Qualcomm Warns Apple Revenue Drop Will Accelerate
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- Qualcomm forecast Q4 adjusted profit of $2.05–$2.25 per share, below Wall Street's $2.36 estimate, with revenue guidance of $9.7B–$10.5B versus the $10.02B analysts expected.
- Apple revenue will decline more quickly starting in Q4, as supply constraints cut Qualcomm's share of components in the next iPhone launch to "well below" its earlier 20% estimate, CEO Cristiano Amon told Reuters.
- Qualcomm plans to raise prices starting September 1 to restore historical margins; Amon said costs rose across the supply chain, not just in memory chips, calling the current gap between cost and pricing "temporary."
- Qualcomm's handset chip revenue fell 20% to $5.09 billion in Q3, dragging the chip segment down 5% to $8.50 billion, while total Q3 revenue dropped 4% to $9.95 billion—beating the $9.67B estimate but with adjusted profit of $2.21 missing the $2.23 consensus.
- Qualcomm is targeting $5 billion in AI data-center revenue by fiscal 2027 and $15 billion by 2029, with Amon stating that for fiscal 2027 "the majority of our chip sales will come from categories other than smartphones."
- Seaport analyst Jay Goldberg said the results show Qualcomm "has lost focus on its core mobile market," citing share losses in Android and "almost all remaining share at Apple."
- Qualcomm shares fell more than 3% in extended trading and are up just 1.14% year-to-date, trailing Nvidia (+11.46%) and AMD (+161.79%), with Xiaomi, Oppo and Vivo posting the steepest Q2 shipment declines among the top five global smartphone vendors.
Why it matters: Qualcomm is signaling that its iPhone chip business is shrinking structurally—Apple's silicon ramp plus supply-chain bottlenecks now cut Qualcomm's iPhone component share well below 20%, forcing a September 1 price hike to defend margins. The company's explicit pivot—Amon's "we kind of replaced Apple with the data center" line—puts a $5B fiscal-2027 AI data-center target directly in investors' crosshairs as the offset to accelerating mobile share loss.
