Tue, May 24, 3:37 PM
- Xilinx (NASDAQ:XLNX) is up 5.9% this afternoon on heavy volume after a StreetInsider report saying the company has drawn a $15B takeover offer, but from a mystery suitor.
- The company has been considered the only large-cap chipmaker with the attributes of a good target, after Intel's purchase of Altera. Apple suppliers including Qualcomm (NASDAQ:QCOM) or Broadcom (NASDAQ:AVGO) are the most likely suitors for Xilinx.
- Xilinx used yesterday's analyst day to reiterate guidance for fiscal 2017 (sales growth of 4-8%, opex growth of 7-9%) and prompt strong bullishness from Pacific Crest. Analyst John Vinh sees the firm taking share in field-programmable gate arrays from Intel's Altera, which has faced delays and has "already lost at 20 nm and 14 nm."
- Xilinx is expecting $750M in incremental revenue over the next five years, a modest 6% in compound annual growth. "Of the $750 million, $500 million is expected to be from market expansion, while $250 million should be from PLD share gains. This would imply ~$3.25 in EPS, which at 20x suggests fair value of $65," Vinh writes.
- That $65 value would be 37% upside from today's (higher) price; Vinh has a price target of $55 (16% upside).
- William Blair's Anil Doradla thought the overall tone was good but "lacked conviction" and was light on comment about the company's key wireless/wireline segments. He's maintaining an Outperform rating.
Tue, Apr. 26, 5:19 PM
- Apple (down 7.8% after hours) missed FQ2 estimates and guided for FQ3 revenue of $41B-$43B, below a $47.32B consensus. iPhone unit shipments fell 16% Y/Y to 51.2M, and iPad shipments 19% to 10.3M. Both figures were a little better than expectations. However, guidance points to another large Y/Y iPhone decline in FQ3.
- Cirrus Logic (down 4.2%) beat FQ4 estimates, but guided for FQ1 revenue of $220M-$250M, below a $257.5M consensus. Apple accounted for 62% of FQ4 revenue, and another customer (believed to be Samsung) 17%.
- Skyworks (NASDAQ:SWKS) is down 5.2% after hours. Qorvo (NASDAQ:QRVO) is down 5%. Broadcom (NASDAQ:AVGO) is down 3.8%. Qualcomm (NASDAQ:QCOM) is down 2.4%. NXP (NASDAQ:NXPI), which rallied earlier today thanks to a Q1 beat and solid Q2 guidance is down 2.5%. Nasdaq futures are down 0.9%.
Wed, Apr. 20, 4:43 PM
- In tandem with its FQ2 report, Qualcomm (NASDAQ:QCOM) has announced the settlement of its royalty arbitration dispute with LG. Terms of the settlement, which was first disclosed in January on the FQ1 earnings call, remain unknown.
- The company has also announced a 3G/4G patent licensing deal with Chinese OEM Hisense. Deals with Xiaomi, Lenovo, and a slew of other Chinese OEMs have been announced in recent months.
- MSM shipments: FQ2 MSM chip shipments totaled 189M, down 19% Y/Y but towards the high end of a 175M-195M guidance range - Snapdragon 820 shipments for Samsung's Galaxy S7 helped out. FQ3 guidance is also at 175M-195M (-13%-22% Y/Y).
- Device sales: Reported 3G/4G device sales (based on FQ1 licensee shipments) fell 8% Y/Y to $70.1B. Shipments fell 13% to 335M-339M, while ASP rose 6% to $205-$211.
FQ3 reported device sales (based on FQ2 shipments) are expected to be down 1%-14% Y/Y to $52B-$60B. Meanwhile, Qualcomm has lowered its 2016 3G/4G device shipment forecast to 1.625B-1.725B (+5%-11% Y/Y) from 1.67B-1.77B.
- Financials: FQ2 chip division (QCT) revenue fell 19% Y/Y to $3.34B; segment op. profit fell to $170M from $750M. Licensing division (QTL) revenue fell 12% to $2.14B; op. profit fell to $1.86B from $2.16B.
Boosting EPS: $1.55B was spent to buy back 31.7M shares. $2.05B was spent on buybacks in FQ1. Qualcomm ended FQ2 with $30B in cash ($27.1B offshore) and $11.9B in debt.
- QCOM now +0.5% after hours to $52.35. A lot has been priced in over the last two years.
- Qualcomm's results/guidance, earnings release (.pdf), slides (.pdf)
- Now read Qualcomm Earnings: Opportunity On Any Drop
- Update (6:18PM ET): Qualcomm has turned negative again: Shares are now down 2.7% after hours.
Wed, Apr. 20, 4:06 PM
- Qualcomm (NASDAQ:QCOM): FQ2 EPS of $1.04 beats by $0.08.
- Revenue of $5.54B (-20% Y/Y) beats by $200M.
