Qualcomm (QCOM, Financial), the world's leading smartphone chip manufacturer, saw its stock price drop over 5% in pre-market trading after issuing a gloomy revenue forecast. The company anticipates revenue between $9.9 billion and $10.7 billion for the current fiscal quarter, slightly below the average analyst expectation of $10.33 billion. This has heightened concerns about the impact of tariffs on product demand and the potential effects of an impending trade war on the smartphone market.
CEO Cristiano Amon emphasized the company's focus on its leading technology, robust product portfolio, strong customer relationships, and operational efficiency amid current macroeconomic and trade challenges. Despite the tariff concerns, Qualcomm reported no substantial impact so far, but noted the indirect effects remain unpredictable.
For the third fiscal quarter, Qualcomm expects an adjusted earnings per share of around $2.70, surpassing Wall Street's forecast of $2.64. In the second fiscal quarter, the company reported a 17% revenue increase to $11 billion, with adjusted earnings per share of $2.85, beating analyst estimates.
Qualcomm continues to diversify beyond the smartphone market by expanding into automotive chips and launching processors for AI-powered laptops, aiming to reduce dependency on smartphone sales.
