Qualcomm announces the fiscal results of the third quarter of the 2023 financial year

Qualcomm has revealed the fiscal results of the third quarter of the 2023 financial year up until June 25, illustrating revenues reaching $8.44 billion, a decline of 23% in comparison to the same period in the preceding year. Net profit amounted to $1.8 billion, a staggering 52% decrease from last year’s equivalent quarter. Mobile chip sales contributed $5.26 billion to this sum, marking a drop of 25% year over year.

Qualcomm attributes this downturn to the industry-wide reduction in the expenditure on crucial mobile components and an overall slump in mobile market demand. The company even forecasts an exacerbated decline in future smartphone shipments.

Nonetheless, Qualcomm remains optimistic about the revival of mobile market demand during the end-of-year holiday shopping season. It cites the current lack of consumer enthusiasm for device upgrades as a primary cause leading to the universal downsizing of product shipments by mobile companies.

In contrast to the $7.17 billion revenue of the Qualcomm Technologies (QCT) department, primarily fueled by mobile chip sales in the previous quarter, the mobile chip business only made up $5.26 billion. Qualcomm’s automotive business revenues hit $434 million in the last quarter, a 13% increase from the same period last year. However, the Internet of Things business revenues were $1.48 billion, a decline of 24% from last year, and the revenue from the technology licensing business was $1.23 billion, a 19% drop year-over-year.

CEO Cristiano Amon has outlined Qualcomm’s future development axis to focus more on the integration of artificial intelligence technologies. This includes enabling users to run AI models on devices equipped with Qualcomm processors, thereby propelling the development of more substantial edge computing. It allows more computation to be accomplished at the device end rather than the cloud, enhancing overall computational efficiency while also ensuring personal privacy.

In light of the uncertainties in the upcoming market development, Qualcomm has confirmed that it will adjust costs through measures, including layoffs, and alerted investors of the potential for significant funds to be allocated to organizational restructuring. Furthermore, it anticipates more cost-cutting plans to be implemented in the first half of the next year.