Qualcomm Q3 results likely to show continued smartphone weakness, Bernstein says
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Qualcomm (NASDAQ:QCOM) is slated to report fiscal third-quarter results on August 2 and investment firm Bernstein said the results are likely to show continued weakness in smartphones, but that a bottom may happen soon.
Analyst Stacy Rasgon, who has an outperform rating and $135 price target on Qualcomm (QCOM), said he is expecting $8.5B in revenue and $1.80 in earnings per share, with guidance expected to be $8.5B and $1.80 per share as well.
For the third-quarter, Rasgon is expecting $7.2B in QCT revenue and $1.3B in QTL revenue.
"Smartphones remain very weak (with shipments down ~8% YoY in Jun-Q); however this is a (slight?) improvement over Mar-Q's 15% YoY decline, and the ~1% sequential reduction in shipments was actually a bit above what we saw during the last 2 years so smartphone shipments themselves, while not great, do appear to be improving marginally (or at least getting less bad)," Rasgon wrote in an investor note. 
A consensus of analysts expect Qualcomm (QCOM) to earn $1.81 per share on $8.51B in revenue.
Rasgon said that assuming the smartphone industry does start to bottom, Qualcomm (QCOM) could benefit from other adjacent stories, including PCs, virtual and augmented reality, as well as the "recent chatter" that Apple (AAPL) could use the company's modem technology for longer than initially thought. 
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