issued its fourth upside earnings forecast of the year Wednesday, saying brisk sales in a line of expensive wireless networking gear would lift third-quarter sales and earnings above estimates.
The San Diego technology company forecast third-quarter operating earnings of 51 cents to 53 cents a share on sales that are up 44% to 46% from a year ago. Analysts surveyed by Thomson First Call had been forecasting earnings of 50 cents a share in the quarter and Qualcomm's old sales guidance called for a 41% to 44% increase.
The stock was recently up $1.14, or 1.8%, to $65.86 on the Instinet premarket session.
Qualcomm said the higher forecast reflected strong sales of equipment using its wideband code division multiple access wireless protocol, and a new estimate of mobile-station-modem chip shipments: 33 million to 35 million, instead of its previous expectation of 34 million to 35 million.
"The improved outlook is due to greater-than-expected WCDMA royalties, faster migration to 6000 series MSMs and stronger orders for CSM products," the company said.
For all of 2004, the company now sees operating earnings of $2 to $2.05 a share on revenue that is 28% to 30% higher than in 2003. Analysts surveyed by Thomson First Call had been forecasting earnings of $2.01 a share and the company's old guidance called for a revenue increase of 26% to 29%.
Qualcomm said it expects to ship roughly 32 million to 36 million MSM phone chips in the fourth fiscal quarter, and predicted average selling prices of CDMA phones for fiscal 2004 to rise to about $195, up from a previous estimate of $194. That price is the basis upon which the company calculates technology royalties. Qualcomm also reiterated its estimate for the CDMA phone market to be approximately 152 million to 160 million units in calendar 2004.