QUALCOMM stock has been drifting lower for weeks and slipped another 2.6% to about US$151 heading into the latest print. Short term traders are clearly on edge. Yet the headline from this quarter is more about what QUALCOMM is trying to build than what just showed up in the share price.

Revenue of US$9.9b and non GAAP earnings per share of US$2.21 sit alongside a chip segment that now leans harder into automotive and data center, not just smartphones. For long term investors, that shift will matter far more than today’s red number on the screen.

Interested in QUALCOMM’s push into automotive and data center chips but wary of short term price swings in the stock? You can compare this setup against list of solid balance sheet and fundamentals stocks (46 results).

Q3 2026 Earnings Summary

• Revenue, Q3 2026 vs. Q3 2025: US$9.95b vs. US$10.37b (declined about 4%)
• Net Income, Q3 2026 vs. Q3 2025: US$2.00b vs. US$2.67b (declined about 25%)
• Basic EPS, Q3 2026 vs. Q3 2025: US$1.89 vs. US$2.44 (declined about 22%)
• Trailing Twelve Month Revenue, Q3 2026 vs. Q3 2025: US$44.07b vs. US$43.26b (up about 2%)

Prefer clean, visual charts over scrolling through earnings tables and raw figures? See QUALCOMM’s full financial picture with a clear view of its valuation profile in the company report for QUALCOMM.

Qualcomm’s Bull Story Hinges On Non Handset Milestones

The bullish pitch on Qualcomm is that shrinking handset reliance will be replaced by faster growing, higher margin non handset businesses in automotive, IoT and data center. Q3 gives some firm checkpoints. QCT non handset revenue rose 28% year on year and now includes record automotive revenue of US$1.6b, up 61% year on year, and IoT at US$1.8b, up 9% year on year. That is real mix shift progress against a handset segment held back by weaker smartphones and Apple migration.

On the AI and data center pivot, milestones are earlier but tangible. Two custom data center ASIC deals are already in wafer production, with revenue scheduled to start in the December quarter and ramp through fiscal 2027. Completion of the first high bandwidth compute chip tape out and the Modular acquisition also line up with the narrative that Qualcomm is building an AI platform, not just selling phone chips.

Compare QUALCOMM’s push into autos, IoT and AI data center with what the market is currently pricing in. See the consensus price target analysis for QUALCOMM to check whether Wall Street’s consensus aligns with this bullish setup or is signaling a very different path.

Bear Fears On Handsets And Margins Largely Intact For Qualcomm

The bearish view is that Qualcomm’s handset and licensing cash engines are weakening faster than new AI and auto revenues can fill the gap. Q3 numbers do not fully disprove that. Net income fell about 25% while revenue slipped about 4%, which fits the concern that profit pressure is sharper than the top line. Handset chips are described as weaker, with Android softness and faster Apple migration, and Q4 guidance again leans on roughly flat handset revenue with help from Android rather than a broad recovery.

Bears also worry about structurally lower margins as costs rise. Management openly flagged higher input and memory costs and a weaker premium mix. The fix is double digit price hikes that only phase in over several quarters. That is a credible response, but it also confirms that the near term margin drag is real and not yet resolved.

After a quarter where Qualcomm is leaning on price hikes to offset weaker mix and higher costs, you may want to know if this margin pressure is an isolated phase or a sign of deeper fragility. Review the risk analysis for QUALCOMM which shows 3 important warning signs

Take Control of Your Next Move

If QUALCOMM’s push into automotive and AI data center has your attention but the recent share price pullback gives you pause, register for free with Simply Wall St and add it to a Watchlist to track price against fair value and wait for an entry point that suits your plan. Once you are invested, keep your focus on what matters most by using the Portfolio Command Center to cut through noise and surface the key updates on QUALCOMM and your other holdings. For a broader view on sentiment and potential catalysts, tap into thousands of investor perspectives through the Community. This may help you spot potential opportunities and risks early and stay a step ahead of the market.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.