Qualcomm’s Third Quarter Results Reflect Mixed Outcomes

Qualcomm exceeded analyst expectations for its third quarter, yet shares dropped on Thursday morning.

• While the chipmaker saw revenue growth, it was not as robust as projected, with its outlook for the fourth quarter largely aligning with analyst forecasts.

• Analysts from JPMorgan predict that Qualcomm’s revenue growth may be “constrained” over the next couple of years, particularly as Apple, one of its key customers, makes changes.

After announcing its third-quarter outcomes, Qualcomm (QCOM) witnessed a decline in stock prices on Thursday. The company reported revenues of $10.37 billion, a 10% increase from last year. Meanwhile, the earnings per share rose nearly 20% to $2.77. Revenue figures came in fairly close to analysts’ expectations, while the EPS notably surpassed consensus estimates from Visible Alpha.

CEO Cristiano Amon highlighted that Qualcomm’s expanding sectors, including automotive and the Internet of Things, have shown impressive growth, boasting increases of over 20% this quarter. However, total revenues from the automotive, IoT, and smartphone chip segments, known as “QCT” revenues, reached about $89.9 billion, slightly falling short of analyst predictions.

Looking ahead, Qualcomm anticipates fourth-quarter revenues between $10.3 billion and $11.1 billion, with EPS ranging from $2.75 to $2.95. The average of these estimates, roughly $10.7 billion in revenue and $2.85 in EPS, aligns with current analyst forecasts.

To diversify its revenue sources, Qualcomm is strategizing for a future where it may lose Apple as a customer. Apple is transitioning to manufacturing its own modems, which Qualcomm previously supplied. The company is also making acquisitions aimed at boosting its presence in the data center sector.

“We expect our overall revenue growth to be limited to single-digit percentages in FY26 and FY27, primarily due to anticipated losses from Apple,” a representative commented.

In the midst of these developments, Qualcomm’s stock took a hit, dropping around 4% during intraday trading, pushing it back into negative territory for the year.

Update – This article has been revised to include the latest stock price details.