10-QPeriod: Q3 FY2024

QUALCOMM INC/DE Quarterly Report for Q3 Ended Jun 23, 2024

Filed July 31, 2024For Securities:QCOM

Summary

QUALCOMM Inc./DE (QCOM) reported a strong third quarter for fiscal year 2024, with total revenues increasing by 11% year-over-year to $9.39 billion and net income rising by 18% to $2.13 billion. This growth was primarily driven by a robust performance in the QCT (Qualcomm CDMA Technologies) segment, which saw a 12% revenue increase, bolstered by higher handset and automotive revenues. The QTL (Qualcomm Technology Licensing) segment also contributed positively with a 3% revenue increase. Despite global economic uncertainties and intense competition, QUALCOMM demonstrated solid operational execution. The company's balance sheet remains strong, with total assets of $52.74 billion and total stockholders' equity of $24.67 billion as of June 23, 2024. The company continued its capital return program, repurchasing shares and paying dividends, indicating confidence in its financial health and future prospects. Investors should note the ongoing legal proceedings and risk factors disclosed, particularly those related to supply chain dependencies, geopolitical tensions, and competition, which are critical considerations for evaluating the company's long-term outlook.

Financial Highlights

48 data points
Beta

Revenue

$9.39B

55.6% Gross Margin

Net Income

$2.13B

22.7% Net Margin

EPS (Diluted)

$1.88

Total Assets

$52.74B

Cash & Equivalents

$7.77B

Free Cash Flow

$3.05B

Financial Statements
Beta
Revenue$9.39B
Cost of Revenue$4.17B
Gross Profit$5.22B
R&D Expenses$2.26B
SG&A Expenses$664.00M
Operating Expenses$7.17B
Operating Income$2.22B
Interest Expense$168.00M
Net Income$2.13B
EPS (Basic)$1.91
EPS (Diluted)$1.88
Shares Outstanding (Basic)1.12B
Shares Outstanding (Diluted)1.13B

Key Highlights

  • 1Total revenues increased 11% year-over-year to $9.39 billion in Q3 FY24.
  • 2Net income grew 18% year-over-year to $2.13 billion in Q3 FY24.
  • 3QCT segment revenue increased 12% driven by higher handset and automotive sales.
  • 4QTL segment revenue increased 3% driven by higher estimated sales of 3G/4G/5G-based multimode products.
  • 5Diluted earnings per share (EPS) were $1.88 in Q3 FY24, up from $1.60 in Q3 FY23.
  • 6The company has $2.3 billion remaining under its $10 billion stock repurchase program.
  • 7QUALCOMM paid $2.7 billion in dividends for the first nine months of fiscal 2024.

Frequently Asked Questions

The primary drivers of revenue growth were the QCT (Qualcomm CDMA Technologies) segment, which saw a 12% increase due to higher handset and automotive revenues, and the QTL (Qualcomm Technology Licensing) segment, which experienced a 3% increase driven by higher estimated sales of 3G/4G/5G-based multimode products. Total revenues reached $9.39 billion, up 11% year-over-year.

QUALCOMM continues to return capital to shareholders through stock repurchases and cash dividends. As of June 23, 2024, approximately $2.3 billion remained authorized under its $10 billion stock repurchase program. The company announced a cash dividend of $0.85 per share, payable in September 2024. For the first nine months of fiscal 2024, the company paid $2.7 billion in dividends.

Key risks and challenges include significant customer and licensee concentration, intense competition, the risk of customers vertically integrating their operations, geopolitical tensions (especially U.S./China trade relations), supply chain dependencies, and ongoing legal and regulatory proceedings. The company also faces risks associated with extending its technologies into new markets like automotive and IoT, and potential product defects or cybersecurity vulnerabilities.

The company expects certain IoT customers, primarily in edge networking, to continue drawing down their inventory levels, which will negatively impact IoT revenues in the near term. This is due to elevated inventory levels at these customers.