After the US market closed yesterday, $Qualcomm(QCOM)$ released the fourth quarter (corresponding to the third quarter of the natural year) financial results, performance guidance exceeded expectations. Although the after-hours rise was only 3.83%, it issued a signal that consumer electronics is about to usher in a roaring bull market!
Specifically, Qualcomm's revenue in the fourth quarter of fiscal year 2023 (as of September 24) was $8.63 billion, down 24.3% from the same period last year, and slightly exceeding analyst expectations of $8.51 billion.
The most explosive news is that Qualcomm expects revenue in the next quarter to be between $9.1 billion and $9.9 billion, with a median of $9.5 billion. Year-on-year growth will reverse four consecutive quarters of double-digit declines to 0.4%, and analysts expect $9.26 billion:
As we all know, Qualcomm is a mobile phone chip giant, its mobile business contributes 63% of the total revenue, and the rest is IOT, automotive and technology licensing. It can be said that, the rise and fall of Qualcomm is closely related to mobile phones.
According to IDC data, in the third quarter of this year, the global smartphone shipments of 302.8 million units, a year-on-year decline of 0.1%, the decline is significantly narrower than the previous two quarters, the turning point is initially:
Qualcomm's management said, the recovery of the mobile phone market is mainly due to the end of inventory demineralization, coupled with the launch of Qualcomm's new generation of mobile phone chip, Snapdragon 8 Gen3, which is expected to bring a wave of growth.
In the financial results, Qualcomm's inventory in the fourth quarter of 2023 fiscal year was $6.422 billion, a month-on-month sequential decline:
From the perspective of downstream mobile phone manufacturers, $XIAOMI-W(01810)$ $Xiaomi Corp.(XIACY)$ has just recently released the Xiaomi 14 series mobile phone with Qualcomm Snapdragon 8 Gen3 chip, with hot sales figures.
According to the official report, the sales of Xiaomi 14 series opened for 5 minutes, which is 600% of the sales of the previous generation Xiaomi 13 series. Four hours after the first sale, it broke the record of "first-day sales" of domestic mobile phones on the four major e-commerce platforms in the past year. $JD.com(JD)$ $JD-SW(09618)$ data show that Xiaomi 14 over iPhone 15 Pro sales, breaking the platform in the recent year of single product sales record!
In addition to the recovery of the mobile phone market, Qualcomm may usher in a new growth point, it is about to enter the PC chip market.
Qualcomm expects laptops powered by Snapdragon X Elite processor, which management says is twice as fast as a similar 12-core Intel processor and uses 68% less power than Intel's competitors, to be available in the middle of next year. It runs 50% faster during peak hours than the M2, which $Apple(AAPL)$ claims is the computer processing champion.
Cristiano Amon, Qualcomm CEO, believes that the way people use the PC is changing, and PC has become more like a device used to communicate. New AI features such as $Microsoft(MSFT)$ Windows 365 Copilot will bring further changes to the PC market, and the entire PC experience will become an AI experience. Qualcomm is expected to benefit from the advent of the AI PC era.
According to $Intel(INTC)$ and $Advanced Micro Devices(AMD)$ recently released third quarterly reports, the PC market has ushered in a recovery, of which AMD's PC business increased by 42.2% in the third quarter, and fell 53.6% in the last quarter.
Earlier, $Taiwan Semiconductor Manufacturing(TSM)$ also said in its third quarterly report that it had observed initial signs of stabilization in the mobile phone and PC markets!
Given that Qualcomm's share price is depressed this year and its price-to-sales ratio valuation is still low, Qualcomm may usher in a reversal after the earnings report. At the same time, individual stocks in the consumer electronics industry chain will also benefit from the recovery of the industry, and a bull market may be about to emerge:
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