Why Qualcomm Stock Is Moving Lower Thursday

Qualcomm Inc QCOM shares are trading lower Thursday on the heels of the company's fiscal second-quarter results. Qualcomm issued weak guidance and several analysts lowered price targets following the print.

What Happened: Qualcomm said second-quarter revenue decreased 17% year-over-year to $9.28 billion, which beat average analyst estimates of $9.1 billion, according to Benzinga Pro. Handset revenue was down 17% year-over-year, while automotive revenue was up 20%.

The company reported quarterly earnings of $2.15 per share, which was in line with analyst estimates.

“As we navigate this challenging environment, we remain focused on the critical factors we can control to emerge stronger from this downturn – our leading technology roadmap, best-in-class product portfolio, strong customer relationships and operational efficiencies,” said Cristiano Amon, CEO of Qualcomm.

Outlook: Qualcomm said it expects third-quarter revenue to be in a range of $8.1 billion to $8.9 billion versus estimates of $9.14 billion. The company guided for adjusted earnings in a range of $1.70 to $1.90 per share versus estimates of $2.16 per share. 

Related Link: Qualcomm Q2 Earnings Highlights: Revenue Beat, Auto Segment Sees Growth, Q3 Guidance And More

On the conference call, Amon noted that Inventory drawdowns could remain a factor for the next couple of quarters. He also said the company has not yet seen evidence of a meaningful recovery in China. 

Analyst Assessment: 

• Keybanc analyst John Vinh maintained Qualcomm with an Overweight and lowered the price target from $160 to $145.
• Deutsche Bank analyst Ross Seymore maintained Qualcomm with a Buy and lowered the price target from $150 to $130.
• Barclays analyst Blayne Curtis maintained Qualcomm with an Overweight and lowered the price target from $150 to $140.
• Baird analyst Tristan Gerra maintained Qualcomm with an Outperform and lowered the price target from $150 to $130.
• Rosenblatt analyst Kevin Cassidy maintained Qualcomm with a Buy and lowered the price target from $170 to $145.

QCOM Price Action: Qualcomm shares were down 8.23% at $103.54 at the time of writing, according to Benzinga Pro.

Photo: courtesy of Qualcomm.