Qualcomm (QCOM 4.27%)a leader in wireless networking technology, announced its fourth quarter fiscal 2024 results on November 6, 2024.

The company reported GAAP revenue of $10.244 billion, well above the upper range of its guidance of $9.5 billion to $10.3 billion. Non-GAAP diluted earnings per share (EPS) came in at $2.69, beating expectations of $2.45 to $2.65.

This performance reflects strong momentum in key sectors, although the quarter also highlighted ongoing challenges.

Source: Expectations based on management guidance as provided in the 07/31/2024 earnings report.

Company Overview

Founded in 1985, Qualcomm plays a central role in the development and commercialization of wireless technologies, including critical advancements from CDMA to 5G. It has two main segments: Qualcomm CDMA Technologies (QCT) and Qualcomm Technology Licensing (QTL). QCT focuses on semiconductor products and system software, while QTL focuses on licensing its intellectual property portfolio.

Qualcomm’s recent activities have focused on diversifying its revenue streams. This involves significant investments in the automotive and Internet of Things (IoT) sectors. This diversification aligns with its strategy to capitalize on technological advancements beyond mobile, thereby enhancing the company’s long-term growth potential.

Quarterly achievements

During the quarter, the QCT segment achieved revenue of $8.678 billion, an increase of 18% from the previous year. This is due to the demand for automotive solutions, part of the Snapdragon Digital Chassis platform. Automotive revenues jumped 68% year-over-year, setting a new consecutive quarterly record. This demonstrates Qualcomm’s strategic focus on expansion in the automotive industry.

Meanwhile, the QTL segment reported revenue of $1.521 billion, a solid 21% year-over-year increase. This strong performance highlights the strength of Qualcomm’s intellectual property portfolio and the continued demand for 5G technology, despite external pressures from legal disputes and trade tensions.

However, IoT revenue was down 9% from last year, indicating an area for improvement. The integration of artificial intelligence and edge computing within its solutions is expected to provide a platform for growth as the market recovers.

Qualcomm continues to face legal and business challenges, including its legal dispute with Arm holds. The outcome could potentially impact future licensing revenues. Despite these issues, Qualcomm’s financial position remains strong with significant growth opportunities in place.

Look forward to

Looking ahead, Qualcomm is showing an optimistic outlook for the first quarter of fiscal 2025, forecasting revenue between $10.5 billion and $11.3 billion. Non-GAAP EPS is expected to be between $2.85 and $3.05. This outlook depends on continued momentum in its key segments, bolstered by further advancements in automotive and IoT.

Investors should monitor Qualcomm’s legal proceedings and strategic responses to global trade dynamics. Its leadership in driving 5G advancements, as well as exploring 6G opportunities, remains critical to its success. With its upcoming Investor Day, Qualcomm could offer additional insight into how it plans to handle these upcoming opportunities and challenges.