Cristiano Amon, President of Qualcomm and Qualcomm CDMA Technologies, answers a question during a panel discussion on 5G wireless broadband technology during CES 2018 in Las Vegas, Nevada, the United States, on January 10, 2018.

Steve Marcus | Reuters

Qualcomm reported a profit for the first quarter after the bell on Wednesday.

Adjusted earnings exceeded expectations, but Qualcomm’s revenue was slightly below Wall Street’s expectations, causing the stock to drop over 9% in expanded trading.

Here’s how Qualcomm behaved compared to refinitive consensus estimates:

  • Merits: Adjusted for $ 2.17 per share versus an estimated $ 2.10
  • Revenue: Adjusted for $ 8.23 ​​billion versus an estimated $ 8.27 billion

Both sales and earnings saw strong year-over-year growth as Qualcomm’s business was fueled by 5G smartphones that required chips and intellectual property, and an electronics boom during the pandemic. Revenue increased 63% year over year, while earnings increased 119%.

Qualcomm expects sales between 7.2 and 8 billion US dollars for the current quarter

At the end of last year, Qualcomm announced that it would change the way in which its business units are reported to split sales of cell phones, radio frequencies, automotive and Internet of Things chips. These businesses were previously reported together in Qualcomm’s “QCT” segment.

Chip sales rose sharply, Qualcomm announced on Wednesday. Cell phone chip growth rose 79% year over year to $ 4.22 billion for the quarter ended December. The RF front-end chips, which Qualcomm considers strategically important and which are used in conjunction with Qualcomm’s modems for 5G, increased 157% year over year.

Overall, Qualcomm’s chip business, QCT, posted an 81% year-over-year revenue increase for the quarter.

In January Qualcomm announced it would buy Nuvia, a chip startup founded by Apple veterans, for $ 1.4 billion to strengthen technology for smartphones, laptops and car chips.

Wednesday’s report is the chipmaker’s first since last month announcing that CEO Steve Mollenkopf will retire later this year and be replaced by the company’s current president, Cristiano Amon. Mollenkopf’s resignation comes after seven challenging years that included legal issues with Apple, the Federal Trade Commission, and a hostile takeover attempt by Broadcom.