©Reuters. FILE PHOTO: Qualcomm and 5G signs are pictured at Mobile World Congress (MWC) in Shanghai, China, June 28, 2019. REUTERS/Aly Song/File Photo
(Reuters) – Qualcomm Inc on Wednesday forecast second-quarter sales to be above Wall Street estimates amid rising demand for its chips, which are used in devices ranging from phones to internet-enabled gadgets, amid a Rise in 5G and cloud adoption.
With the rollout of 5G services in the United States and growing global adoption, Qualcomm (NASDAQ:) is poised to win with its flagship chips that enable phones to connect to cellular data networks.
The company continues to benefit from Huawei Technologies' exit from the smartphone market, which has led many other Chinese phone brands including Xiaomi (OTC:), Honor and Oppo to turn to Qualcomm for their chip needs.
“Android drives growth. Android is showing revenue growth of over 60% year over year in our results…the shift in the OEM mix in China presents tremendous opportunities and we're taking advantage of them," Qualcomm Chief Financial Officer Akash Palkhiwala told Reuters.
According to Refinitiv IBES data, the company is forecasting revenue of between $10.2 billion and $11 billion for the current quarter, compared to analyst estimates of $9.61 billion.
Revenue for the first quarter was $10.7 billion, compared to analyst estimates of $10.42 billion, according to data from Refinitiv IBES.
According to data from FactSet, the chip segment generated revenue of $8.85 billion in the first quarter, beating analysts' expectations of $8.69 billion.
Net income increased to $3.69 billion, or $3.23 per share, from $2.51 billion, or $2.17 per share, in the prior year.
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