Qualcomm slides ~7% after hours on soft Q1 guidance as chip costs squeeze margins; handset revenue falls 26%
What happened
Qualcomm reported fiscal Q4 results after Wednesday's close that slightly beat Wall Street on the quarter but paired it with a soft outlook, sending shares down roughly 7% in extended trading. Adjusted EPS came in at $2.17 on adjusted revenue of $10.44 billion, versus a $2.16 consensus and roughly $10.1-10.5 billion expected. For the December quarter, Qualcomm guided adjusted EPS to $2.15-$2.35 (midpoint $2.25, below the $2.27 consensus) on revenue of $10.4-$11.2 billion. The company warned its chip-design segment operating margin will fall to 20-22% from 24% in Q4, citing broad-based increases in input costs across wafer fabrication, assembly, test, advanced packaging and memory. Handset chip revenue fell 26% year over year to $5.14 billion, below the $5.21 billion estimate, while automotive revenue soared 89% to $1.99 billion, well ahead of the $1.66 billion estimate. CEO Cristiano Amon framed it as a supply problem, not a demand one: "We don't have a demand issue; it's a supply issue." Qualcomm also reiterated its target of $5 billion in data-center revenue in fiscal 2027, up from about $650 million this quarter.
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Who’s affected
- Qualcomm (QCOM) — directly hit, down ~7% after hours, erasing a 5.3% regular-session gain. Arm (ARM) — fell ~5% after hours on its own report, compounding the chip-sector drag. Semiconductor sector broadly (Philadelphia Semiconductor Index) — Qualcomm and Arm's weak guides dragged Asian chip stocks sharply lower overnight and pushed Nasdaq futures down over 1%. Apple (AAPL) — indirectly exposed, as Qualcomm cited Apple's moves as a factor in the 26% handset revenue decline. Memory suppliers (Micron, SanDisk) — the cost-pressure theme reinforces the memory-squeeze narrative hitting the whole supply chain.