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Qualcomm sees growth slowing on China problems

Qualcomm sees growth slowing on China problems

Qualcomm has warned for flat to lower earnings in its new fiscal year, as revenue growth slows due its licensing problems in China. In addition to an investigation into its licensing by Chinese authorities, the company said a number of licensees were under-reporting units or not agreeing new contracts pending the state probe. 

For the year to September 2015, Qualcomm forecast revenues 1-9 percent higher, versus 7 percent growth last year, while EPS is estimated flat to 7 percent lower. The outlook does not include its planned takeover of CSR, which is expected to close next summer. The company did not provide an estimate for 3G/4G device shipments in 2015. For calendar 2014, it expects shipments of 1.3-1.5 billion, but only 1.04-1.13 billion will likely be reported to the company. 

In the latest quarter, the company recorded revenues up 7 percent year-on-year to USD 26.49 billion. Operating profit rose 4 percent to USD 7.55 billion, and EPS increased 19 percent to USD 4.65. MSM chip shipments totaled 236 million units, up 24 percent year-on-year and 5 percent sequentially.

For fiscal Q1, Qualcomm forecast revenues flat to 9 percent higher year-on-year at USD 6.6-7.2 billion. EPS is expected at USD 1.00-1.12, equal to a decline of 8 percent to 3 percent growth. MSM shipments are forecast up 17-27 percent to 250-270 million. 

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