Qualcomm (QCOM) Q3 EPS $2.17 Beats Estimates, Stock Drops 7%

Published on 11/4/2026 · Source: cnbc.com

#QCOM #Earnings #Smartphones #Semiconductors #IOT

Qualcomm (QCOM) Q3 EPS $2.17 Beats Estimates, Stock Drops 7%

AI Summary

Summarized by AI from the source below

Qualcomm (QCOM) reported quarterly earnings per share (EPS) of $2.17, slightly above the expected $2.16. Adjusted revenue was $10.44 billion, meeting expectations. Despite beating estimates, Qualcomm's stock price fell 7% in after-hours trading due to a weaker earnings forecast.

For the current quarter, the company forecasts EPS of $2.15 to $2.35 and revenue between $10.4 billion and $11.2 billion, below analyst expectations of $2.27 EPS and $10.48 billion in revenue. Smartphone-related chip sales declined 26% year-over-year to $5.14 billion, underperforming StreetAccount's $5.21 billion forecast. The memory shortage is causing handset prices to rise, dampening demand. Qualcomm’s handset chip revenue fell 7% annually, though pricing was increased in September.

Qualcomm is shifting focus under CEO Cristiano Amon toward data center chips, with $650 million revenue this quarter and a $5 billion target for fiscal 2027. Automotive chip revenue rose 89% to $1.99 billion, exceeding the $1.66 billion estimate. Internet of Things revenue increased 4% to $1.88 billion, slightly above forecasts. The licensing division (QTL) revenue declined 7% to $1.3 billion but maintained scale with renewed agreements with Apple, Huawei, and Transsion.

This matters because Qualcomm’s forecast signals weakening smartphone chip demand while growth efforts in automotive and data center segments offer partial offset. Investors face near-term revenue pressure from handset market challenges and supply constraints, impacting stock valuation.

Informational only, not financial advice. Content is AI-generated and may contain errors. How this works.

Our take

Opinion from the Newsstocks AI desk, not investment advice

We think Qualcomm is facing near-term challenges from declining smartphone chip sales due to supply constraints and pricing pressures. However, growth in automotive and data center segments shows strategic diversification. The stock decline reflects investor focus on the weaker guidance, but improved supply or stronger demand in growth areas could alter this view.

Key numbers

Adjusted EPS: $2.17
Adjusted Revenue: $10.44 billion
Handset chip sales decline: 26%
Automotive chip revenue growth: 89%

What could help

Qualcomm's automotive chip revenue rose 89%, exceeding expectations.
Data center revenue is growing with a target of $5 billion in fiscal 2027.

What could hurt

Smartphone chip sales fell 26% due to memory shortages and reduced demand.
Earnings guidance came in below analyst expectations, pressuring the stock.

The background

Earnings reports show how much profit and revenue companies make in a quarter. Investors use forecasts to predict future performance and decide to buy or sell stocks.

Questions readers ask

Why did Qualcomm stock drop 7% after earnings?

Qualcomm reported earnings that beat estimates but gave a weaker-than-expected earnings forecast for the next quarter, causing the stock to drop 7% in extended trading.

What caused Qualcomm's handset chip sales to decline?

Handset chip sales declined 26% mainly due to a memory shortage that increased handset prices, reducing demand.

How is Qualcomm diversifying its revenue sources?

Qualcomm is increasing revenue in automotive chips, which rose 89% this quarter, and data center chips, with $650 million in revenue and a $5 billion target for fiscal 2027.