Qualcomm reports strong Q4 results, shares jump

Qualcomm's revenue for the quarter was $6.5 billion, up 35% year-over-year.

Qualcomm published its fourth quarter financial results on Wednesday, handily beating market estimates. The tech giant reported Q4 non-GAAP earnings per share of $1.45, an increase of 86% year-over-year. Revenue for the quarter was $6.5 billion, up 35% year-over-year.

Analysts were looking for earnings of $1.17 per share on revenue of $5.94 billion. Shares of Qualcomm were up over 6% after hours.

Fourth quarter revenues from the QCT (Qualcomm CDA Technologies) segment, which accounts for most of Qualcomm's revenue, came to $4.97 billion, up 38%. Qualcomm said handsets accounted for the bulk of Q4 sales, with revenue of $3 billion. Within QCT, MSM chip shipments in Q4 reached 162 million. Qualcomm noted that, beginning in fiscal 2021, it will no longer provide MSM chip shipment guidance or actual results.

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The company's other business segment, Qualcomm Technology Licensing (QTL), its licensing division, came to $3.43 billion, up from $1.2 billion a year ago. QTL accounts for a significant portion of Qualcomm's earnings.

In prepared remarks, Qualcomm CEO Steve Mollenkopf credited the company's momentum in 5G and its licensing business for the strong results. 

"Our fiscal fourth quarter results demonstrate that our investments in 5G are coming to fruition and showing benefits in our licensing and product businesses," said Mollenkopf. "We concluded the year with exceptional fourth quarter results and are well positioned for growth in 2021 and beyond. As the pace of disruption in wireless technology accelerates, we will continue to drive growth and scale across our RF front-end, Automotive and IoT adjacencies."

In terms of guidance, Qualcomm expects fiscal first quarter earnings from $1.95 to $2.15 a share with between $7.8 billion and $8.6 billion in revenue. Wall Street is expecting earnings of $1.68 a share on revenue of $7.13 billion. Qualcomm expects QCT revenues between $6.2 billion to $6.8 billion, and QTL revenues between $1.6 billion and $1.8 billion. 

"Qualcomm had an incredible Q4 and an equally impressive guide," noted tech analyst Patrick Moorhead. "The company also broke out its "growth areas" giving investors a deeper understanding of its opportunities in RFFE, automotive and IoT. In a big surprise, it appears that Qualcomm's RFFE business is one of the largest, near Qorvo, Skyworks and Broadcom levels. Another shocker was that its automotive business is larger than NVIDIA's. Qualcomm is finally, fully taking advantage of its 5G and growth area investments and, based on its guide, the growth will just continue. I don't believe the full "Apple" impact has been baked in yet, which should be upside for the company."