Qualcomm Revenues Plummeted 24 Percent in Quarter, But Smartphone Slump is Stabilizing

Qualcomm reported a net income of $1.5 billion on revenues of $8.6 billion for the quarter ending September 24, 2023. Revenues were down a painful 24 percent year-over-year (YOY) but beat expectations. And the firm said that the chipset sales slump was over, and that the current quarter will be much improved.

“As we enter fiscal 2024, we are pleased with our roadmap and product execution, which position us well across our businesses,” Qualcomm president and CEO Cristiano Amon said. “Our recent Snapdragon Summit announcements underscore our technology leadership, establishing Qualcomm as a leader in on-device generative AI and mobile computing performance.”

Qualcomm earned $5.45 billion in revenues derived from its diverse lineup of smartphone chipsets, down 27 percent from the $7.4 billion it earned in the year-ago quarter. And revenues from IoT suffered a 31 percent drop-off to $1.38 billion. But Automotive revenues were up 15 percent to $535 million, and Qualcomm’s licensing business delivered another $1.26 billion in revenues (down 12 percent).

Qualcomm is highly dependent on a smartphone industry that’s been in decline for the past two years, since the end of the COVID-19 pandemic. But it reported that this decline is about to stabilize and return to growth.

“We are seeing early signs of stabilization in demand for global 3G, 4G, 5G handsets,” Qualcomm CFO Akash Palkhiwala said in the firm’s post-earnings conference call. He said that its YOY declines this year would be smaller than expected as a result.