Spreadtrum Communications Earnings: Here’s Why the Stock is Rising Now

Spreadtrum Communications Inc. (NASDAQ:SPRD) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are down up 0.17%.

Spreadtrum Communications Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 131.71% to $0.95 in the quarter versus EPS of $0.41 in the year-earlier quarter.

Revenue: Rose 60.46% to $277.8 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Spreadtrum Communications Inc. reported adjusted EPS income of $0.95 per share. By that measure, the company beat the mean analyst estimate of $0.72. It beat the average revenue estimate of $274.07 million.

Quoting Management: Commenting on the second quarter 2013 results, Chairman and CEO Dr. Leo Li said, “In the second quarter we saw very strong demand for entry-level smartphones based on our single-core smartphone chipsets. We expect this trend to continue well into 2014 as wireless subscribers replace feature phones with their first smartphone. In the second quarter, we increased our market share in midrange handsets as well, having achieved volume shipments of our dual-core smartphone chipsets to both China and global handset makers. Further, we are now shipping our first WCDMA chipset in volume, which expands our addressable market to include global 3G devices. The adoption of this chipset by the world’s largest handset maker is a validation of the product quality and maturity we are now bringing to this market segment.”

Key Stats (on next page)…

Revenue increased 46.97% from $189.02 million in the previous quarter. EPS increased 150% from $0.38 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.64 to a profit $0.79. For the current year, the average estimate has moved up from a profit of $2.34 to a profit of $2.53 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)