- Expects FQ3 revenue of $5.2B-$6B (-11% to +3% Y/Y) and EPS of $0.90-$1.00 (-9% to +1%) vs. a consensus of $5.56B and $1.02.
- Shares -3.1% after hours.
- Press Release (.pdf)
- Update: Along with its results, Qualcomm announces it has settled its arbitration dispute with LG (terms are undisclosed), and that it has struck a 3G/4G patent licensing deal with Chinese OEM Hisense (follows deals with many other Chinese firms).
- Update 2 (4:45PM ET): Qualcomm is now up 0.5% after hours. Details on the company's FQ2 results can be found here.
- Update 3 (6:57PM ET): Shares have reversed course again: They're now down 2.6% after hours.
Tue, Apr. 19, 5:35 PM| Tue, Apr. 19, 5:35 PM | 16 Comments
Fri, Apr. 8, 9:11 AM
Fri, Apr. 1, 5:12 AM
- Qualcomm (NASDAQ:QCOM) has agreed to pay $7.5M to settle Chinese "princeling" charges, a term used in Asia that refers to hiring young relatives of key executives or political figures.
- A U.S. judge has dismissed Standard Chartered (OTCPK:SCBFF) from a class action accusing 16 banks of harming investors by rigging prices in the $5.3T-a-day forex market.
- Uber CEO Travis Kalanick failed to win the removal of an antitrust suit accusing him of scheming to drive up prices for passengers.
- Lastly, the FCC ruled that Netflix did not violate any regulations when it "throttled" the picture quality for AT&T and Verizon wireless customers and it has no plans to investigate.
Tue, Mar. 8, 2:36 PM
- Skyworks (SWKS -3.1%), Qorvo (QRVO -3.5%), and Jabil (JBL -3.8%) are among the ZTE suppliers selling off after the Chinese phone/telecom equipment vendor got hit with U.S. sanctions over the alleged re-exporting of controlled items to Iran. Qualcomm and various optical component vendors are also off. The Nasdaq is down 0.6%.
- The sanctions, which have stoked fears of Chinese retaliation, require U.S. ZTE suppliers to apply for an export license. The Commerce Department says it's operating under a "policy of presumption of denial" for granting licenses.
- Bloomberg estimates Jabil's quarterly ZTE sales total ~$35M. Rosenblatt's Jun Zhang sees a major hit to Qualcomm (NASDAQ:QCOM) and Skyworks' sales. "ZTE sold 55M smartphones in 2015, and we think the halt on order shipments will affect at least 25-30M units for 2Q16 and 3Q16, even though other smartphone OEMs will take market share away from ZTE. The impact to Skyworks and Qualcomm would be around $100-200M and $300-500M, respectively." Some of those sales, of course, could be picked up by rivals also buying from Qualcomm and Skyworks.
Tue, Mar. 8, 10:58 AM
- Ahead of today's annual meeting (starts at 12:30PM ET, webcast), Qualcomm (QCOM -2.2%) has hiked its quarterly dividend by 10% to $0.53/share (implies a 4.1% yield). The hike will be effective for dividends payable after March 23.
- Possibly weighing on shares (amid a 1% Nasdaq drop): The U.S. Commerce Department has slapped sanctions on Chinese smartphone/telecom equipment vendor ZTE over alleged attempts to re-export controlled items to Iran. The sanctions require U.S. suppliers of parts and equipment to ZTE to apply for an export license; the Commerce Department says it's operating under a "policy of presumption of denial" for granting licenses.
- Qualcomm's chips have gone into plenty of ZTE phones and base stations, and Qualcomm is four months removed from striking a new 3G/4G licensing deal with ZTE. Aside from that, the ZTE sanctions are stoking fears China will retaliate with its own sanctions against U.S. firms
- Earlier: Optical component firms sell off due to ZTE sanctions
Fri, Mar. 4, 5:51 PM
- Following a rough 2015 in which weak PC demand, slowing smartphone growth, plunging memory prices, and a late-year inventory correction all weighed, Wells Fargo's David Wong thinks a chip industry recovery is on the way.
- His rating for the sector has been upped to Overweight from Market Weight, and his ratings for Micron (NASDAQ:MU), Analog Devices (NASDAQ:ADI), and Microsemi (NASDAQ:MSCC) in particular have been raised to Outperform. Outperform ratings are reiterated for Intel (NASDAQ:INTC), Qualcomm (NASDAQ:QCOM), Linear (NASDAQ:LLTC), AMD, Xilinx (NASDAQ:XLNX), and SunEdison Semi (NASDAQ:SEMI).
- Wong argues 2016 chip industry growth could be as high as 7%
(with growth reaching double-digits by year's end), and that 8%-14% growth is possible in 2017. Gartner estimates industry revenue fell 1.9% in 2015 to $333.7B.
