Qualcomm expected to report 'solid' results as it diversifies chip product line
Justin Sullivan/Getty Images News

Qualcomm (NASDAQ:QCOM) is set to deliver its fiscal third-quarter results after Wednesday's close of trading, and Wall Street is expecting an upbeat report from the communications chipmaker due to its diversification strategy and gains in the market for 5G mobile-phone technology.
Analysts estimate that Qualcomm (QCOM) will report a profit of $2.87 a share on $10.85B in revenue for the quarter that ended in June. During the same period a year ago, Qualcomm (QCOM) earned $1.92 a share on almost $8B in sales.
Michael Walkley, of Canaccord Genuity, who has a buy rating on Qualcomm's (QCOM) stock, said he believes that the company should report "solid" results Wednesday. Walkley said Qualcomm's (QCOM) Internet of Things and automotive product lines should be particular areas of strength for the chip giant.
Walkley said that IoT was Qualcomm's (QCOM) fastest growing division during the first half of the year, while the company's automotive business added $3B in design wins during the same period. "We believe our automotive and IoT estimates ... will likely prove conservative given the momentum for those business units and potentially for improving supply to these areas," Walkley said.
Qualcomm (QCOM) has also set an ambitious diversification path that fis highlighted by less reliance on Apple's (AAPL) line of iPhones. KeyBanc analyst John Vinh said that Qualcomm (QCOM) could see some "displacement of its modem [business]" due to the Apple (AAPL) situation, but he still holds an overweight rating on the company's stock due to its history of managing chip-sector changes and issues.
On Monday, President Joe Biden met virtually with a group of semiconductor industry executives to discuss methods to provide more governmental support to chip companies.