Qualcomm Gains Despite Miss, Below-Consensus Guidance (Update 1)

Updated from 4:39 p.m. EST to provide comments from the conference call in the fourth paragraph.

NEW YORK (TheStreet) -- Shares of Apple (AAPL) supplier Qualcomm (QCOM) jumped in after-hours trading following its third-quarter report despite an earnings miss and lowered fourth-quarter guidance.

Qualcomm, which makes chips for the iPhone, iPad and other mobile devices, reported third-quarter earnings of 85 cents per share on $4.63 billion in revenue. Analysts polled by Thomson Reuters expected the San Diego-based chip maker to generate a profit of 86 cents per share on $4.68 billion in revenue.

CEO Dr. Paul Jacobs was positive on the quarter, as 3G and 4G technologies continue to expand across the globe, but noted growth has moderated slightly.

"Looking forward, our growth estimates for 3G/4G device shipments in calendar 2012 have moderated slightly, and we now expect the demand profile of the calendar year to be more back-end loaded as new devices are launched for the holiday season," Jacobs said in a statement. "Although our outlook for semiconductor volumes in the fiscal fourth quarter has been reduced from our prior expectations, we are ramping supply of our 28 nanometer chipsets to help enable what we expect to be a strong December quarter for our semiconductor business."

On the conference call, Qualcomm said it expects a slew of new high-tier smartphones in time for the holidays. Its improved position with its 28 nanometer supplies will help meet the "significant demand" that is being pushed into the December quarter, the company said. A significant portion of the 28 nanometer supplies is the company's Snapdragon portfolio, which is a big percentage of the company's shipments, in the high-20% range, Qualcomm said on the call.

Qualcomm's fourth-quarter guidance was for non-GAAP earnings of 78 to 84 cents per share on revenue of $4.45 billion to $4.85 billion. Wall Street's current consensus view is for a profit of 89 cents a share in the September-ended period on revenue of $4.89 billion. Qualcomm now expects between 875 million and 935 million 3G/4G devices will ship, up 14% year-over-year.

The company ended the quarter with $26.5 billion in cash and marketable securities, up from $20.2 billion in the year ago quarter.

Shares of Qualcomm finished the regular session higher, gaining 2.92% to $56.05. After running as low as $52.50 shortly after the closing bell, the stock was last quoted at $59.59, up 6.32%, on extended volume of nearly 4 million, according to Nasdaq.com.

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--Written by Chris Ciaccia in New York

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