Tech & AI
Qualcomm Handset Sales Fall 26% as Car Chips Pass $2 Billion and Data-Centre Push Begins
The chipmaker reiterated a $5 billion data-centre revenue target for fiscal 2027 and announced an AI collaboration with Amazon.
HedgeWeekly Tech & AI Desk ·
Qualcomm reported fiscal fourth-quarter revenue of $10.32 billion, down 8% from a year earlier. Adjusted revenue was $10.44 billion, down 7%, and adjusted earnings fell 28% to $2.17 a share. Standard earnings were $1.17 a share, against a loss of $2.89 a year earlier.
The weakness was in phones. Handset chip revenue fell 26% to $5.14 billion. Offsetting some of that, automotive revenue rose 89% to $1.99 billion, close to a record, and the release called it the first quarter in which that business reached $2 billion. Internet-of-things sales, covering connected devices, rose 4% to $1.89 billion, while licensing revenue fell 7% to $1.30 billion.
For the December quarter Qualcomm guided to revenue of $10.4 billion to $11.2 billion and adjusted earnings of $2.15 to $2.35 a share. The chief executive repeated a fiscal 2027 data-centre revenue target of $5 billion and said sales outside handsets should grow by more than 60%. The company also announced a multi-generation product collaboration with Amazon for AI data centres, and returned $2.0 billion to shareholders in the quarter.
Why it matters: Qualcomm is trying to reduce its reliance on the phone cycle by moving into cars and AI servers, where Nvidia and AMD are far larger. The guidance implies handsets remain under pressure near term, so the market will look for evidence that data-centre orders turn into revenue on the $5 billion timetable.