Qualcomm stock drops 9% as phone chip sales dive

Shares of Qualcomm fell astir 9% successful pre-market trading Thursday, a time aft the chipmaker reported weaker-than-expected quarterly gross and guidance arsenic it continues to spot declining income for smartphone chips.

Qualcomm's third-quarter earnings bushed connected the apical line, reporting adjusted net per stock of $1.87 versus a Refinitiv statement estimation of $1.81 per share.

But that triumph was overshadowed by weaker-than-expected revenue, astatine $8.44 cardinal adjusted versus an $8.5 cardinal expert statement estimate, and little than anticipated guidance for the upcoming quarter. Qualcomm expects net of betwixt $1.8 and $2 per stock connected income ranging from $8.1 cardinal to $8.9 billion.

Analysts had been hoping for $1.91 per stock net and $8.7 cardinal successful revenue, according to a Refinitiv survey of analysts. Net income besides dropped 52% compared to the year-ago quarter, from $3.73 cardinal to $1.8 billion.

Qualcomm is much exposed than astir due to the fact that of its dense reliance connected high-end and low-end Android telephone sales. Handset spot income declined 25% twelvemonth implicit year, to $5.26 billion.

Deutsche Bank expert Ross Seymore minced nary words successful a Thursday note, downgrading Qualcomm to a clasp and cutting his terms people from $130 to $120. "We judge assurance successful the co's maturation imaginable volition stay challenged," helium wrote successful a missive to clients.

CNBC's Kif Leswing and Michael Bloom contributed to this report.