10-QPeriod: Q1 FY2025

QUALCOMM INC/DE Quarterly Report for Q1 Ended Dec 29, 2024

Filed February 5, 2025For Securities:QCOM

Summary

Qualcomm Inc. (QCOM) reported strong financial results for the first quarter of fiscal year 2025, with total revenues reaching $11.7 billion, a 17% increase year-over-year. Net income also saw a substantial rise of 15% to $3.2 billion. This growth was primarily driven by a robust performance in the QCT (Qualcomm CDMA Technologies) segment, which experienced a 20% revenue increase due to higher shipments and average selling prices in handsets, alongside significant growth in automotive and IoT sectors. The company's licensing division, QTL, also contributed positively with a 5% revenue increase. Qualcomm continues to return value to shareholders, demonstrating this through ongoing stock repurchase programs and an increased dividend payout. Despite the positive financial performance, the company faces ongoing risks including intense competition, customer vertical integration, and geopolitical tensions, particularly concerning U.S./China relations, which are detailed in the risk factors section.

Financial Highlights

46 data points
Beta

Revenue

$11.67B

55.8% Gross Margin

Net Income

$3.18B

27.3% Net Margin

EPS (Diluted)

$2.83

Total Assets

$55.58B

Cash & Equivalents

$8.71B

Free Cash Flow

$4.59B

Financial Statements
Beta
Revenue$11.67B
Cost of Revenue$5.16B
Gross Profit$6.51B
R&D Expenses$2.23B
SG&A Expenses$723.00M
Operating Expenses$8.11B
Operating Income$3.56B
Interest Expense$163.00M
Net Income$3.18B
EPS (Basic)$2.86
EPS (Diluted)$2.83
Shares Outstanding (Basic)1.11B
Shares Outstanding (Diluted)1.12B

Key Highlights

  • 1Total revenues increased 17% year-over-year to $11.7 billion.
  • 2Net income rose 15% year-over-year to $3.2 billion.
  • 3QCT segment revenue grew 20% driven by strong handset, automotive, and IoT performance.
  • 4QTL segment revenue increased 5% year-over-year.
  • 5Operating income was $3.6 billion, up from $2.9 billion in the prior year.
  • 6The company repurchased $1.8 billion of its common stock and paid $942 million in dividends during the quarter.
  • 7Diluted EPS was $2.83, an increase from $2.46 in the prior year.

Frequently Asked Questions

Qualcomm's revenue growth was primarily driven by its QCT (Qualcomm CDMA Technologies) segment, which saw a 20% increase year-over-year. This growth was fueled by higher handset revenues due to increased chipset shipments and average selling prices, as well as significant growth in automotive and IoT sectors. The QTL (Qualcomm Technology Licensing) segment also contributed with a 5% revenue increase.

Qualcomm continues to focus on returning capital to shareholders through its stock repurchase program and dividend payments. In the first quarter of fiscal year 2025, the company repurchased $1.8 billion of its common stock and paid $942 million in cash dividends. The company also announced an increased quarterly dividend of $0.85 per share.

Qualcomm identifies several key risks, including significant revenue concentration with a few customers and licensees, particularly in the premium-tier handset market. The company also faces risks from customers vertically integrating their operations, intense competition, U.S./China trade tensions and national security policies, and ongoing legal and regulatory challenges related to its licensing practices. Dependence on third-party suppliers and supply chain disruptions are also noted risks.

Qualcomm anticipates continued growth driven by 5G, high-performance computing, and on-device AI, extending into automotive and IoT markets. The company expects transitions to new process technology nodes to drive product cost increases. Competition remains intense, with ongoing concerns about vertical integration by customers and geopolitical tensions impacting business prospects.