Qualcomm’s Profit Soars Amid Sales Surge

Boosted by the popularity of mobile phones with cameras and color screens, Qualcomm Inc. on Wednesday posted a 46% jump in profit in its fiscal first quarter.

Qualcomm, which pioneered the wireless technology used by Verizon Wireless and Sprint PCS, reported net income of $352.3 million, or 43 cents a share, for the three-month period ended Dec. 28. It earned $241.3 million, or 30 cents a share, during the same period a year earlier. Sales rose 13% to $1.24 billion from $1.1 billion.

San Diego-based Qualcomm benefited partly from gains by industry-leading Verizon Wireless. Qualcomm’s upbeat forecast for its current fiscal year -- a 40% to 45% spurt in earnings and a 6% to 10% hike in revenue -- is based partly on its decision to roll out nationwide its high-speed, data-only service.

The Verizon Wireless network and handsets use Qualcomm technology known as CDMA, or code division multiple access. Though dominant in the U.S., CDMA is second worldwide to GSM, or global system for mobile communications. But CDMA is gaining, particularly in Asia and India.

“They’re stronger than they look and seem,” said analyst Thomas Sepenzis at investment banker ThinkEquity Partners in San Francisco. “Qualcomm is going to emerge in a year or two as one of the dominant wireless players worldwide.”

Qualcomm owns most of the rights to the CDMA technology, and royalty fees accounted for 28% of its quarterly revenue.

But it also owns a chunk of technology rights in GSM’s future, the third generation of mobile phones with high data speeds.

Excluding its Qualcomm Strategic Initiatives investment arm, Qualcomm earned $419 billion, or 51 cents a share, for the quarter. Analysts had been expecting 48 cents a share.

Shares fell 11 cents to $58.77 in regular Nasdaq trading and were as low as $58.57 in after-hours trading after the earnings announcement.