Key Stats
- Current Price: ~$180 (April 30, 2026 close)
- Q2 FY2026 Revenue: $10.6B | YoY: -3.5%
- Q2 FY2026 Non-GAAP EPS: $2.65 | YoY: -7.0%
- Q2 QCT Automotive Revenue: $1.3B | YoY: +38%
- Q2 QCT IoT Revenue: $1.7B | YoY: +9%
- Q3 FY2026 Revenue Guidance: $9.2B to $10.0B
- Q3 FY2026 Non-GAAP EPS Guidance: $2.10 to $2.30
- TIKR Model Price Target: $221
- Implied Upside: ~23%
Qualcomm Stock Q2 FY2026 Earnings Breakdown
Qualcomm stock (QCOM) reported fiscal Q2 revenue of $10.6B and non-GAAP EPS of $2.65, with EPS landing at the high end of guidance despite a year-over-year revenue decline of 3.5%.
The headline drag came from the handset segment, where QCT handset revenues of $6B were held back not by weakening end demand but by cautious OEM build plans tied to tightening memory supply.
According to CFO Akash Palkhiwala on the Q2 fiscal 2026 earnings call, Chinese handset OEMs reduced build plans and drew down channel inventory in response to memory price pressure, causing QCOM to “materially undership consumer demand” throughout the quarter.
The automotive segment delivered the quarter’s defining result, with QCT Automotive revenues of $1.3B representing 38% year-over-year growth and crossing the $5B annualized revenue threshold for the first time.
According to CEO Cristiano Amon on the Q2 fiscal 2026 earnings call, Qualcomm expects to exit fiscal 2026 at an automotive annualized run rate above $6B, driven by fourth-generation Snapdragon Digital Chassis adoption and increasing ADAS content per vehicle.
QCT IoT revenues of $1.7B grew 9% year over year, supported by both industrial and consumer product demand, while QTL revenues of $1.4B came in at the high end of guidance with a 72% EBT margin.
Looking ahead, Qualcomm guided Q3 FY2026 revenue of $9.2B to $10.0B and non-GAAP EPS of $2.10 to $2.30, with handset revenues expected to hit a bottom at approximately $4.9B in the June quarter before returning to sequential growth.
On the capital return side, the company returned $3.7B to shareholders during the quarter, including $2.8B in share repurchases and $945M in dividends, according to Akash Palkhiwala on the Q2 fiscal 2026 earnings call.
Qualcomm also disclosed an expected initial custom silicon shipment to a leading hyperscaler in the December quarter, marking the company’s first concrete revenue milestone in its data center push.
Qualcomm Stock: What the Income Statement Shows
The quarterly income statement tells a margin compression story driven by a sequential revenue step-down and rising operating cost intensity.
Revenue peaked at $12.25B in the December 2025 quarter before pulling back to $10.6B in March 2026, a 13.5% sequential decline that compressed the full margin stack.
Gross margin deteriorated from 54.6% in December 2025 to 53.8% in March 2026, continuing a trend that saw gross margin peak at 56.4% in the September 2024 quarter.
Operating income fell to $2.31B in the March 2026 quarter, down 26% year over year from $3.12B in the year-ago March 2025 quarter, and well below the $3.37B delivered just one quarter earlier.
Operating margin contracted to 21.8% in March 2026 from 28.4% in the prior-year quarter, the lowest reading across the eight quarters shown in the income statement screenshot.
According to Akash Palkhiwala on the Q2 fiscal 2026 earnings call, QCT EBT margin held at 27% for the quarter, consistent with the prior-year period, suggesting that the operating margin compression reflected the company-level cost base rather than segment-level deterioration in chip economics.
What Does the Valuation Model Say?
TIKR’s model prices Qualcomm stock at $221 per share against a current price of approximately $180, implying roughly 23% upside to fair value.
The mid-case model assumes a revenue CAGR of 4.6% and a net income margin of 24.4% through fiscal 2030, a conservative anchor that does not embed significant data center or custom silicon optionality.
The Q2 report does not improve the near-term revenue trajectory, but the automotive and data center milestones disclosed on the call add credibility to the longer-term diversification thesis the model is built around.
With QCOM trading at a discount to model fair value and the forward earnings setup under pressure from memory-driven handset headwinds, the investment case is roughly unchanged on fundamentals but has incrementally more strategic support than before.
The real question Qualcomm stock poses after this report: can automotive and data center scale fast enough to offset handset weakness before the memory cycle drag on earnings becomes a multi-year story?
Near-Term Case
- QCT Automotive revenues grew 38% year over year to $1.3B in Q2 and are guided for approximately 50% year-over-year growth in Q3, according to Akash Palkhiwala on the Q2 fiscal 2026 earnings call
- The fifth-generation Snapdragon Digital Chassis platform, shipping commercially by year-end, represents the largest generation-to-generation content increase in company history per Cristiano Amon on the Q2 fiscal 2026 earnings call
- Management called the China handset inventory drawdown bottom as Q3, with sequential revenue growth expected in Q4
- Capital return acceleration, including $3.7B returned in Q2 alone, provides near-term support for Qualcomm stock even in a soft revenue environment
Long-Term Case
- Custom silicon shipments to a leading hyperscaler are expected in the December quarter, with management describing the engagement as a multi-generation relationship
- The TIKR high-case model projects $310 per share by fiscal 2030, implying 73% total return, contingent on revenue CAGR of 5.1% and net income margin of 25.6%
- Data center CPU, inference accelerator, and custom ASIC pipelines are pre-revenue but represent addressable markets where Qualcomm stock carries zero assigned value today
- 6G infrastructure and network edge AI represent multi-year catalysts with a targeted commercial launch in 2029 per CEO commentary on the call
Should You Invest in QUALCOMM Incorporated?
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