Should You Sell Your Qualcomm Stock Now?

For questions about this article or underlying research, email help@trefis.com.

Qualcomm (QCOM) stock fell 11.1% on October 30, 2026, trailing a 1.8% decline for an S&P 500 exchange-traded fund. Holders are left with shares priced at 18.8 times earnings, below the 22.6 multiple for the S&P 500. Management said the company’s phone chip business is losing revenue to unprecedented memory prices. Qualcomm is building car and data center chips to fill the gap. So how far have Qualcomm’s results slipped?

Qualcomm’s Sales And Margin Fell In Fiscal Q3 2026

Revenue fell 4.0% from a year earlier in the quarter that ended June 28, marking Qualcomm’s second consecutive quarter of lower sales. Profit declined faster than sales: the operating margin dropped to 16.3% in that quarter from 26.6% a year earlier.

Qualcomm’s P/E is measured on the twelve months to June, when its operating margin was 23.3% compared with 18.7% for the S&P 500. The lower P/E is therefore based on a year when Qualcomm was more profitable than the market, and the latest quarter’s margin fell short of that year’s.

On the July 29 call, management said unprecedented memory prices and higher manufacturing costs were hurting the whole industry. Management added that Qualcomm’s chip gross margins would sit slightly below their usual range in the short term.

Can Qualcomm’s Car Chips Make Up For Phones?

Not yet. In fiscal Q3 2026, Qualcomm’s chips for cars and connected devices brought in $3.4 billion, trailing the $5.1 billion from phone chips. Car chips accounted for $1.6 billion of that $3.4 billion. Car chip sales rose 61% from a year earlier, compared with 9% for connected-device chips.

The phone business is also losing part of its Apple revenue. In July, management said Qualcomm’s share of the next iPhone launch would be materially lower than its earlier estimate of 20%. Management said the step-down in Apple revenue would speed up from the fourth fiscal quarter.

The data center business comes later. Qualcomm has two custom chip deals with large cloud computing companies, and management said the company will start booking revenue from both in the December quarter. In September the company also announced a collaboration with Amazon across multiple generations of custom chips for Amazon’s AI data centers.

The businesses Qualcomm is building are growing, but for now they remain smaller than its phone chips, and the Apple revenue is leaving sooner than management had expected.

Qualcomm Is Raising Prices To Cover Higher Costs

Management said on the July 29 call that Qualcomm is raising prices across its markets by a double-digit percentage, passing on higher costs in line with other chipmakers. The company expected the benefit to show up gradually in gross margins over the couple of quarters after that call, because some existing contracts and product cycles have to run their course first.

For fiscal Q4 2026, management guided revenue of $9.7 billion to $10.5 billion, compared with $9.95 billion in fiscal Q3 2026. Qualcomm’s gross margin is the number to watch when the company reports in November 2026, after dropping to 53.1% in fiscal Q3 2026 from 55.6% a year earlier. Management said its price increases would lift that margin gradually, so the November figure will be a first read on whether that benefit is arriving.

What Would Another Fall In Qualcomm Do To Your Plan?

A fall hurts most when one stock is a large part of what you own, and selling it to spread the risk can bring a large tax bill. Our partner advisory firm offers a free strategy review of ways to put a floor under a large position and unwind it with less tax.

Request A Free Strategy Review

Spot an error or want more like this? Tell us in 10 seconds.