(Bloomberg) – Qualcomm Inc., the world’s largest seller of smartphone processors, traded late in investor fear that demand for new phones will stall next year.
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The company said Wednesday that revenue for the period ending in March will range from $10.3 billion to $11.2 billion. Of that, the company’s licensing business generates between $1.25 billion and $1.45 billion. This is compared to the average analyst forecast of $1.4 billion.
The outlook for the technology licensing business, based on forecasts of the number of mobile phones on sale, has raised some analysts question Qualcomm’s industry outlook.
Chief Financial Officer Akash Palkhiwala said the company expects the overall market to be flat or a single digit lower in 2025. That forecast does not include revenue from China-based Huawei Technologies Co., which is renegotiating its license with Qualcomm, executives said.
Qualcomm’s business outlook is consistent with Analyst Farm IDC, predicting global smartphone shipments will be “low single digits” in 2025.
The shares fell about 4% in extended trading after closing at $175.86 in New York. Stocks rose 14% this year.
Other smartphones, Stalwarts Arm Holdings Plc and Skyworks Solutions Inc., have been delayed in trading after making forecasts that were not reaching the forecasts of some analysts. The results of the company have raised investors concerns about the growth of the entire industry.
San Diego-based chip makers collect fees calculated as a percentage of the cost of mobile phones, regardless of whether the phone makers use chips or not. Qualcomm has established that it is possible to acquire these rights in intellectual property litigation around the world and claim royalties on patents that cover the basic way telephones connect with the network.
The overall smartphone market hasn’t grown as rapidly as it has in the past, but Qualcomm’s strength as a semiconductor provider for expensive devices such as the Galaxy Range from Samsung Electronics Co., will help drive growth . The company’s efforts to expand outside the central market are also expanding to automobiles and personal computers, which drive revenue.
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