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Qualcomm beats revenue expectations as the industry struggles

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(Image credit: Android Central)

What you need to know

  • Qualcomm announced its fiscal year Q3 2022 financial earnings.
  • The company beat analyst revenue expectations with $10.9 billion.
  • Qualcomm warns of lower demand for mid/low-tier handsets in fiscal Q4.
  • Samsung and Qualcomm have renewed and extended their partnership until 2030.

Qualcomm announced its latest quarterly earnings on Wednesday, narrowly beating analyst expectations with $10.93 billion in revenue.

The company has continued to beat expectations quarter after quarter as demand for 5G smartphones continues to rise. This is despite the ongoing semiconductor shortage that continues to strain multiple industries.

While handset revenue grew by 59% year-over-year, Qualcomm seemed wary of economic pressures on smartphone sales. However, the Automotive and IoT segments also helped bolster the business, with record earnings for each. The company also announced an extended partnership with Samsung to power its Galaxy devices globally until 2030.

"We are pleased to report strong quarterly results, with record QCT Automotive and IoT revenues in a challenging macroeconomic environment," Qualcomm president and CEO Cristiano Amon said in a statement. "We are also excited to announce the extension of our patent license agreement with Samsung and the expansion of our strategic partnership to deliver leading premium consumer experiences for Samsung Galaxy devices."

"Qualcomm is well positioned to be the company bringing advanced connectivity, data processing and intelligence to the edge, enabling cloud-edge convergence."

It's unclear what exactly this partnership will entail, but the rumor mill has been saying that Qualcomm is set to power all Galaxy S23 models next year, even in regions where Samsung's in-house Exynos is usually used.

Qualcomm has been riding high on sales of Android flagships like the Galaxy S22, while more Android smartphones are expected to arrive with the latest Snapdragon 8+ Gen 1 in the coming weeks. That said, while the company was optimistic about premium handset sales, Qualcomm CFO Akash Palkhiwala expects lower demand for sub-flagship tiers.

The company also just launched its new W5+ Gen 1 chipset for smartwatches, which is expected to power the next generation of Wear OS watches launching later this year.

Qualcomm expects fiscal Q4 revenue to reach somewhere between $11 billion and $11.8 billion. The company's mostly positive earnings contrast much of the industry, with companies like Alphabet, Meta, and Microsoft reporting lower-than-expected revenue and missing estimates.

Derrek Lee
Derrek Lee

Derrek is a long-time Nokia and LG fanboy who loves astronomy, videography, and sci-fi movies. When he's not working, he's most likely working out or smoldering at the camera.