Qualcomm Inc (NASDAQ:QCOM) stock fell 6.04% (As on May 4, 12:45:10 AM UTC-4, Source: Google Finance) after the company forecast third-quarter revenue and profit below Wall Street estimates on Wednesday on worries it will take longer for the smartphone industry to exhaust the excess supply before fresh orders start flowing in. . QTL recorded revenues of $1.3 billion and EBT margin of 68%, reflecting lower-than-expected global handset units. On a year-over-year basis, the company estimates global handset sell-in units declined by approximately 14%. QCT revenues of $7.9 billion and EBT margin of 27% were both near the high end of the guidance. Handset revenues increased 6% sequentially to $6.1 billion, benefiting from device launches with Snapdragon 8 Gen 2, the latest premium-tier chipset platform. IoT revenues of $1.4 billion reflected a larger-than-expected impact of macroeconomic environment on demand and channel inventory drawdown. Automotive revenues of $447 million grew 20% year-over-year, driven by the adoption of the Snapdragon digital chassis and are aligned with our long-term revenue target.

QCOM  in the second quarter of FY 23 has reported the adjusted earnings per share of $2.15, missing the analysts’ estimates for the adjusted earnings per share of $2.16, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue of $9.28 billion in the second quarter of FY 20, beating the analysts’ estimates for revenue by 2.15%.

During the second quarter of fiscal 2023, the company returned $1.7 billion to stockholders, including $834 million, or $0.75 per share, of cash dividends paid and $903 million through repurchases of 7 million shares of common stock

The company forecast revenue between $8.1 billion and $8.9 billion. Analysts polled by Refinitiv expected revenue of $9.14 billion. It expects adjusted earnings per share to be between $1.70 and $1.90, compared to analysts expectations of $2.16. The company’s forecast includes the “continued impact of the macroeconomic headwinds, weaker global handset units and channel inventory drawdown”. It also said a larger-than-normal sequential decline in its chip revenue forecast was mainly due “to the timing of purchases by a modem-only handset customer”.  The company forecast revenue for the segment to be between $6.9 billion and $7.5 billion.

The company now expects global 3G, 4G, 5G handset units in calendar ’23 to be down at least a high single-digit percentage relative to calendar ’22, which is lower than the prior expectation.