phones to go, and we’re very happy with the way things are progressing.”

RELATED: Apple sees the chip crunch hitting popular iPhones

Qualcomm always has been focused on cellular technology and first with every new generation of wireless. As long as the modem continues to be relevant, “there’s always going to be a place for Qualcomm in this business,” he said.

Addressing investor concerns, he said: “The biggest opportunity for Qualcomm in mobile is the changes that are happening in the mobile landscape right now. As a matter of fact, this quarter, Xiaomi is the No. 2 OEM in award and shipments, and we see this shift in OEM market share create an incredible opportunity for us. Snapdragon became synonymous with Android premium and high tier. That is how we’re going to go faster than the market and incredible opportunity for revenue and earnings, looking at the whole value of the Snapdragon platform.”

RELATED: Qualcomm posts ‘exceptional’ Q4, rides 5G wave

For the full calendar year 2021, Qualcomm is forecasting high single-digit growth for global 3G, 4G and 5G handsets, including 450 million to 550 million 5G handsets. For the fourth fiscal quarter, it’s forecasting revenues of $8.4 billion to $9.2 billion and earnings per share of $2.15 to $2.35.