Qualcomm shares fell in extended trading after the company reported fiscal third-quarter results that missed profit estimates and issued disappointing guidance for the current period. Despite beating revenue expectations, the chipmaker was hit by a sharp rise in component costs, particularly memory, which squeezed margins.
Key earnings numbers: Adjusted earnings per share came in at $2.21, below the $2.23 consensus, as net income dropped 25% year-on-year to $2 billion. Revenue, however, jumped to $9.95 billion, exceeding the $9.67 billion expected. The core handset segment saw chip sales fall 20% annually to $5.1 billion, reflecting structural shifts in smartphone buying patterns—more consumers are choosing budget or prior-year models.
CEO Cristiano Amon outlined plans to raise chip prices starting September 1 to offset elevated input costs, calling the supply chain pressures temporary. For the current quarter, Qualcomm guided adjusted EPS between $2.05 and $2.25, well below the $2.36 consensus, with revenue outlook of $9.7 billion to $10.5 billion.
On the positive side, non-handset businesses shone: automotive revenue reached $1.59 billion, boosted by a new partnership with BMW, and IoT grew 9% to $1.83 billion. The licensing division also beat estimates. Management expects non-smartphone units to represent 60% of revenue next year.
Technically, Qualcomm stock has fallen over 37% from its 2026 high, forming a falling wedge pattern that suggests a possible bullish breakout. Options market implied volatility has spiked to 123%, with a put/call ratio of 0.55 indicating some investor optimism. However, analysts rate the stock a Hold on average.
