Qualcomm’s earnings and revenue dipped last quarter as smartphone chip revenue faltered, but shares soared 13.5% in after-hours trading after it said it would begin shipping its first data centre chips later this year.
Earnings per share were down 7% year-over-year to US$2.65, but above Zacks consensus estimates of $2.57. Revenue dropped 3% to $10.60 billion, missing estimates by 0.2%.
“We are pleased to deliver results in line with our guidance, reflecting solid execution as we navigate a challenging memory environment,” said president and CEO Cristiano Amon.
“We are in a period of profound industry transformation — the rise of AI agents is reshaping our roadmap across every platform we develop.”
Revenues for its QCT segment fell 4% to $9.08 billion, largely due to a 13% fall in handset chip sales. This comes amid a decline in the smartphone market as prices for memory components surge, with global smartphone shipments down 6% in 2026’s first quarter.
Its QTL segment, which includes Qualcomm’s licensing business, saw revenue increase 5% to $1.38 billion.
Qualcomm’s guidance for fiscal 2026’s third quarter projects revenue of $9.2-$10.0 billion, below LSEG-compiled estimates of $10.27 billion. It also forecast QCT revenue of $7.9-8.5 billion and earnings per share of $2.10-2.30, under estimates of $2.45.
“A leading hyperscaler custom silicon engagement is on track for initial shipments later this calendar year,” Amon also said.
The company did not provide further details, but said it planned to do so on Qualcomm’s June investor day. It first announced in October that it would begin producing data centre chips.
Qualcomm will also work alongside chipmaker MediaTek to develop processing chips for a new OpenAI smartphone, TF International Securities analyst Ming-Chi Kuo said on Monday.
Qualcomm (NASDAQ: QCOM) shares closed 4% higher at $156.00, and surged 13.5% after-hours. Its market capitalisation is $166.45 billion.
