Guidance: Q1 FY26

Qualcomm’s fiscal fourth quarter offered a blend of robust execution, expanding end-market opportunity, and a clear roadmap for AI at the edge. Despite headline noise from a tax-related GAAP loss, management’s tone on the call was unmistakably confident. Below are the three biggest takeaways from Qualcomm’s Q4 2025 earnings call with CEO Cristiano Amon and CFO Akash Palkhiwala.

Qualcomm’s AI Strategy Now Extends Beyond the Edge — and Into the Data Center

Amon spent a significant portion of the call outlining Qualcomm’s entry into AI inference hardware for data centers, calling it the company’s “next chapter” of diversification. The company unveiled its AI 200 and AI 250 SoCs along with accelerator cards and racks, targeting hyperscaler deployments starting in 2026.

Amon described Qualcomm’s “right to win” as centered on power efficiency and compute density, with the goal of maximizing tokens per watt — a clear jab at Nvidia’s high-power training architectures. The first customer for these chips is Humen (formerly Hugh Main) with a 200MW deployment slated for 2026.

“We believe the next phase of AI buildout will demand competition and power efficiency,” Amon said. “Our architecture is designed for high-density inference with significantly lower energy draw.”

An update on roadmap details and hyperscaler partnerships is expected in 1H 2026.

The AI PC and Edge Ecosystem Are Accelerating Faster Than Expected

Qualcomm doubled down on its PC ambitions. Amon highlighted the Snapdragon X2 Elite and X2 Elite Extreme, the company’s newest laptop platforms, which he claims outperform both Intel and AMD in speed and power efficiency.

The company now expects ~150 design wins to be commercialized through 2026, underscoring growing OEM adoption. The launch cadence reflects Qualcomm’s pivot to an AI-first computing ecosystem spanning PCs, wearables, XR, and industrial IoT.

“AI is transforming how humans interact with devices,” Amon said. “Smart glasses and wearables are evolving into personal AI devices that connect users directly to AI agents.”

Notably, Meta, Samsung, and Google featured prominently as partners:

• Meta launched multiple Snapdragon-powered AI eyewear, including the Ray-Ban Meta 2 and Oakley Meta Vanguard.

• Samsung unveiled its Galaxy XR headset, powered by Android XR, marking the first AI-native OS integration for extended reality.

Together, these moves cement Qualcomm’s position as a key enabler of AI at the edge, while its brand momentum continues — Snapdragon entered Interbrand’s Top 100 and Kantar’s Most Valuable Brands lists for the first time.

Automotive and IoT Momentum Are Hitting Escape Velocity

CFO Akash Palkhiwala reiterated that Qualcomm remains on track to hit its $22B Automotive + IoT revenue target by FY2029, with FY2025 growth of 36% and 22%, respectively. Automotive revenues surpassed $1B in a single quarter for the first time — a major milestone.

The highlight was the debut of Snapdragon Ride Pilot, Qualcomm’s Level 2+ autonomous driving system, developed with BMW. Ride Pilot enables hands-free highway driving and urban navigation, and is now validated in 60 countries, expanding to 100 by 2026.

On the IoT front, the recently completed Arduino acquisition gives Qualcomm access to 30 million developers and strengthens its foothold in industrial edge AI. Combined with prior purchases like Edge Impulse and Foundries.io, Qualcomm is building a full-stack AI development ecosystem spanning silicon, software, and developer community reach.

“We’re expanding our portfolio across industrial automation, robotics, drones, and connected devices,” Amon said. “AI is now becoming pervasive across every vertical we touch.”

The Good:

• Non-GAAP execution remains excellent, QCT margin at 30%, record Automotive/IoT growth.
• Guidance signals strong visibility into FY26 earnings.

The Caution:

• The GAAP loss headline may spook retail holders despite being non-cash.
• Handsets, though up 14%, still tether the narrative to smartphone cyclicality.

Qualcomm’s fundamentals are clean beneath the tax noise. With core EPS of $12.03 (+18% YoY) and a forward multiple around 14x, the post-earnings pullback looks more technical than structural. Watch for recovery as investors recalibrate around the true operating picture.

Qualcomm just posted its strongest underlying year ever for its chip division ,yet optics from a one-time tax charge dragged GAAP results into the red. Beneath the noise, this was an earnings beat and a reaffirmation of its AI-driven diversification story.

QCT (Chip Division)

• Record $9.82B in quarterly sales, +13% YoY, driven by handset rebound and Automotive +17%.

• IoT revenue rose 7% YoY to $1.81B.

• Full-year QCT revenue hit $38.4B, up 16% YoY.

QTL (Licensing)

• Revenue fell 7% YoY to $1.41B, reflecting royalty mix normalization post-Android rebound.

• Licensing margins still robust at 72%.

Automotive and IoT Momentum

• Automotive up 36% YoY for the year to $3.96B, driven by Snapdragon Digital Chassis adoption with BMW and Xiaomi.

• IoT grew 22% YoY, led by industrial automation and connected device deployments

Qualcomm topped consensus on both the top and bottom line, delivering 10% YoY revenue growth and a 12% rise in non-GAAP EPS. However, GAAP results were distorted by a $5.7B non-cash tax charge tied to the new One Big Beautiful Bill Act, which forced a valuation allowance on deferred tax assets

“We delivered 18% year-over-year growth in total QCT non-Apple revenues, with combined fiscal year Automotive and IoT revenue growth of 27%.” – Cristiano Amon

“Our business remains strong as demonstrated by record QCT revenues in fiscal 2025.” – Cristiano Amon

Numbers are in and shares down 1.5%

Revenue was $11.27 billion, below the $43.54 billion consensus estimate. Non-GAAP EPS was $3.00, above the $11.90 consensus estimate.

Qualcomm reported a 10% increase in revenue year-over-year for Q4 2025, reaching $11.27 billion, driven by strong performance in its QCT segment, which saw a 13% increase in revenues. The company also reported a significant 27% year-over-year growth in combined Automotive and IoT revenues.

However, GAAP results were impacted by a $5.7 billion non-cash charge due to new U.S. tax legislation, resulting in a net loss of $3.12 billion. Qualcomm’s CEO expressed optimism about the company’s momentum, particularly in the automotive and data center sectors. The company returned $3.4 billion to shareholders through dividends and stock repurchases during the quarter.

Qualcomm will finish the day up well over 4% heading into earnings. Pretty strong finish for semi stocks today. The VanEck Semiconductor ETF will close around 2.12% today.

Prediction market Polymarket has a market set up for Qualcomm markets, and the current estimate is there’s a 94% chance QCOM will beat earnings.

Many of the largest tech companies have had high odds of beating earnings this season. That hasn’t always led to beating earnings, however, as Meta missed earnings due to one-time expenses while betting markets gave the company better than 90% odds of topping Wall Street’s expectations.