Global Finance News
05 Nov 2026, 09:31
Qualcomm Plunges 10% Premarket as Handset Weakness and Margin Pressure Overshadow AI Data Center Growth
Qualcomm (NASDAQ: QCOM) shares fell about 10% in premarket trading after the company reported weaker fiscal fourth-quarter revenue and profit, while its near-term outlook highlighted continued margin pressure from rising semiconductor input costs.
Fourth-quarter revenue fell 8% year over year to $10.32 billion, while non-GAAP revenue declined 7% to $10.44 billion. Non-GAAP EPS dropped 28% to $2.17, and QCT earnings before tax fell 26%.
The main weakness came from handsets, where QCT revenue declined 26% to $5.14 billion. By contrast, automotive revenue surged 89% to a record $1.99 billion, while IoT revenue increased 4%.
For fiscal 2027, Qualcomm expects non-handset revenue to grow more than 60% and reiterated its $5 billion data center revenue target, supported by its multi-generational collaboration with Amazon.
However, management also warned that semiconductor input costs are rising across wafers, assembly, testing, packaging and memory. Qualcomm expects pricing actions to fully offset those pressures only in the second half of fiscal 2027.
For fiscal Q1, the company expects revenue of $10.4 billion to $11.2 billion and non-GAAP EPS of $2.15 to $2.35.
The sharp premarket decline appears to reflect investor concern over the 26% drop in handset revenue, lower QCT profitability and near-term cost pressure, despite strong automotive growth and an increasingly important AI data center opportunity.
Qualcomm (NASDAQ: QCOM) shares fell about 10% in premarket trading after the company reported weaker fiscal fourth-quarter revenue and profit, while its near-term outlook highlighted continued margin pressure from rising semiconductor input costs.
Fourth-quarter revenue fell 8% year over year to $10.32 billion, while non-GAAP revenue declined 7% to $10.44 billion. Non-GAAP EPS dropped 28% to $2.17, and QCT earnings before tax fell 26%.
The main weakness came from handsets, where QCT revenue declined 26% to $5.14 billion. By contrast, automotive revenue surged 89% to a record $1.99 billion, while IoT revenue increased 4%.
For fiscal 2027, Qualcomm expects non-handset revenue to grow more than 60% and reiterated its $5 billion data center revenue target, supported by its multi-generational collaboration with Amazon.
However, management also warned that semiconductor input costs are rising across wafers, assembly, testing, packaging and memory. Qualcomm expects pricing actions to fully offset those pressures only in the second half of fiscal 2027.
For fiscal Q1, the company expects revenue of $10.4 billion to $11.2 billion and non-GAAP EPS of $2.15 to $2.35.
The sharp premarket decline appears to reflect investor concern over the 26% drop in handset revenue, lower QCT profitability and near-term cost pressure, despite strong automotive growth and an increasingly important AI data center opportunity.
