01—Abstract
Summary
Summary of the 10-Q filed July 31, 2024. Cited figures are marked; the original filing is the authoritative source.
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 billiona 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%b 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 billionc 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.
02—Key points
Key Highlights
- Total revenues increased 11% year-over-year to $9.39 billion in Q3 FY24.
- Net income grew 18% year-over-year to $2.13 billion in Q3 FY24.
- QCT segment revenue increased 12% driven by higher handset and automotive sales.
- QTL segment revenue increased 3% driven by higher estimated sales of 3G/4G/5G-based multimode products.
- Diluted earnings per share (EPS) were $1.88 in Q3 FY24, up from $1.60 in Q3 FY23.
- The company has $2.3 billion remaining under its $10 billion stock repurchase program.
- QUALCOMM paid $2.7 billion in dividends for the first nine months of fiscal 2024.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2024, Qualcomm Inc kept $0.23.
- Revenue$9.39B100.0%
- Cost of revenue−$4.17B44.4%
- Gross profit$5.22B55.6%
- Operating costs−$3.00B31.9%
- Operating income$2.22B23.6%
- Interest, other & tax−$92.0M1.0%
- Net income$2.13B22.7%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed July 31, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $9.39B$8.45B | +11.1% |
| Cost of Revenue | $4.17B$3.79B | +10.1% |
| Gross Profit | $5.22B$4.66B | +12.0% |
| R&D Expenses | $2.26B$2.22B | +1.7% |
| SG&A Expenses | $664.00M$618.00M | +7.4% |
| Operating Expenses | $7.17B$6.63B | +8.2% |
| Operating Income | $2.22B$1.82B | +21.8% |
| Interest Expense | $168.00M$172.00M | −2.3% |
| Net Income | $2.13B$1.80B | +18.1% |
| EPS (Basic) | $1.91$1.62 | +17.9% |
| EPS (Diluted) | $1.88$1.60 | +17.5% |
| Shares Outstanding (Basic) | 1.12B1.11B | +0.1% |
| Shares Outstanding (Diluted) | 1.13B1.12B | +0.9% |
05—Questions
Frequently Asked Questions
What were the main drivers of QUALCOMM's revenue growth in the third quarter of fiscal year 2024?
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.
How is QUALCOMM managing its capital returns to shareholders?
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.
What are the key risks and challenges highlighted in the filing?
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.
What is the outlook for the IoT segment?
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.
06—Continue