Shares in Qualcomm Inc. rose more than 15% in late trading after the chipmaker reported better-than-expected fiscal second-quarter earnings and revenue. The company also announced a new $20 billion share buyback authorization and confirmed its long-awaited entry into the data center market.
For the quarter ending March 29, Qualcomm posted adjusted earnings per share of $2.65 on revenue of $10.6 billion, both topping analyst projections. Handset revenue fell 13% to $6.02 billion, but automotive revenue surged 38% to a record $1.33 billion. The Internet of Things segment grew 9%, while licensing revenue rose 5%.
CEO Cristiano Amon confirmed that Qualcomm’s data center push is on track, with initial shipments to a leading hyperscaler expected later this calendar year.
Looking ahead, Qualcomm provided a cautious forecast for the fiscal third quarter, projecting adjusted earnings of $2.10 to $2.30 per share on revenue of $9.2 billion to $10 billion-both below consensus estimates. The company cited memory supply constraints and pricing pressure affecting handset OEMs.
Despite the soft guidance, shares reversed an initial 6% decline to trade sharply higher as investors focused on the capital return program and the data center catalyst. Qualcomm repurchased $2.8 billion in stock during the quarter and has completed $5.4 billion in buybacks this fiscal year.