- Wong: "Over the last 5 years 2010-2015, semiconductor industry growth has tracked below global GDP for the most part. We think this has created significant pent-up demand created by the deferral of electronics goods purchases and aging of the installed base of electronics systems ... We think that there could well be the first signs of improvement in the year/year comparisons at some point in the June 2016 quarter in the many of the broader chip markets, including the industrial, communications infrastructure and PC markets."
- Some expectations for a recovery might already be priced in: The Philadelphia Semi Index (NASDAQ:SOXX) is up 18% from a February low of $74.80. However, it's still down 13% from a June high of $101.80.
- Earlier today, Broadcom (the company produced by the Avago/Broadcom merger) posted big gains after beating January quarter estimates and issuing healthy April quarter guidance. On its earnings call, Broadcom forecast solid April quarter growth for its wired infrastructure (telecom/networking chip) segment, and a 2H16 recovery for its mobile chip segment (recently hurt by soft iPhone-related demand). More cautious outlooks were provided for Broadcom's storage and industrial segments.
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
Thu, Mar. 3, 12:15 PM
- CLSA's Sriji Pajjuri reports supply chain checks indicate Intel (INTC +0.6%) has landed a portion of Apple's (NASDAQ:AAPL) iPhone 7 baseband modem orders. He estimates the company could supply 30%-40% of the modems going into the device. Pajjuri thinks such a win would boost Intel's revenue and earnings by 1.5%-2%, and respectively hurt current iPhone modem supplier Qualcomm's (QCOM -1.2%) revenue and earnings by 4% and 2%.
- VentureBeat reported back in March 2015 Intel's XMM 7360 4G modem (450Mbps peak download speeds) would go into 2016 iPhones aimed at emerging markets. The site followed up in October by stating Intel "now has a thousand people or more" working to get the XMM 7360 designed into an iPhone, and that Apple is interested in eventually developing an SoC pairing a 4G modem with an A-series app processor, with Intel manufacturing the SoC and providing modem IP.
- Qualcomm is still viewed as having a modem performance lead on the high-end. The company recently unveiled a modem (the Snapdragon X16) supporting 1Gbps peak download speeds, while adding the chip is expected to go into commercial products in 2H16.
- Separately, Baird's Tristan Gerra has upgraded Intel to Outperform, and hiked his target by $5 to $38. He cites healthy DCG (server CPU division) growth and (without naming Apple) the potential for a major "tier-1 smartphone ramp" in 2H16.
- Gerra: "After being on the sidelines for a few years on Intel, we think data center has reached sufficient critical mass within Intel's mix to drive a resumption in EPS growth starting in 2017 ... Assuming a low single-digit decline in annual PC revenue and a high single-digit growth rate in data center (below Intel's 15% growth target), DCG mix becomes large enough to drive EPS growth starting in 2017 and in years forward ... We believe Intel's LTE technology has matured, improving Intel's positioning for a potential tier-one smartphone ramp this second half."
- Yesterday: Intel reportedly working on augmented reality headset platform
Tue, Mar. 1, 2:06 PM
- Without admitting or denying the SEC's findings, Qualcomm (QCOM +2.3%) has agreed to pay a $7.5M fine (equal to about .01% of the company's market cap, for those wondering) to settle a corruption probe related to its Chinese activities.
- Qualcomm first disclosed the probe, which relates to conduct occurring prior to 2012, in April 2014. The company notes the DOJ has already closed its investigation of the matter without taking action.
- The SEC says its investigation found Qualcomm violated the Foreign Corrupt Practices Act " by hiring relatives of Chinese government officials deciding whether to select the company’s mobile technology products." It also accuses Qualcomm of providing "gifts, travel, and entertainment to try to influence officials at government-owned telecom companies in China," and (due to insufficient internal controls) of misrepresenting in its books/records "that the things of value provided to foreign officials were legitimate business expenses."
- Qualcomm continues to follow markets higher. Shares rose two weeks ago after a Lenovo licensing deal was announced.
Thu, Feb. 18, 5:26 PM
- Qualcomm (NASDAQ:QCOM) has struck a licensing deal with Lenovo that covers the Chinese OEM's 3G and 4G phone sales. Royalty terms are consistent with that of Qualcomm's early-2015 settlement with Chinese antitrust regulators. Shares are up 1.2% after hours to $49.65; they rose 1.4% in regular trading.
- The Lenovo deal follows late-2015 agreements with ZTE and Xiaomi. IDC estimates Lenovo had a 5.2% 2015 global smartphone unit share (#4 behind Samsung, Apple, and Huawei) on the back of 74M shipments (+24.5% Y/Y).
- In spite of the antitrust settlement, non-payments and under-reporting by Chinese phone OEMs weighed heavily on Qualcomm's 2015 licensing division (QTL) sales. QTL revenue fell 12% Y/Y in FQ1 (calendar Q4) to $1.61B, thanks to both Chinese pressures and the deferral of $100M in LG revenue due to a royalty dispute.
