Qualcomm, the largest maker of smartphone processors, has issued a lacklustre revenue forecast for the current period, raising concerns that component shortages will negatively impact consumer demand by driving prices upward. This announcement led to a drop in the company’s shares during extended trading. Qualcomm projects sales of $US10.2 billion to $US11 billion ($14.6 billion to $16 billion) for the second quarter, which concludes in March. Profit is expected to be around $US2.55 a share, excluding specific items.
Analysts had anticipated higher figures, with average estimates of $US11.2 billion in revenue and $US2.89 a share in earnings, according to Bloomberg data. Qualcomm stated that while there is strong demand for high-end phones, some customers, particularly in China, are scaling back handset production due to shortages and increasing costs of memory chips.
Qualcomm specialises in designing and manufacturing semiconductors, software, and services related to wireless technology. It is best known for its Snapdragon processors, which are widely used in smartphones. While CEO Cristiano Amon is focused on diversifying Qualcomm into markets such as automotive, personal computers, and data centres, these newer ventures are not yet substantial enough to offset the downturn in the company’s primary smartphone market.
In after-hours trading, Qualcomm’s shares experienced a decline of approximately 9 per cent, following a closing price of $US148.89 in New York.
