A Money Making Strategy for Qualcomm’s Memory Crisis
Qualcomm (QCOM) shares plunged nearly 9% on February 5, 2026 to $136 because of a dramatic shortfall in forward guidance. The core issue is a global DRAM shortage and surging memory prices, driven by high demand for AI data centers, which has forced smartphone manufacturers (OEMs) to slash production plans and exercise extreme inventory caution. There is fear that this memory overhang could suppress handset shipments well into 2027, turning a strong demand cycle into a deferred revenue problem for the company. But this grim situation comes with an opportunity.
Are we recommending buying Qualcomm stock at this dip? Absolutely not. There is a smarter trade available if you really believe in Qualcomm’s long-term story.
With this drop, the option prices have spiked, and that’s where the money is. If you’d love to buy Qualcomm at a 30% discount at about $95 per share and have some cash ready to go, here is a trade.
You could earn 9.2% annualized yield at 30% margin of safety by selling Put Options.
- Sell a long-dated Put option expiring 1/15/2027, with a strike price of $95
- Collect roughly $461 in premium per contract (each contract represents 100 shares)
- That’s about 5.2% annualized yield on the $9,500 you’re setting aside for the possibility of buying the stock
- This cash parked in a savings or money market account will earn an extra 4.0%, taking total annualized yield to 9.2%
- And you give yourself a chance to buy QCOM stock at deep discounted price of $95
It is as simple as that. You can earn high income while you wait for the current bearish market sentiment to settle down and get Qualcomm stock at even more attractive prices.
This might be a smart opportunistic trade, but it is not the only strategy available. We take it a step further with the Trefis High Quality Portfolio, which is a sophisticated framework designed to protect your wealth while giving upside exposure.
Qualcomm Options Trade Outcomes: You Win Either Way
| Stock Price Outcome | What It Means For You |
|---|---|
| QCOM stays above $95 | You keep the full $461 premium, resulting in “4.9% extra income” over the next 344 days on cash that might otherwise earn you 4.0% or less. You never buy the stock and simply walk away with the cash. |
| QCOM closes below $95 | You’ll be obligated to buy 100 shares at $95. But thanks to $461 premium, your effective cost basis is just $90.39 per share, a roughly 34% discount from current level. |
But to hold this trade with conviction, you want to see long-term upside in the stock. Because if it comes to it, you want to be excited about buying the stock cheap.
First, you want fundamentals to check out. For details, see Qualcomm Investment Highlights
Second, you want to better understand competitive advantage and industry tailwinds.
Why Hold Qualcomm Stock Long-Term
Here is the core thesis.
Current handset weakness is temporary and the market has priced-in a cyclical trough. However, automotive/IoT growth (+15%/+9% YoY) and a cheap valuation (forward 12.3x P/E) present an attractive long term opportunity.
Qualcomm captures value by embedding its Snapdragon Digital Chassis and other chipsets into vehicles and a wide array of IoT devices. This strategy shifts the revenue mix toward secular growth markets with increasing silicon content, driving higher average selling prices (ASPs) and creating a more durable, less cyclical revenue base.
Management has guided for an acceleration in Automotive revenue growth to greater than 35% YoY in Q2 FY26. In Q1 FY26, Automotive (+15% YoY) and IoT (+9% YoY) revenue growth significantly outpaced the core Handsets segment (+3% YoY) and the company has a long-term strategic target to achieve a combined $22 billion in annual revenue from the Automotive and IoT segments by fiscal year 2029.
If you are not comfortable with options or stock-specific trades, Portfolios are the way to go as they can protect and grow wealth even better.
Multi-Asset Portfolios Win Through Market Cycles
Stocks like Qualcomm go through market cycles, and that brings volatility. Managing your wealth through changing market conditions requires moving beyond equities. What if you took advantage of the current commodity super cycle? Is a portfolio of 10% commodities, 10% gold, and 2% crypto in addition to equities and bonds – likely to return more during the next 1-3 years, and protect you better if markets crash 20%? We’ve crunched the numbers.