Key Points
- QCOM will report third-quarter earnings on July 30, with earnings per share and revenue estimated at $2.68 and $10.36B.
- The company launched the Snapdragon 7 Gen 4 and expanded AI capabilities with several acquisitions.
- As the fierce competition among low-cost chip manufacturers, the guaranteed pressure on mid-range smartphones continues.
Qualcomm Incorporated (QCOM Quick QuotationQCOM – Free Report) plans to report third-quarter fiscal revenue on July 30, 2025. Zacks consensus estimates revenue and revenue of $10.36 billion and $2.68 per share, respectively. Over the past 60 days, QCOM's earnings estimates fell by 0.26% in fiscal 2025 and 1.99% in fiscal 2026.
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Income surprise history
CHIP manufacturers provide an average of three-quarters of revenue surprises, on average per estimate. In the last quarter, the company's revenue surprise was 0.71%.
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Income whispers
Our tried and tested models predict that Qualcomm's possible revenue could be successful in fiscal year 3. The combination of positive income ESP and Zacks ranked first (forced buy), 2 (buy) or 3 (hold) increases the chances of income beats. The situation here is perfect. You can find the best buying and selling stocks before reporting our earnings ESP filters.
Qualcomm currently has an ESP of +0.60%, and Zacks ranked #3. You can see the full list of today's Zacks #1 ranking stocks here.
Factors that shape the upcoming results
During the quarter, Qualcomm launched the cutting-edge Snapdragon 7 Gen 4 mobile platform. This solution features cutting-edge CPU and GPU capabilities that significantly improve AI performance, enhanced gaming, content generation and connectivity capabilities. The newly launched solutions have gained solid market traction. Leading OEMs such as Honor and Vivo have already chosen the Snapdragon 7 Gen 4 mobile platform for upcoming devices. New platforms are also expected to be adopted in the field.
During the quarter of the review, E&A Global Technology Group chose Qualcomm to strengthen digital infrastructure across the UAE. Under the 2030 vision, Saudi Arabia is investing heavily in advanced AI and 5G technologies to drive digital transformation across the country. Qualcomm positioned itself as a key player in the program. QCOM has teamed up with Humain to develop AI data centers to provide hybrid AI services from the cloud to the edge. It has established a partnership with Aramco Digital to support the development of advanced AI industrial IoT devices and end-to-end solutions.
In the third quarter, the company acquired Automated Pass to enhance its vehicle-to-Service (V2X) technology for safer and smarter transportation systems. Qualcomm also acquired Movianai, the former biological AI unit of Vinai, a famous Vietnamese AI company. The acquisition will give Qualcomm acquiring Vinai's comprehensive expertise in generating AI, machine learning, computer vision and natural language processing.
It also signed a confirmed agreement to acquire Alphawave Semi for a corporate value of approximately $2.4 billion. Alphawave Semi Semi Semi Semi Semi and Chiplet have complementary and efficient technology solutions that provide faster, more reliable data transmission and lower power consumption for 5G wireless, AI and data center applications. These acquisitions will greatly enhance Qualcomm's AI capabilities.
Price performance
Qualcomm lost 10.3% over the past year, while the industry grew 41%, and its peers lagged behind Broadcom Inc. (avgo fast quoteavgo – Free Report), but outperforms Intel Corporation (INTC Quick QuotationINTC – Free Report). During this period, Broadcom rose 93.8%, while Intel has fallen 32.2%.
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Key Valuation Indicators
From a valuation perspective, Qualcomm seems to be relatively cheap compared to the industry, below its average. By price/income ratio, the company's current stock is currently 13.44 forward earnings, which is below the industry's 34.13, with the stock's average of 16.97.
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Investment considerations
Qualcomm's goal is to become the driving force for the next wave of AI innovation. Its recent strategic acquisitions and innovation plans are exactly in line with the strategy. The acquisition will provide Qualcomm with access to next-generation technologies, strengthen its R&D programs, and promote the development of state-of-the-art AI-driven solutions for a variety of industries, including smartphones, PCs, software-defined vehicles, and more.
The company is witnessing the healthy traction of the premium mobile phone market first-hand. But strengthening competition from low-cost chip makers such as Mediatek and Rockchip is affecting profits in the mid-range smartphone market. The company has been taking action to address these issues. It is introducing several cutting-edge AI capabilities into mid-range smartphone chips and has been actively working with major smartphone manufacturers to develop solutions that meet their needs. Qualcomm is also expanding its portfolio products to increase the resilience of its business model. The company is expected to benefit from strong demand for its Snapdragon digital chassis platform in the automotive market. These factors may promote business prospects.
However, despite some setbacks, Intel is still a major player in chipset development. The company's growing capabilities in the AI PC vertical industry may pose a challenge to Qualcomm's AI PC expansion. The company also faces competition from Broadcom, an outstanding supplier of RF components for leading smartphone manufacturers.
Ending
With Zacks ranking 3, QCOM appears to be stomping in the middle of the road, and they would be better if new investors trade with caution. Strengthening competition in smartphone verticals is putting pressure on profitability. The decline in revenue estimates highlights bearish sentiment.
However, a quarterly result is not important for long-term stakeholders. Investors who already own the stock may consider sticking with it. Qualcomm is strengthening its AI initiatives to diversify its portfolio to take advantage of emerging trends in multiple end markets. High-end smartphones, advanced driver help, V2X communications, AI PCs and IoT spaces are getting higher and higher traction. Strategic acquisitions are strengthening the portfolio. Such development is sufficient for long-term sustainable growth.