Shares of Qualcomm (QCOM) surged in after-hours trading after the semiconductor and equipment giant announced its fourth-quarter earnings, which exceeded market expectations. The company reported earnings of $2.69 per share on revenue of $10.24 billion versus analysts’ predictions of $2.55 per share on revenue of $9.9 billion. Interestingly, QCOM has beaten earnings estimates in its previous nine quarters (including today).
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In addition, revenue across all segments soared during the quarter. The most significant segment was the QCT segment, which designs and provides software and other technologies for smartphones and other devices. QCT sales grew by 18% year-over-year to $8.678 billion. The Handset segment is also a major growth driver, as revenue increased 12% to $6.096 billion.
When breaking down Qualcomm’s revenue by geography, we can see that over 62% of its business comes from China and Hong Kong, as shown in the image below. This is followed by Vietnam and South Korea, at over 12% and 9%, respectively. Only 3.51% of the firm’s revenue comes from the U.S., which is likely a positive since it may be less impacted by any tariffs placed by Trump.
Guidance for Q1 2025
Looking forward, management has provided the following guidance for Q1 2025:
- Q1 revenue between $10.5 billion and $11.3 billion versus estimates of $10.61 billion
- Q1 EPS of $2.85 to $3.05 compared to expectations of $2.87
As you can see, guidance was better than expected, which, when combined with the strong Q4 results, caused the stock’s after-hours price to surge.
Is Qualcomm a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on QCOM stock based on 12 Buys, seven Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 43% rally in its share price over the past year, the average QCOM price target of $212.64 per share implies 25.1% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.
