Qualcomm beat estimates but warned of broader input-cost and handset-demand pressure.
Why it matters: Qualcomm's forecast offers an early read on pressure across smartphones and semiconductors. Investors focused on near-term handset weakness despite growth in automotive and data-center businesses.
- Qualcomm forecast fiscal first-quarter 2027 revenue of $10.4 billion to $11.2 billion, versus analyst expectations of about $10.48 billion.
- Handset revenue fell 26% year over year to approximately $5.14 billion in the fiscal fourth quarter.
- The company said costs were rising across wafer fabrication, assembly, testing, advanced packaging, memory and other materials.
- CNBC reported that Qualcomm shares fell approximately 7% in extended trading after the earnings release.
Qualcomm beat quarterly expectations but issued a forecast that underscored pressure on its core smartphone business. Fiscal fourth-quarter non-GAAP revenue was $10.442 billion and non-GAAP diluted earnings per share were $2.17, compared with analyst expectations of about $10.1 billion and $2.16, respectively. CNBC reported that shares fell approximately 7% in extended trading after the earnings release.
Qualcomm forecast fiscal first-quarter 2027 non-GAAP revenue of $10.4 billion to $11.2 billion and earnings per share of $2.15 to $2.35. Analyst expectations were approximately $10.48 billion in revenue and $2.27 in earnings per share, according to the same earnings report.
The handset division generated approximately $5.14 billion in quarterly revenue, down 26% year over year. Total QCT semiconductor revenue fell 8% to approximately $9.02 billion. Qualcomm said the semiconductor industry was experiencing broad-based increases in costs for wafer fabrication, assembly, testing, advanced packaging, memory and other materials. It said the full benefit of pricing actions was not expected in QCT gross margins until the second half of fiscal 2027. Qualcomm's SEC-filed earnings materials described the increase as broad-based.
Market data points to broader smartphone pressure. Counterpoint Research said global smartphone shipments fell 20% year over year in the third quarter of 2026, while global smartphone SoC shipments declined 21% amid higher memory costs, longer replacement cycles and cautious inventories.
Qualcomm is trying to offset handset weakness. Automotive revenue was a record approximately $1.99 billion, up 89% year over year, and the company reiterated a target of $5 billion in data-center revenue for fiscal 2027, according to its SEC-filed earnings materials.
By the numbers
- $1.99 billion - Qualcomm's record quarterly automotive revenue, up 89% year over year
- $5 billion - Qualcomm's reiterated data-center revenue target for fiscal 2027
- $10.4 billion to $11.2 billion - fiscal first-quarter 2027 revenue forecast
Yes, but: Qualcomm cited broad-based input-cost increases and did not quantify how much memory costs contributed specifically. It also said pricing actions would not fully benefit QCT gross margins until the second half of fiscal 2027.
What's next: Qualcomm's fiscal first quarter of 2027 will provide the next update on handset demand, pricing actions and margin impact.