Qualcomm falls 3% as handset revenue misses estimates, costs rise

Qualcomm Inc. (NASDAQ: QCOM) shares fell 3% after the chipmaker reported weaker-than-expected handset revenue and warned of rising semiconductor input costs, overshadowing quarterly earnings that topped analyst estimates.

Qualcomm reported fourth-quarter adjusted earnings of $2.17 per share, slightly above the $2.16 consensus, while adjusted revenue of $10.44 billion exceeded expectations of $10.12 billion. However, handset revenue fell 26% year over year to $5.14 billion, missing estimates of $5.25 billion.

Total revenue declined 7% from $11.27 billion a year earlier. Qualcomm forecast first-quarter revenue of $10.4 billion to $11.2 billion, with a midpoint of $10.8 billion above the $10.55 billion consensus. Adjusted earnings guidance of $2.15 to $2.35 per share, however, came in slightly below the $2.32 estimate at the midpoint.

The company said the semiconductor industry is facing broad-based increases in costs across wafer fabrication, assembly, testing, advanced packaging, memory and other materials. Qualcomm expects pricing actions to deliver their full benefit in the second half of fiscal 2027.

Automotive revenue surged 89% year over year to $1.99 billion, beating estimates of $1.69 billion and marking the segment’s first quarter approaching $2 billion. Internet of Things revenue rose 4% to $1.89 billion, also exceeding expectations.

The QCT semiconductor business generated $9.02 billion in revenue, down 8% year over year but above the $8.8 billion consensus. QTL licensing revenue declined 7% to $1.30 billion, slightly ahead of estimates of $1.29 billion.

“We are pleased to deliver fourth quarter non-GAAP revenues at the high end of our guidance, along with 36% year-over-year growth in combined QCT Automotive and IoT revenues,” said Cristiano Amon, Qualcomm’s president and chief executive.

“Fiscal 2027 marks the start of our non-handset revenue inflection, including the ramp of our Data Center business,” Amon added.

For fiscal 2026, adjusted revenue declined 2% to $43.24 billion, while adjusted earnings per share fell 12% to $10.54.