Qualcomm and Arm Holdings Beat Expectations, Raise Guidance

Qualcomm beat earnings expectations and showcased progress on its new artificial intelligence accelerator chips and servers, which it expects will deliver material revenue by 2027.

Qualcomm reported adjusted earnings of $3.00 a share for its fiscal fourth quarter, with revenue up 10% to $11.27 billion. (Photo: Qualcomm)

The company’s challenge is convincing customers to switch from industry leader Nvidia, Adam Levine and Tae Kim reported for Barron’s Daily.

Qualcomm reported adjusted earnings of $3.00 a share for its fiscal fourth quarter, with revenue up 10% to $11.27 billion. Chip revenue hit $9.8 billion, with all three segments—smartphone, automotive, and internet-of-things—beating estimates.

The company guided first-quarter earnings of $3.30 to $3.50 a share and revenue of $11.8 billion to $12.6 billion, exceeding Wall Street forecasts.

However, expense growth outpaced expectations, and automotive chip sales remained soft.

Separately, Arm Holdings also surpassed estimates, reporting adjusted September-quarter earnings of 39 cents a share on revenue up 34% to $1.14 billion.

The UK-based chip designer forecast current-quarter revenue at about $1.225 billion. Arm’s latest Armv9 architecture commands higher royalties than its earlier Armv8 design and is gaining traction in the cloud server processor market.