Qualcomm’s Q1 revenue declines 12% year-over-year

Yahoo Finance Live anchors discuss the decline in stock for Qualcomm.

Video Transcript

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- Qualcomm wasn't immune to the broader tech slowdown its most recent quarter with sales dropping 12%. Operating profits were also under pressure. Really, this quarterly weakness driven by pressure on the handset business. That is, of course, things we've seen in the likes of Apple last night as well. IPhone sales are under pressure as well. But Citi's saying this is a difficult time in handsets. And if you take the handset business and the internet of things business for Qualcomm, that makes up about 77% of their fiscal first quarter sales what they just reported.

- Yeah, and that's something that investors are looking to more and more, and the company has really touted more and more is outside of the handset business, what else is working? Initially, the Qualcomm shares actually went up after they reported their results. Automotive sales were up 58%. You mentioned connected devices I believe up 7%.

However, if you're thinking about the overall revenue of the company's $9.46 billion, automotive sales is $456 million. Connected devices is $1.68 billion. In other words, yes, those areas are growing, but they're still very small as a proportion of the total company.

- That's compared to an excess of $5.7 billion for the Q1 fiscal 2023.

- For the handsets.

- For handsets. Yeah, exactly. And so, really thinking about how they continue to not just move more into the automotive landscape, or at least kind of lessen the dependency on that handset business knowing how much Apple, how much Samsung, how much some of the other manufacturers have proven that they are ready to throw their weight around and, perhaps, have a little bit more vertical integration.

That's a red flag for Qualcomm, right now at least. And so, just a larger question of where you continue to have that demand generated in this near term as well, given the shift that you've seen from some of those large historical purchasers from the business too.