- Separately, Qualcomm has continued unveiling new products ahead of the Mobile World Congress (runs from Feb. 22-25). Following last week's reveal of a 1Gbps 4G modem (the Snapdragon X16) and a wearables SoC (the Snapdragon Wear 2100), the company has announced new RF360 RF front-end chips, including a new envelope tracking IC (improves power consumption) and low-cost power amplifiers. Also announced: A partnership with Samsung for developing small cell base stations that use Qualcomm's FSM9955 chipset and support LTE use in unlicensed spectrum (LTE-U).
Tue, Feb. 16, 12:15 PM
- "In the current environment, with uncertainty abounding in semis, it may be time to rotate into something that has been suffering under such headwinds for some time, and as a result may provide a shelter for limited downside, and with very low expectations providing an outlet for upside," writes Bernstein's Stacy Rasgon, upgrading Qualcomm (QCOM +4.3%) to Outperform and hiking his target by $5 to $55. Shares are outperforming on a day the Nasdaq is up 1.7%.
- Rasgon thinks expectations are so low that a catalyst "could be as simple as an earnings call without a guide-down." He adds Qualcomm has mentioned Korean regulators have suggested their probe of the company's IP licensing practices doesn't cover the magnitude of Qualcomm's royalty rates, and that "there are no other time bombs of this sort until 2022," when the company's Nokia licensing deal ends.
- At current levels, Rasgon believes markets are pricing in a shrinking 3G/4G device market, a decline in Qualcomm's average royalty rate to ~2.4% from 2015's 3.17%, continued chip division (QCT) share loss, a long-term QCT op. margin of just 10%, and negative terminal growth. Shares go for 9.8x an FY17 (ends Sep. '17) EPS consensus of $4.77.
- The upgrade follows a Feb. 11 analyst day (slides - .pdf) during which Qualcomm officially unveiled its Snapdragon X16 baseband modem, which delivers 1Gbps peak 4G download speeds and relies on Samsung/GlobalFoundries' 14nm FinFET manufacturing process. The company also revealed its wearables-focused Snapdragon Wear 2100 SoC and three new mid-range Snapdragon baseband/app processors.
Mon, Feb. 8, 10:10 AM
- OTR Global reports Ambarella's (NASDAQ:AMBA) IP security camera and automotive SoC pricing is down 15%-20% Q/Q in Q1 due to competition in China.
- The firm also reports Qualcomm (NASDAQ:QCOM) is pushing for design wins with major Ambarella clients such as GoPro and (consumer drone leader) DJI for drone and high-end sports camera SoCs (source: Notable Calls). Qualcomm recently launched its Snapdragon Flight drone reference platform, as well as an IP security camera reference platform known as the Snapdragon 618.
- Ambarella is among the biggest tech decliners on a morning the Nasdaq is off 2.3%. Shares have made fresh 52-week lows.
Wed, Feb. 3, 11:13 AM
- Bloomberg reports Google (GOOG, GOOGL) is "planning to publicly give its support" for Qualcomm's (QCOM +1.4%) first ARM (ARMH +2.2%) server CPUs at an investor event next week. It adds Google and Qualcomm have cooperated on design work, and that the former will commit to using the latter's chips if they meet performance goals.
- Google is the world's biggest server buyer, and has largely relied on Intel's (INTC -4.1%) Xeon CPUs. The Web giant's adoption of Qualcomm processors, even if for only a fraction of its workload, would act as a major reference win for the fledgling ARM server CPU market. There has been speculation Amazon might also adopt ARM server CPUs, following its acquisition of chip startup Annapurna Labs (recently unveiled a line of low-end network processors).
- Qualcomm is just four months removed from showing off a prototype ARM server CPU featuring custom cores. The company has been hoping the server market will provide a long-term sales lift as it continues dealing with mobile pressures - Qualcomm's chip division (QCT) sales fell 22% Y/Y in calendar Q4 to $4.1B.
- Intel has been hoping to keep Google and other major Web/cloud clients loyal in part by providing custom Xeon CPUs, and by creating products that place Xeon chips and recently-acquired Altera's FPGAs (can be programmed on the fly to handle new algorithms/code) in the same package. Qualcomm has partnered with Altera archrival Xilinx.
- Qualcomm and ARM are higher in spite of a 1.6% Nasdaq drop. Intel is underperforming; shares are down 3.3% after accounting for the fact Intel is trading ex-dividend.
QUALCOMM, Inc. engages in the development, design, manufacture, and marketing of digital telecommunications products and services. It operates through three segments: Qualcomm CDMA Technologies, Qualcomm Technology Licensing, and Qualcomm Strategic Initiatives. The Qualcomm CDMA Technologies... More
Industry: Communication Equipment
Country: United States
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