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Tuesday, January 31, 2012

Qualcomm Earnings Preview: Record Quarter Expected, Reports Wednesday, February 1

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Update 1 on 1-29-12


Qualcomm (QCOM) to Announce Quarterly Earnings

Qualcomm will report calendar Q4 2011 financial results on Wednesday, February 1, after market close. The conference call will be at 1:45 p.m. PT.


Qualcomm Future and Past Financial Performance


Estimated Calendar Q4 2011 Earnings per Share (Non-GAAP)
Yahoo Finance Analysts Estimates: $0.90 avg, $0.88 low, $0.95 high, 35 analysts
Prior Quarter: $0.80
Prior Year: $0.82
Qualcomm Outlook: $0.86 - $0.92


Prior Calendar Q3 2011 Financial Results (GAAP)
When Qualcomm reports calendar Q4 2011, the 3 months ended December, financial results on February 1, Qualcomm is expected to meet, beat, or miss various prior quarterly results. These prior quarterly GAAP financial results were:
Total Revenues $4.12B
Operating Income $1.24B
Net Income $1.06B
Earnings per Share $0.62
Qualcomm Outlook $0.70 - $0.76
Gross Margin 44.00% (Equipment & Services)
Operating Margin 30.07%
Net Margin 25.65%


Summary (GAAP) Overall, Qualcomm is expected to beat QoQ and beat YoY for Earnings per Share. Calendar Q4 is a strong, if not the strongest quarter, on an annual basis. Therefore, Qualcomm is expected to beat QoQ and YoY for Total Revenues, Operating Income, Net Income, and Cash Flow per Share. Qualcomm should beat QoQ and YoY for operating and net margins. In short, this is expected to be a record quarter. The prior quarterly charts are reviewed below.


Qualcomm Beats QoQ and YoY for Record Quarter!


Qualcomm Summary Q3 2011 Intel rebounded in Q3 2011 with record total revenues, net income, and earning per share. Revenue growth was driven by data centers and developing countries, notably China. "Emerging markets are good, enterprise is strong, the mature market consumer is a little bit weaker," said Chief Financial Officer Stacy Smith. Investor confidence is strengthened by the latest financial results, after being deflated somewhat in the prior quarter. Hopefully this growth can continue and appears so based on Intel's Q4 2011 outlook. Financial position continues strong.


Qualcomm Income Statement Q3 2011 Intel reported record total revenues of $14.23 billion, record net income of $3.47 billion, and record earnings per share of $0.65. From the prior quarter Q2 2011, total revenues were up +9.22%, net income up +17.40%, and earnings per share were up at +20.37%. From the prior year Q3 2010, total revenues were up +28.20%, net income up +17.36%, and earnings per share up +25.00%. Gross margin increased QoQ to 63.36%, operating margin increased QoQ to 33.62%, and net margin increased QoQ to of 24.37%. The operating expense ratio has been stable and is currently 29.74%.


Qualcomm Balance Sheet Q3 2011 Intel continues liquid and well capitalized. Total assets have reached an all-time high of $77.05 billion. The current ratio, current assets / total assets, increased QoQ to 37.84%. Intel has $10+ billion in short-term cash, cash equivalents, and marketable securities. Capital to assets, total stockholders' equity / total assets, decreased QoQ to 65.37% from 73.72% due to an increase in debt. The debt ratio, short-term and long-term debt to total assets, increased QoQ to 10.12% from 3.27%. Return on assets of 19.58% continues at recent levels and above the historical average.


Qualcomm Q4 2011 Business Outlook (GAAP)
• Non-GAAP EPS: $0.86 - $0.92
• GAAP EPS: $0.70 - $0.76


Qualcomm Performance by the Quarters


Qualcomm Cash Flow per Share and Earnings Per Share Current Cash Flow per Share of $1.06 is an 11-quarter high. Current Earnings per Share of $0.62 is a 3-quarter high, a +1.64% increase QoQ, and a and +16.98% YoY increase. The chart averages CFS and EPS are $0.79 and $0.46, respectively.

 


Qualcomm Total Revenues, Operating Income, and Net Income Current Total Revenues of $4.12 billion is a record high, a +13.64% increase QoQ, and a +39.46% increase YoY. Current Operating Income of $1.24 billion is a record high. Current Net Income of $1.06 billion is a 3-quarter high, a +2.03% increase QoQ, and a +22.08% increase YoY. The chart averages for TR, OI, and NI are $3.18 billion, $960 million, and $923 million, respectively.

 


Qualcomm Gross Margin, Operating Margin, and Net Margin Current Gross Margin (Equipment and Services) of 44.00% slightly decreased QoQ and significantly decreased YoY. Current Operating Margin of 30.07% slightly decreased QoQ and significantly decreased YoY. Current Net Margin of 25.65% significantly decreased both QoQ and YoY. The chart averages for GM (E&S), OM, and NM are 47.61%, 30.16%, and 29.23%, respectively.

 


Qualcomm Return on Assets Current Return on Assets of 12.74% is a multi-year high. The ROA chart average is 10.95%.

 

Qualcomm YoY Growth Rates Current Total Revenues Growth of +39.46% is historically well above average and the 5th consecutive quarter of growth. Current Earnings per Share Growth of +16.98% is historically below average but the 6th consecutive quarter of growth. The chart averages for TRG and EPSG are +25.40% and +22.38%, respectively.

 


Qualcomm Revenue Sources Equipment and Services at $2.67 billion is the primary driver of sales growth, an all-time high, and is 64.93% of total revenues. Licensing at $1.44 billion is a 2-quarter high, and 35.07% of total revenues. The chart averages for E&S and Licensing are $1.89 billion and $1.17 billion, respectively.

 


Qualcomm Operating Expense Ratio Current Operating Expense Ratio of 69.93% is within the historical range. The OER chart average is 71.30%.

 

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