Qualcomm rides solid quarterly earnings

Qualcomm Inc.’s shares jumped briefly after the company reported increases in both its net income and revenues during its first fiscal quarter of 2007, but its stock price quickly dropped down to a steady $38.46 per share after the news.
Analysts largely hailed the company’s solid performance, noting that Qualcomm appears primed to cash in on the world’s move to third-generation networks. As for the company’s chip business specifically, analysts also cheered its recent win of Motorola Inc. as a customer.
“We see shipments climbing once Motorola incorporates Qualcomm as a 3G chipset supplier,” wrote Ittai Kidron, an analyst with CIBC World Markets. The firm makes a market in Qualcomm securities.
As for Qualcomm’s results, the company’s net income grew 5 percent to $648 million during over the same quarter a year ago. The company’s revenues were up 16 percent to $2.02 billion over the same period last year. Analysts had expected Qualcomm to report revenues of $2.07 billion.
“Our results this quarter were driven by record 3G handset and chipset shipments,” said Paul Jacobs, Qualcomm’s CEO.
Qualcomm reaffirmed its 2007 forecast based on its current outlook for CDMA-based handset shipments. The company expects to record between $2 billion and $2.1 billion in revenues during the second quarter and between $8.1 billion and $8.6 billion for the full year. Analysts polled by Thomson Financial Network have forecasted the company’s revenues for the coming quarter at $2.1 billion and $8.55 billion for the year.