Qualcomm CEO Cristiano Amon gives a keynote speech at Computex in Taipei, Taiwan on June 1, 2026.
Anne Wang | Reuters
Qualcomm reported fiscal third-quarter earnings on Wednesday, which was in line with analyst expectations, but the company’s outlook for this quarter’s earnings on inline revenue was subdued due to continued supply shortages of computer components, particularly memory. Stock prices fell in after-hours trading.
Chief Executive Officer Cristiano Amon said in an interview that Qualcomm is taking concrete steps to expand future profit margins, including raising the price of its chips across the board starting Sept. 1 (most of which are currently being offered to smartphone makers) and exploring other ways to streamline its supply chain.
“Costs will go up, prices will go up,” Amon said.
Here are the chipmaker’s results for LSEG’s consensus estimates:
EPS: Adjusted $2.21 (estimated $2.23) Revenue: $9.95 billion vs. estimated $9.67 billion
Qualcomm said it expects adjusted earnings per share for the current quarter to be between $2.05 and $2.25, with revenue between $9.7 billion and $10.5 billion. Analysts polled by LSEG expected adjusted earnings per share of $2.36 on sales of $10.02 billion.
“The semiconductor industry is experiencing widespread increases in input costs across wafer fabrication, assembly, test, advanced packaging, memory and other materials,” Qualcomm said in a release, but as management noted, “revenues remain healthy.”
Although the company’s mobile phone business still accounts for the largest portion of its chip sales, Amon’s Qualcomm is looking to diversify into cars, smart glasses and robots, and aims for 60% of the company’s sales next year to come from non-smartphone sales.
Qualcomm reported mobile device chip sales of $5.1 billion, down 20% on an annual basis, which the company said reflects the bottoming out of the Chinese market.
Amon said that trends in the smartphone market have made low- and mid-range mobile phones less competitive due to price issues. He also said customers are looking for lower prices on premium Android phones, which are dominated by Qualcomm.
“Due to rising memory prices, consumer preferences within the luxury category are shifting toward favoring the lower end of luxury products, not just the phones of yesteryear,” Amon said.
“Gross margins are also changing because of the higher supply costs that you’re hearing about,” Amon added. “This is temporary and short-term and we are responding with price increases.”
Qualcomm’s automotive business was a bright spot. Qualcomm reported auto sales of $1.59 billion. The company announced in June that it aims to achieve $10 billion in auto sales by 2029. On Wednesday, it announced a chip supply agreement with BMW for digital cockpit chips.
The company also aims to tap into the fast-growing AI data center infrastructure market. Amon said data center revenue is on track to reach $5 billion next year. Qualcomm also announced Wednesday that it has completed the acquisition of Modular, a buzzy software company that develops programming technology for AI, and that the company will unveil its AI software platform at a conference in August.
The company’s low-power industrial chips and smart glasses are reported as Internet of Things revenues. The division’s sales rose 9% annually to $1.83 billion.
Net income for the period was $2.0 billion, down 25% from $2.66 billion in the same period last year.
Qualcomm makes significant profits through its QTL division, which licenses intellectual property related to cellular connectivity and other chip technologies to other companies. Qualcomm’s QTL revenue was $1.28 billion, beating Street estimates of $1.26 billion.
