Qualcomm Handset Revenue Falls 26% as Automotive Chips Surge

Qualcomm’s latest earnings capture an abrupt contrast in the chipmaker’s business. Fiscal fourth-quarter handset revenue fell 26% from a year earlier to $5.14 billion, while automotive chip revenue jumped 89% to $1.99 billion. Overall revenue declined 8% to $10.32 billion, according to the company’s results released on 4 November.

The figures show why Qualcomm wants investors to look beyond smartphones. Phone chips remain a much larger source of sales than automotive processors, but the two lines moved in opposite directions during the quarter. The automotive business was close to the $2 billion quarterly mark, up from $1.05 billion a year earlier, while handset sales fell from $6.96 billion.

Qualcomm’s chip segment, known as QCT, generated $9.02 billion in fourth-quarter revenue, down 8%. Its licensing division, QTL, brought in $1.30 billion, down 7%. Internet-of-things chip revenue rose 4% to $1.89 billion. The result was a company still heavily exposed to phones, despite faster-growing businesses elsewhere.

For the full fiscal year, Qualcomm recorded $43.12 billion in revenue, down 3% from $44.28 billion in fiscal 2025. GAAP earnings per share rose sharply to $12.70, but that figure included a $5.7 billion tax benefit tied to a valuation allowance. Its adjusted earnings per share fell to $10.54 from $12.03. Readers should not interpret the jump in statutory earnings as evidence that the core operating business grew at the same rate.

Qualcomm says it has renewed long-term patent licensing agreements with Apple, Huawei and Transsion. The inclusion of Transsion is particularly relevant to the smartphone market across Africa, where the company’s Tecno, Infinix and itel brands have a large presence. A licensing renewal is not the same as a guarantee of future chip orders, but it does preserve an important commercial relationship.

Chief executive Cristiano Amon said combined automotive and internet-of-things revenue grew 36% year on year in the quarter. Qualcomm expects its non-handset revenue to rise more than 60% in fiscal 2027, and reiterated a $5 billion data-centre revenue target for that year. It has also announced a multi-generational AI data-centre product collaboration with Amazon. These are forward-looking targets, not revenue already earned.

The ambition puts Qualcomm in a wider contest to supply AI computing beyond the phone. Its automotive growth suggests it has already established demand for processors in connected vehicles, but data centres are a different market with different performance, software and customer requirements. The next year will show whether the company can turn its new products and partnerships into substantial sales while handset demand remains uneven.

For the first quarter of fiscal 2027, Qualcomm forecasts revenue of $10.4 billion to $11.2 billion. It also warned that rising costs across chip fabrication, packaging and memory are affecting the industry, with pricing actions expected to help margins later in fiscal 2027. TechBooky has previously covered Qualcomm’s investment in AI capabilities; this earnings release makes the business question more immediate. Can cars and AI infrastructure grow quickly enough to offset a weaker handset cycle?