U.S chipmaker Qualcomm forecast third-quarter profit below analysts expectations as it expects a drop in chip shipments, its biggest business.
The company said it expects third quarter profit of between $0.90-$1.00 per share. Analysts on average were expecting profit of $1.02 per share, according to Thomson Reuters.
Qualcomm, whose chips are used in Apple and Samsung Electronics smartphones, expects chip shipments to fall 13-22% to 175-195 million in the current quarter.
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The company said total revenue fell 19.5% to $5.55 billion in the three months ended March 27. Analysts on average were expecting revenue of $5.34 billion.
The San Diego-based company has faced a host of problems last year including a slowdown in smartphone sales, delays in closing new licensing agreements in China, its biggest market, and fighting an ultimately successful battle to thwart an activist investor’s plan to break up the company.
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Revenue from Qualcomm’s chipmaking division fell 25 percent in the latest quarter. In Qualcomm’s licensing business, which is a bigger contributor to the company’s profit, revenue fell 11.6%.
Net income attributable to Qualcomm rose to $1.16 billion, or 78 cents per share, from $1.05 billion, or 63 cents per share.
Excluding items, the company earned $1.04 per share, beating average analysts’ estimate of $0.96.