Qualcomm FY25Q1 corresponds to the actual calendar period of October/November/December 2024.
Qualcomm FY25Q1 Earnings:
Revenue was $11.669B, up 18% year over year and 14% sequentially, setting a new all-time high.
GAAP gross margin was 55.8%, down 0.8 percentage points year over year and 0.6 percentage points sequentially.
GAAP net income was $3.18B, up 15% year over year and 9% sequentially (the net income peak was $3.73B in FY22Q3).
Non-GAAP net income was $3.83B, up 24% year over year, marking the fifth consecutive quarter of double-digit growth, and up 26% sequentially, setting a new all-time high.
FY25 Q2 revenue is guided to $10.3B-$11.2B, up 10%-19% year over year. GAAP net income midpoint is $2.783B, up 20% year over year. Non-GAAP net income midpoint is $3.142B, up 14% year over year.
The company paid $942M in dividends and repurchased $1.8B of shares this quarter.
Business Segments:
Handset revenue was $7.574B, up 13% year over year, setting a new all-time high, and accounted for 65% of revenue. Driven by the ramp of the Snapdragon 8 Elite and the global adoption of the Snapdragon 8 Elite in the Samsung Galaxy S25 series. China's trade-in subsidies have sustained growth in demand for high-end Android flagships, and related customers' market share continues to rise. Samsung will not alter the company's seasonal pattern (Q1 peak, Q3 trough). 2025 handset unit volumes are expected to be flat to low-single-digit growth.
Apple's baseband share is expected to decline to 20%-100% in 2025, to 20% in 2026, and to 0% in 2027.
Arm decided not to terminate Qualcomm's architecture license agreement. QTL recently completed renewal negotiations with two Chinese OEM handset makers, signing a long-term 4G license with Transsion. FY25 QTL revenue is expected to be consistent with FY24. The Huawei license renewal is still under negotiation and is not reflected in the guidance.
Automotive revenue was $961M, up 61% year over year, marking the 17th consecutive quarter of double-digit year-over-year growth and the sixth consecutive quarter of record revenue, accounting for 8% of revenue.
IoT revenue was $1.549B, up 36% year over year, accounting for 13% of revenue. On the edge networking front, Wi-Fi 7 products have begun shipping, and the company secured 5G fixed wireless access design wins with carriers in North America and India. Platforms powered by X Elite/Plus now number 80, expected to exceed 100 by 2026. FY29 win PC revenue target is $4B, with a $35B SAM and a 12% market share target. X Elite/Plus series captured over 10% share of the U.S. Windows notebook market above $800 in December.
Next quarter handset revenue is expected to grow 10% year over year, with Samsung up sequentially and Apple down sequentially. IoT is expected to grow 15% year over year, and automotive 50% year over year.
Overall, Qualcomm's core handset business outperformed expectations this quarter. Although it secured exclusive flagship placement with Samsung, the day of losing Apple has finally arrived. Watch Apple's in-house baseband shipment share this year.