One chip firm not blaming Japan for poor results this quarter is Qualcomm Inc., which beat the street with better than expected quarterly results and a revised optimistic prediction for full-year financial targets.
The firm posted net earnings of $999 million, or 59 cents per share, for its fiscal Q2, while Qualcomm’s revenue shot up a whopping 46% to $3.88 billion. The company had earlier projected a conservative $3.45 billion to $3.75 billion in revenue.
The chip maker also raised its fiscal 2011 revenue target to between $14.1 billion and $14.7 billion from previous predictions of $13.6 billion to $14.2 billion and raised expectations for 2011 earnings per share, putting them in the range of $2.51 to $2.59 up from $2.32 per share to $2.46 per share.
The wireless giant saw its shares shoot up 5% after announcing its strong results, claiming they were caused by ever-increasing demand for higher-end phones using the firm’s chips and that worries over Japan having an effect on the market were overblown.
Qualcomm generated 9% of its revenue from Japanese markets last year, but Executive VP Steve Mollenkopf told analysts on an earnings call he didn’t believe it was “a huge situation right now compared to what people think about in terms of Japan.”
“The impact we’re able to see from our vantage point doesn’t seem to equate to the level of investor anxiety we’ve been seeing,” Qualcomm’s CFO William Keitel added.
Having said that, the firm did admit that some of its customers were having supply issues in Japan, but said should they overcome these issues, it would result in higher chip sales.
“Demand for smartphones across an array of geographies and tiers continues to grow,” CEO Paul Jacobs said.
Indeed, so does the demand and total market for 3G devices, which also gives Qualcomm a boost, as the company makes rather a lot of its profit from licensing patents based on its 3G technology. Average smartphone prices would also increase, predicted Qualcomm, saying it expected to see phones being sold in the $199 to $209 price range.
Qualcomm’s growth this quarter was helped along by the launch of the first Apple Inc. iPhone using Qualcomm chips, being sold by Verizon Wireless. China is also thought to have been a factor in the firm’s strong growth this quarter.
The company said it shipped a record-breaking118 million mobile station modem chips in Q1, up 27% from Q110 and flat sequentially. The company also predicted shipments to be in the range of 115 million to 119 million in the third quarter, up 12% to 16% from the previous year.
In addition, Qualcomm settled a licensing dispute with Panasonic Mobile Communications Co., which added an extra $401 million to Q2 results.
