Qualcomm shares rise more than 12%, global chip shortage will continue into second half of next year

Qualcomm shares rose more than 12% on Thursday, a day after it reported September-quarter earnings that not only beat Wall Street's expectations but also included bullish guidance for the December quarter.

Part of the reason for the strong guidance is that leading semiconductor company Qualcomm is more optimistic than many of its rivals about a global chip shortage. Apple, for example, said a chip shortage will cost it more than $6 billion in 12Q.

Qualcomm Chief Executive Cristiano Amon said Wednesday that it expects its own supply problems to substantially improve by the end of December and that the company will have enough supply to meet demand in the second half of next year.

That's earlier than Intel's prediction of the end of the global chip shortage, which would last until 2023, and closer to AMD's, which said challenges related to chip supply would continue into the second half of 2022.

“Prior to the supply issues, we had been cautious about Qualcomm, but these are now fading away,” Goldman Sachs analyst Rod Hall wrote in a note on Wednesday.

Amon said Qualcomm's ability to increase chip revenue by 56% during a global shortage is a result of the company's actions earlier this year, and new capacity from suppliers planned months and years ago is starting to come online.

"The supply is going exactly as we planned," Amon told CNBC on Thursday. "Scale helps, we tackled that early on... We had a capacity plan and it worked exactly as we planned."

Here's why Qualcomm is able to address the ongoing chip shortage and why it's optimistic about next year.