Qualcomm's second-quarter earnings came in stronger-than-expected, thanks to strong sales of its mobile chips, but guidance was exceptionally weak.
NEW YORK (TheStreet) --Qualcomm(:QCOM) shares are down sharply in after-hours trading after the chip maker offered noticeably weak third-quarter guidance.
The San Diego-based firm, which supplies chips to handset makers such as Apple(:AAPL), Samsung and others, reported earnings, excluding items, of $1.01 a share on $4.94 billion in revenue. Analysts polled by Thomson Reuters expected Qualcomm to report earnings of 96 cents a share on $4.84 billion in revenue. Qualcomm reported second-quarter earnings after market close on Wednesday
Despite the solid earnings report, third-quarter guidance was exceptionally weak. Qualcomm said it expects third-quarter earnings to be between 83 cents and 89 cents a share. Revenue is expected to be between $4.45 billion and $4.85 billion. Analysts polled by Thomson Reuters expect earnings of 90 cents on $4.8 billion in revenue.
Qualcomm CEO Paul Jacobs was positive on the quarter, citing growth in 3G and 4G smartphones. "I am pleased to report another quarter of record revenues and earnings per share, driven by strong demand for 3G- and 4G-enabled devices across both developed and emerging regions," he explained, in a statement. "We are excited to see the continued growth of 3G and 4G smartphones, as well as new mobile computing devices. We are increasing our operating expenses to facilitate additional 28 nanometer supply and to continue to position our industry-leading chipset solutions for the opportunities ahead."
The chip maker ended the quarter with $26.6 billion in cash, up from $22.1 billion in the year ago quarter.
Shares of Qualcomm finished the regular session lower, down 0.27% to close at $67.05. In extended-hours trading, Qualcomm is lower by 5.6% to $63.30 according to Nasdaq.com.
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--Written by Chris Ciaccia in New York
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