Qualcomm Q3 2026 Earnings: Revenue Beat, EPS Miss, and a Double-Digit Chip Price Hike

Qualcomm (QCOM) reported its fiscal third-quarter 2026 earnings on July 29, 2026, delivering a revenue beat but a slight miss on earnings per share. The company also issued weaker-than-expected guidance for the fourth quarter, announced a double-digit chip price increase starting September 1, and revealed that revenue from Apple products is declining faster than previously forecast. Here is a full breakdown of the report and the strategic picture.

Q3 Earnings: Revenue Beat, EPS Slightly Below Estimates

Qualcomm reported fiscal third-quarter 2026 revenue of $9.9 billion, down 4% year-over-year from $10.365 billion, but beating the consensus estimate of roughly $9.67 billion . Non-GAAP (adjusted) earnings per share came in at $2.21, which was slightly below the Wall Street consensus of $2.23 and down 20% from $2.77 a year earlier . GAAP EPS was $1.87, down 23% year-over-year . In short, revenue beat expectations, but EPS narrowly missed.

Q4 Guidance: Weaker Than Expected

Qualcomm issued a fiscal fourth-quarter 2026 outlook that disappointed investors:

• EPS guidance: $2.05–$2.25, versus the consensus estimate of $2.23 .
• Revenue guidance: $9.7 billion–$10.5 billion .

The company blamed the soft profit outlook on rising memory costs and broader semiconductor input inflation that are squeezing margins . The stock fell roughly 8% in after-hours trading on the news .

Chip Price Hike: Double-Digit Increase Starting September 1

Qualcomm notified customers in July that it will raise chip prices by double-digit percentages for products shipped after September 1, 2026 . The reasons given for the price increase:

• Rising supplier costs — Qualcomm said it has "fully exhausted its ability to absorb escalating supplier costs" and could not find sufficient alternative vendors .
• Memory and component shortages — A severe supply crunch for computer parts, especially memory (DRAM/NAND), has pushed up input costs across the supply chain .
• AI infrastructure demand — High demand for AI data center hardware is cannibalizing manufacturing capacity and driving up fab and substrate costs, which are being passed down to Qualcomm .

Apple-Related Revenue: Accelerated Decline

Qualcomm said revenue from Apple products is declining faster than previously forecast . As Apple continues its multi-year transition to in-house modem chips, Qualcomm's Apple modem revenue stream is shrinking more rapidly than earlier projections anticipated .

Offsetting the Apple Revenue Loss

Qualcomm is offsetting the decline in Apple-related revenue by aggressively diversifying into non-handset markets:

• Automotive revenue surged 61% year-over-year to $1.6 billion, making it the fastest-growing segment .
• IoT and other adjacent markets are also contributing to growth, with the company emphasizing "diversification accelerates amid headwinds" .

Handset Chip Revenue Performance

Handset (smartphone) chip revenue was a notable weak spot:

• $5.1 billion in QCT handset revenue, down 20% year-over-year .
• The decline reflects both a sluggish smartphone replacement cycle and the loss of Apple modem business .

Automotive Revenue Performance

Automotive was a standout segment:

• $1.6 billion in revenue, up 61% year-over-year .
• This was the primary driver of growth within Qualcomm's QCT segment.

Outlook on Non-Handset Revenue Growth

Qualcomm is positioning itself as a diversified computing and connectivity company beyond smartphones. On the earnings call, management highlighted "solid execution of growth strategy" and pointed to automotive, IoT, and PC/Windows-on-Snapdragon as key growth vectors . The company's narrative is that non-handset revenue streams — particularly automotive and IoT — will increasingly buffer the cyclical downturns in the smartphone market and the structural loss of Apple modem revenue over time. The stock remains under pressure in the near term due to margin compression from rising memory costs, but the price hike is a direct effort to restore margins starting in Q4 .