) reported mixed financial results for the fourth quarter of
fiscal 2013. Moreover, management provided a disappointing
financial outlook. As a result, in the aftermarket trade on
Nasdaq, the stock price of the company was down by $2.82 (4.04%)
Qualcomm is facing intense competition from
), which has been modifying its chipsets to suit the modern
mobile computing market. Competition is also likely to emanate
from formidable rivals like
). Qualcomm currently has a Zacks Rank #2 (Buy).
On a GAAP basis, quarterly net income from continuing
operations was $1,501 million or 86 cents per share compared with
$1,271 million or 72 cents per share in the year-ago quarter. In
the fourth quarter of fiscal 2013, adjusted (excluding special
items) earnings per share came in at 91 cents, significantly
below the Zacks Consensus Estimate of 96 cents.
Quarterly total revenue of $6,480 million was up 33% year over
year, surpassing the Zacks Consensus Estimate of $6,354 million.
Segment wise, Qualcomm CDMA Technologies businesses contributed
$4,457 million of revenues in the fourth quarter, up 42% over the
prior-year quarter. Quarterly EBT margin was 16%.
Qualcomm Technology Licensing generated $1,874 million in
revenues, up 19% year over year. Quarterly EBT margin was 87%.
Qualcomm Wireless & Internet segment generated $154 million,
down 4% year over year and EBT margin was 8%.
During the fourth quarter of fiscal 2013, Qualcomm shipped
approximately 190 million CDMA-based MSM chipsets, up 35% year
over year. This figure was far better than the company's guidance
of a mid-point of 176 million. Average selling price (ASP) of a
mobile handset with an in-built Qualcomm chipset during this
quarter was around $227 -$233.
Quarterly operating income was $1,588 million compared with
$1,235 million in the year-ago quarter. Gross margin was 58.1%
compared with 62.2% in the year-ago quarter. Quarterly operating
margin was 24.5% compared with 25.4% in the prior-year quarter.
In the reported quarter, the company returned $592 million (35
cents per share) to its shareholders in the form of cash
dividends and another $3.32 billion through buyback of 50.7
million shares of common stock.
During the fourth quarter of fiscal 2013, Qualcomm generated
$2,523 million of cash from operations compared with $1,409
million in the prior-year quarter. Free cash flow, in the
reported quarter, was $2,323 million against $1,159 million in
the year-ago quarter.
At the end of fiscal 2013, Qualcomm had $29,406 million of
cash and marketable securities and no outstanding debt on its
balance sheet compared with $26,837 million of cash and
marketable securities and no outstanding debt at the end of
First Quarter of Fiscal 2014 Financial
The first-quarter revenues are expected in the range of $6.3
billion - $6.9 billion. Its mid-point of $6.6 billion is well
below the current Zacks Consensus Estimate of $6,944 billion.
GAAP earnings per share are projected to be 92 cents - $1.02.
Non-GAAP earnings per share are likely to range between 97
cents - $1.07 including 13 cents per share of stock-based
compensation expense. Its mid-point of $1.02 is significantly
below the current Zacks Consensus Estimate of $1.17. Qualcomm is
expected to ship 195 million - 210 million MSM chipsets in the
first quarter of fiscal 2014.
Fiscal 2014 Financial Guidance
The fiscal 2014 revenues are expected within the range of $26
billion - $27.5 billion. Its mid-point of $26.75 billion is well
below the current Zacks Consensus Estimate of $27.62 billion.
GAAP earnings per share are likely to be between $4.25 -
Non-GAAP earnings per share are expected in the band of $4.44
- $4.64 including 51 cents per share of stock-based compensation
expense. However, its mid-point of $4.54 is higher than the
current Zacks Consensus Estimate of $4.45. ASP of mobile handset
with an in-built Qualcomm chipset during fiscal 2014 will be
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