Qualcomm Q2 Earnings Beat Estimates on Solid Revenue Growth

Core Viewpoint - Qualcomm Incorporated (QCOM) reported strong second-quarter fiscal 2025 results, with adjusted earnings and revenues exceeding expectations due to robust demand in Android handsets, automotive, and IoT sectors [1] Financial Performance - GAAP net income for the March quarter increased to $2.81 billion or $2.52 per share, up from $2.33 billion or $2.06 per share year-over-year, primarily driven by top-line growth [2] - Non-GAAP net income was $3.17 billion or $2.85 per share, compared to $2.76 billion or $2.44 per share in the previous year, beating the Zacks Consensus Estimate by 2 cents [3] - Total GAAP revenues for the fiscal second quarter reached $10.98 billion, an increase from $9.39 billion in the prior-year quarter [3] - Non-GAAP revenues were $10.84 billion, up from $9.34 billion a year ago, surpassing the consensus estimate of $10.67 billion [4] Segment Results - Qualcomm CDMA Technologies (QCT) revenues rose to $9.47 billion from $8.03 billion, driven by strong performance in automotive and IoT businesses, exceeding revenue estimates of $9.19 billion [5] - Automotive revenues surged 59% year-over-year to $959 million, supported by increased content in new vehicle launches with the Snapdragon Digital Chassis platform [6] - Handset revenues increased 12% year-over-year to $6.93 billion, benefiting from higher premium-tier Android shipments [7] - IoT revenues grew 27% year-over-year to $1.58 billion, driven by demand for connectivity, processing, and AI technologies [7] - Qualcomm Technology Licensing (QTL) revenues remained flat at $1.32 billion, matching estimates, with an EBT margin decline to 70% from 71% [7] Cash Flow & Liquidity - Qualcomm generated $7.14 billion in net cash from operating activities in the first half of fiscal 2025, compared to $6.5 billion a year ago [8] - At the end of the quarter, the company had $7.2 billion in cash and cash equivalents and $13.3 billion in long-term debt [8] - The company repurchased 11 million shares for $1.7 billion during the quarter [8] Q3 Guidance - For the third quarter of fiscal 2025, Qualcomm expects GAAP revenues between $9.9 billion and $10.7 billion, with GAAP earnings projected at $2.14 to $2.34 per share [10] - Non-GAAP earnings are anticipated to be between $2.6 and $2.8 per share, with QTL revenues expected to be $1.15 billion to $1.35 billion and an EBT margin of 67% to 71% [10] - QCT revenues are forecasted to be between $8.7 billion and $9.3 billion, with an EBT margin of 28% to 30% [10]