Qualcomm Earnings Dazzle, but Not Enough

NEW YORK ( TheStreet) -- Qualcomm ( QCOM) delivered the expected earnings beat and guidance raise, but the numbers weren't strong enough to keep the Street happy.

The San Diego chip shop posted adjusted earnings of 73 cents a share Wednesday, up from the 68 cent profit in the year-ago period and two cents better than the analysts' consensus target.

Sales for the fiscal third quarter ended last month were $3.62 billion, up 28% over year-ago levels of $2.70 billion, and above the $3.6 billion in revenue analysts were expecting, according to Yahoo! Finance.

But shares of the wireless tech shop dipped 2% to $55.95 in after-hours trading Wednesday as sales slipped 6% below prior quarter levels and guidance was not as robust as expected.

"Qualcomm delivered strong year-over-year results again this quarter as our business performed well across all key guidance metrics," CEO Paul Jacobs said in a press release.

Looking ahead, Qualcomm says it expects fiscal fourth-quarter earnings of about 77.5 cents a share on revenue in the range of $4.01 billion. That is slightly better than analysts' targets, which called for a profit of 76 cents a share on sales of $3.96 billion.

Qualcomm says it shipped 120 million chips in the most recent quarter, up 17% from year-ago levels and up 2% sequentially. Some analysts expected chip shipments of 119 million.

The company says about 172 million CDMA phones were shipped in the March quarter at a average selling price of $212. Qualcomm shipped 136 million phones during the same period a year ago.

The company did not mention Apple ( AAPL) in its press release. Qualcomm is expected to see a big upswing in sales due to recent design wins at Apple, Nokia ( NOK) and Research In Motion ( RIMM).

Qualcomm typically offers conservative projections and then updates its financial forecast later in the quarter. But for now, the Apple jackpot did not register in the guidance.

--Written by Scott Moritz in New York.

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