UPDATE 3-Qualcomm quarterly revenue beats Street; stock up

Wed Jul 24, 2013 7:34pm EDT
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(Adds comment from CEO, rewrites first paragraph)

By Noel Randewich

SAN FRANCISCO, July 24 (Reuters) - Qualcomm Inc posted third-quarter revenue that beat expectations and earnings that matched them to ease concerns about slower growth of smartphone sales and help push the leading mobile chipmaker's shares up more than 4 percent.

Few semiconductor companies have benefited more from the mobile revolution than Qualcomm, but the supplier of chips for Apple Inc's iPhones and Android devices has begun to face pressure as growth in smartphone sales shifts to Asia.

In its fiscal third-quarter report on Wednesday, Qualcomm met analysts' expectations for earnings and was ahead on revenue.

"It looks like momentum is continuing. It doesn't feel like the smartphone story is over," Bernstein analyst Stacy Rasgon said.

In Apple's quarterly report on Tuesday, the Cupertino, California, company said it sold more iPhones than Wall Street had expected. Samsung Electronics Co, which overtook Apple to become the world's largest smartphone maker in 2012, had fueled concerns about smartphone sales when it issued a disappointing earnings forecast earlier this month.

"There seems to be some concern that developed regions are becoming saturated with smartphones," Qualcomm CEO Paul Jacobs said on a conference call with analysts.

He went on to say that over the long-term, Qualcomm expects only a modest decrease in smartphone replacement rates in developed countries thanks to incentives offered by carriers to their subscribers.   Continued...