Qualcomm(US:QCOM)2025-02-05 21:05Financial Performance - Revenues for Q1 fiscal 2025 were $11.7 billion, a 17% increase year-over-year, with net income of $3.2 billion, up 15% from the previous year[60] - QCT segment revenues increased by 20% to $10.1 billion, driven by higher revenues from handsets, IoT, and automotive[62] - QTL segment revenues rose by 5% to $1.7 billion, reflecting an increase in licensing revenues[62] - Gross margin decreased to 56% in Q1 fiscal 2025, down from 57% in the prior year, primarily due to a lower proportion of higher-margin QTL licensing revenues[66] - QCT segment's earnings before tax (EBT) increased to $3.2 billion, with EBT as a percentage of revenues rising to 32%[74] - QTL segment's EBT increased to $1.2 billion, with EBT as a percentage of revenues at 75%[77] Expenses - Research and development expenses increased to $2.2 billion, representing 19% of revenues, compared to 21% in the previous year[67] - Selling, general and administrative expenses rose to $723 million, maintaining 6% of revenues[70] - Interest expense decreased to $163 million, while investment and other income increased by $31 million to $243 million[71] - Effective tax rate for Q1 fiscal 2025 was 13%, up from 5% in the previous year, with an estimated annual effective tax rate of 11%[72] Cash Flow and Liquidity - Net cash provided by operating activities for the first three months of fiscal 2025 was $4,587 million, an increase of $1,638 million from $2,949 million in the same period of fiscal 2024[89] - Cash and cash equivalents increased to $8,713 million as of December 29, 2024, up by $864 million from $7,849 million at September 29, 2024[88] - The company believes its current cash, cash equivalents, and marketable securities will satisfy working and other capital requirements for at least the next 12 months[93] Business Developments - The company expects a $32 million increase in estimated sales of 3G/4G/5G-based multimode products and $30 million in higher royalty revenues recognized related to devices sold in prior periods[84] - The company has entered into comprehensive 4G and 5G license agreements with Shenzhen Transsion Holdings Limited, resolving all outstanding litigation between the parties[82] - The company is finalizing long-term license renewals with two key Chinese OEMs and is in discussions with Huawei regarding an expired agreement[83] Challenges and Risks - The company anticipates continued product cost increases due to transitions to new generations of leading process technology nodes from key semiconductor wafer suppliers[85] - The company is facing regulatory investigations and potential litigation that could materially affect its business and financial condition[92] - The QSI segment reported equipment and services revenues of $13 million for the three months ended December 24, 2023, a decrease of 100% compared to the previous year[79] Shareholder Actions - The company repurchased 11 million shares of common stock for $1.8 billion during the first three months of fiscal 2025[89]