Qualcomm Announces First Quarter Financial Report for Fiscal Year 2023

Qualcomm announced its financial report for the first quarter of the fiscal year 2023 (ended December 25, 2022), with quarterly revenue of $9.463 billion, a decrease of 12% from $10.705 billion in the same period of the previous fiscal year; net profit was $2.235 billion, a decrease of 34% from $3.399 billion in the same period of the previous fiscal year; diluted earnings per share were $1.98, a decrease of 34% from $2.98 in the same period last fiscal year. Regardless of revenue, net profit, or diluted earnings per share, it was lower than expected.

Qualcomm said that the decline in demand for smartphones, the deterioration of the macroeconomic environment, and the increase in channel inventory have affected the company’s performance. According to statistics from research institutions, global smartphone shipments in the fourth quarter of 2022 fell by 18% year-on-year, the largest decline in history, which obviously had a huge impact on Qualcomm.“In a challenging environment, we delivered results consistent with guidance, including year-over-year growth in QCT Automotive and IoT,” said Cristiano Amon, President, and CEO of Qualcomm Incorporated. “The long-term trends driving demand for our differentiated technologies and solutions that enable digital transformation are intact. We are confident in our ability to navigate the near term and remain focused on executing our diversification strategy.”

Qualcomm does not think the situation will improve in the first half of 2023, saying that the weak demand for mobile phones and Internet of Things products is expanding, and channel inventory levels are expected to continue to rise, which means that the situation will not improve much in the short term. Compared with the high-end mobile phone market, the demand in the low-end mobile phone market is weaker. Qualcomm expects to wait until at least the middle of 2023, after the customer’s destocking work is over, before it can better predict the trend in the second half of the year, and the market may pick up.

Qualcomm expects revenue in the second quarter of fiscal 2023 to be between $8.7 billion and $9.5 billion, which corresponds to diluted earnings per share of between $1.53 and $1.73, both below analysts’ expectations.