The Circuit
Episode 93: Arm/QCOM Earnings, Trump Presidency Impact on Semis, NVDA Preview
Nov 11, 2024
Recent earnings from Arm and Qualcomm take center stage, revealing intricate market responses and ongoing lawsuits. Qualcomm's shift towards automotive markets unveils new revenue streams amidst supply chain challenges. The potential impact of a second Trump presidency on semiconductor policies raises eyebrows, especially regarding trade dynamics. The discussion also highlights Nvidia's soaring demand amidst supply constraints, showcasing the cyclical nature of the semiconductor landscape and the hurdles that lie ahead.
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Quick takeaways
- Arm's strong earnings reflect confidence amid legal challenges, while Qualcomm's diversification into the automotive sector shows promising revenue growth potential.
- Political changes may significantly impact semiconductor policy, particularly concerning tariffs and domestic production efforts amidst market uncertainties.
Deep dives
ARM’s Earnings and Guidance Outlook
ARM reported solid earnings for the quarter along with optimistic guidance for the upcoming period, although they maintained their full-year expectations, indicating potential reductions in Q4 results. The company confidently addressed a lawsuit with Qualcomm during their earnings call, stating that they had not factored in any favorable outcomes from the case into their financial models. Despite these challenges, ARM appears focused on managing analysts’ expectations conservatively to ensure they can meet or exceed them moving forward. A broader discussion also emerged about how fluctuations in licensing agreements and royalty revenue can affect their financial outlook, illustrating the complexities of revenue recognition timing.
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