Qualcomm Beats Forecasts, Faces Samsung Setback

Chip designer Qualcomm delivered a strong earnings outlook on Wednesday, signaling a rebound in premium smartphone sales — but investor optimism was dampened by news that the company could lose part of its business from Samsung next year.

For the quarter ending in December, Qualcomm expects revenue of around $12.2 billion and adjusted profit of $3.40 per share, both above Wall Street expectations of $11.62 billion and $3.31 per share, according to LSEG data. The upbeat forecast reflects rising global demand for high-end smartphones capable of running AI-powered apps.

However, CEO Cristiano Amon revealed that Qualcomm expects to supply only 75% of modem chips for Samsung’s next-generation Galaxy S26 lineup, down from 100% in the current Galaxy S25 models. The announcement triggered a 2.7% drop in Qualcomm’s shares during after-hours trading, despite a 4% gain earlier in the day.

Growth Beyond Smartphones

As Apple gradually transitions to its own in-house modem chips, Qualcomm has been diversifying into laptops, cars, and data center chips. Amon confirmed that the company is in talks with a “large AI computing firm,” hinting at growing opportunities in the AI infrastructure space.

In the recently concluded fiscal year, Qualcomm’s non-Apple revenue grew 18%, while handset chip revenue rose 14% to $6.96 billion, surpassing market estimates. CFO Akash Palkhiwala projected that handset revenue could grow by low teens in the next quarter, implying at least $7.7 billion in sales.

AI Demand Drives Premium Phone Market

Amon attributed Qualcomm’s strong performance to consumers upgrading from mid-range to premium devices to handle new AI features. “You don’t have anything in the middle,” he noted, describing a global shift in smartphone buying trends visible in both China and India.

For the fiscal fourth quarter ending September 28, Qualcomm reported $11.27 billion in revenue and $3 per share in adjusted profit — both ahead of analyst expectations.

While the company’s short-term outlook remains strong, uncertainty around Samsung’s next-generation orders and Apple’s ongoing shift to proprietary chips could shape Qualcomm’s path ahead. For now, the AI wave appears to be keeping the chipmaker’s growth engines running.