To The Moon

$Qualcomm(QCOM)$ will be reporting its Q4 results on 01 Nov 2023 (Wednesday). Market is expecting an earning per share of $1.91 on revenues of $8.52 billion for the reported quarter. Qualcomm is expected to beat the Q4 estimates because of an increase in demand from Android smartphones, their continued improvement of the Snapdragon 8 Gen 2 processors, there is also the healthy demand for $Apple(AAPL)$ iPhone 15. But in 2024, there are some headwinds expected because Qualcomm is losing share at Samsung and Huawei. Qualcomm should beat estimate and also raise its guidance because there have been a rush orders from Android smartphones, this could even account for an increase in sales from Huawei, though it does not use Qualcomm chips. On top of these, there is a possible share loss from Samsung. Strange enough, Qualcomm have not been benefitting from the current surge in Cloud Investments, but I would be looking out whether Qualcomm earnings call would mention or comment on A.I. What would be Qualcomm direction or views on A.I. for its chips? Qualcomm (QCOM) Historical Moves Ahead of Earnings QCOM have moved higher heading into earnings historically. On average, the stock gained 3.1% for the 2 week period before earnings (based on the last 12 quarters of data). But recent 5 trading days session, it showed that QCOM have lose -0.37%, this is something we might need to be cautious as chip makers have a mixed earnings and also stock movement. Qualcomm Historical Stock Price Reaction to Earnings QCOM shares have moved lower in the immediate aftermath of earnings 7 out of 12 previous reports. On average the stock moved up 0.5% in the first day of trading after the company reported earnings. Qualcomm (QCOM) Stock Behavior After Earnings Based on the previous 12 earnings releases, QCOM is more likely to trade lower 1 day after earnings for an average loss of -0.1%. The most recent last earnings, we can see that before and after have a loss of more than 5%. Qualcomm Post Earnings Announcement Drift QCOM share price has drifted down -7.5% post earnings announcement. Using the last 12 quarters data, the average drift between earnings announcements is 2.8%. The current drift represents a negative -0.4 standard deviation move. Current post earnings announcement drift: -7.5% Historical average post earnings announcement drift: 2.8% Historical post earnings drift standard deviation move: ±18.9% QCOM Post Earnings Movement The options market overestimated QCOM stocks earnings move 42%of the time in the last 12 quarters. The predicted move after earnings announcement was ±6.3%on average vs an average of the actual earnings moves of 7.2%(in absolute terms). This shows you that QCOM tended to be more volatile than the options market predicted for the earnings stock price reaction. QCOM Option Open Interest QCOM has a total open interest of 38,020 contracts and a put-call ratio of 0.66 for options expiring Nov 03, 2023 (2 days). I will be paying attention to the highest Call open interest with strike price at $110. QCOM Earnings Implied Volatility Crush QCOM's last earnings implied volatility (IV30) going into earnings was 35.3. The last time QCOM released earnings, the implied volatility dropped to 29.3, resulting in an implied volatility crush of 17%. 5 days after earnings, the 30 day IV was 28.8. Average Implied Volatility Crush For QCOM Earnings: 18% Average 30 Day Implied Volatility 1 Day Before Earnings: 42.9 Average QCOM 30 Day IV for the Day of Earnings: 34.8 Average 30 Day Implied Volatility 5 Days After Earnings: 33.9 Summary Based on what market expectations is saying, there might be still some challenges facing Qualcomm. Last week, Qualcomm introduced new artificial intelligence-focused chips for both PCs and smartphones at its Snapdragon Summit 2023. This is seen as an attempt to make their offerings more diversified and they hope to gain back some market share both in the PC space and generative AI, which has been dominated by $NVIDIA Corp(NVDA)$ In early October, Qualcomm was reported to be slashing 1,258 jobs in California due to an effort to reduce costs because of the continued struggles in the smartphone industry. I will be monitoring Qualcomm share price and price action because it has shown to present downside trading after its earnings. If they are able to beat their estimates and present a very positive guidance and outlook for their chips in the Smartphone market. This might help their share price to move, but will be by a small margins. (I think there is a voting under Daily Discussion today article). Appreciate if you could share your thoughts in the comment section whether you think Qualcomm would produce an increase in share price with a positive outlook on its chips for the Smartphone market? @TigerStars @Daily_Discussion @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts. Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.