Qualcomm Shares Drop on Disappointing Fourth-Quarter Profit Outlook
Qualcomm Inc. (NASDAQ:QCOM) reported third-quarter results that beat revenue expectations but missed earnings forecasts, with adjusted EPS of $2.21 falling short by $0.02 against analysts' estimates. The company's stock fell more than 5% in premarket trading due to weaker-than-expected profit guidance for the fourth quarter. Qualcomm forecast Q4 adjusted EPS between $2.05 and $2.25, with a midpoint of $2.15 below Wall Street’s consensus estimate of $2.35. Revenue is expected to range from $9.7 billion to $10.5 billion, with the midpoint exceeding estimates but not alleviating concerns over profitability. The company's QCT division saw mixed results: handset revenue dropped 20%, while automotive and IoT segments grew significantly. However, higher manufacturing costs are pressuring margins as Qualcomm attempts to pass these increases on to customers.