Qualcomm Inc., currently the biggest mobile phone chip manufacturer in the world, made a statement announcing that its profit for the second-quarter of 2014 rose by 5%, but forecast third-quarter profit and revenue that may fail to reach some analysts forecasts.
The company revealed its projection for the quarter through June, saying that its revenue is expected to be between 6.2 and 6.8 billion dollars.
In comparison, according to data compiled by Bloomberg, the analysts estimates amount to 6.6 billion dollars. Qualcomm Inc. also said that it expects its profit to be between 1.15 and 1.25 dollars per share, trailing the analysts forecasts of 1.25 dollars apice.
Moreover, the company is facing some short-term problems related to its expansion in China. According to the Chief Executive Officer of Qualcomm Inc. – Mr. Steve Mollenkopf, the weaker phone sales in the region can be explained by the decreasing clients interest towards phones, which are based on older technology.
Mr. Mollenkopf said in a Bloomberg interview: “The launch of LTE in China is very important to Qualcomm, and it’s difficult to predict.”
Qualcomm also shared that it may deal with some enforcement procedures initiated by the US Securities and Exchange Commission, which investigates bribery allegations in China. The company, however, does not believe any anti-bribery laws were violated. The general counsel of the company – Mr. Don Rosenberg said on a conference, which was cited by Bloomberg: “The Wells notice is a reflection of the regional staff’s preliminary recommendation. We’ve responded with what we think are good arguments as to why we think there isn’t a violation.”
The official representatives of the Securities and Exchange Commission failed to immediately respond to the requests to comment on the procedures.
Qualcomm Inc. was 0.12% up to close at 80.71 dollars per share yesterday, marking a one-year change of +23.50%. According to the information published on CNN Money, the 37 analysts offering 12-month price forecasts for Qualcomm Inc. have a median target of 85.00, with a high estimate of 100.00 and a low estimate of 50.00. The median estimate represents a +5.32% increase from the last price of 80.71.
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