Qualcomm has now released its financial results for the second quarter of fiscal year 2018, with projections looking good according to CEO Steve Mollenkopf, following better than expected performance for the quarter. That optimism centers around the company's GAAP revenues, which rose 5-percent year-over-year (YoY) to land at $5.3 billion, as well as lower operating expenses more than expected. The executive also says that Qualcomm is making progress on the execution of its $1 billion cost plan and is currently focused on completing its acquisition of silicone manufacturer NXP Semiconductors. Performance should continue to improve as projected, Mollenkopf says, through 2019 and into the global commercialization of 5G.
However, while the numbers may have posted better than expectations, that doesn't mean they were necessarily great. Delving deeper into the figures, the technology giant's quarter-over-quarter GAAP revenues dropped by 13-percent. Operating income, net income, and diluted earnings were not reported for GAAP on a quarterly basis but fell by 40-percent, 52-percent, and 52-percent respectively year-over-year. For both operating income and net income, Qualcomm reports a final figure of $0.4 billion. Operating cash flow, in the meantime, was down by 37-percent over that same period and by 71-percent from Q1 2018. That fell in at around $0.5 billion. According to the report, a great deal of those losses was the result of problems faced by the company earlier this year. For starters, Qualcomm has undergone a number of structural changes which resulted in around $310 million in losses. Arbitration has played a role, as well, with the company pointing to $974 million in losses associated with a 2016 case involving BlackBerry. Finally, the report lists tax legislation in the U.S. – resulting in a $6 billion charge – and European Commission fines totaling to $1.2 billion in charges.
On the Non-GAAP side of things, those figures actually appear to be worse nearly across the board. So, by all accounts, Qualcomm's figures don't necessarily look all that good at this point. Having said that, the company also seems to be recovering from its recent setbacks and this year's buyout drama well enough. So it wouldn't be surprising to see it return to form on schedule, moving into 2019. The NXP merger, if that moves forward as planned, will likely help with that quite a bit since it will expand further on Qualcomm's offerings.