Qualcomm Stock Falls 5% After Hours: Handset Sales Drop 26% Despite Earnings Beat

Qualcomm beat earnings on Wednesday, November 4, 2026 — and its stock still fell about 5% after hours. The chipmaker reported adjusted earnings of $2.17 a share, just above the $2.16 analysts expected, on adjusted revenue of $10.44 billion that also beat forecasts. Investors sold anyway, focusing on one number: handset chip revenue down 26% from a year earlier to $5.14 billion.

What happened

Qualcomm reported fiscal fourth-quarter results after the close on Wednesday for the quarter ended September 27. Adjusted sales fell 7% to $10.44 billion, beating estimates of about $10.11 billion, according to Reuters. Reported revenue was $10.32 billion, down 8%. The stock had closed the regular session up 5.3% at $173.19, then fell about 4.9% to $164.78 in after-hours trading, Dow Jones via Morningstar reported.

The problem was the core business. Revenue from Qualcomm's handset unit, which makes chips for smartphones, fell 26% to $5.14 billion, below the $5.25 billion analysts polled by Visible Alpha expected. That drop dragged total chip-segment revenue down 8% to $9.02 billion. Global smartphone shipments fell 20% in the September quarter to a 14-year low, according to Counterpoint Research figures cited by Reuters — a brutal backdrop for the world's biggest Android chip supplier.

Why it's blowing up

First, this was a guidance story, not just a quarter story. For the fiscal first quarter, Qualcomm guided revenue to $10.4 billion to $11.2 billion, a midpoint above the $10.48 billion average estimate. But its adjusted profit guide of $2.15 to $2.35 a share has a midpoint of $2.25, below the $2.27 analysts expected. In other words, sales look fine and profits look squeezed.

Second, margins are under pressure. Barron's reported Qualcomm expects its chip segment's operating margin at 20% to 22% in the current quarter, down from 24% in the fourth quarter, and quoted the company citing a broad rise in input costs across wafer fabrication, assembly, test, advanced packaging, memory and other materials. Memory shortages have been a recurring theme this earnings season, pushing up phone component costs and weighing on handset demand.

Third, Apple is leaving the model. Chief Executive Cristiano Amon told Reuters the first-quarter forecast includes no further sales from Apple, as Apple moves away from Qualcomm modems. That removes a large, predictable revenue stream and puts more weight on everything else Qualcomm sells.

The bright spot: autos and data centers

Not everything shrank. Automotive chip revenue jumped 89% to about $2.0 billion, well above the $1.7 billion analysts projected, Barron's reported. Amon said non-handset revenue is expected to replace Apple entirely, with non-handset business growing about 60% year over year in fiscal 2027.

Data centers are the newer bet. Qualcomm expects about $650 million in data-center sales in the fiscal first quarter, above the $539.1 million analysts expected, according to Reuters, with revenue from two custom chip programs with hyperscalers starting this quarter ahead of a larger AI accelerator ramp next year. Qualcomm is targeting $15 billion in annual data-center revenue by fiscal 2029. Morningstar also noted Qualcomm was selected by SpaceX to supply cellular technology as Starlink expands into the wireless market — another example of the diversification investors are being asked to value.

Amon also pushed back on the handset gloom, saying sales of Android handsets had bottomed out and were ticking upward again. One analyst quoted by Reuters, Anshel Sag of Moor Insights & Strategy, summed up the market reaction: handsets being down 26% drags things down a lot given the size of that business, and is likely the major reason the stock fell.

What's next

The next test is whether the non-handset growth arrives fast enough. Auto revenue is already large and growing quickly, data-center revenue is guided above expectations, and Qualcomm's own forecast assumes no Apple contribution — so any handset recovery from here would be on top of a reset base, not dependent on Apple returning. At the same time, the margin warning matters: if memory and other input costs stay high, revenue beats may keep translating into softer profit guides, the exact pattern that hit the stock on Wednesday night. Chip peers had a similarly muted night, with SiliconANGLE noting Arm also slipped after its results. This report describes what happened and why markets reacted; it is not a recommendation to buy, sell or hold any security.

FAQ

Why did Qualcomm stock fall after earnings if it beat estimates?

Because handset chip revenue fell 26% to $5.14 billion and missed estimates, and Qualcomm's profit guidance midpoint came in below forecasts, pointing to squeezed margins despite a revenue and earnings beat for the quarter.

How much did Qualcomm earn in the fiscal fourth quarter?

Qualcomm reported adjusted earnings of $2.17 a share, versus $2.16 expected, on adjusted revenue of $10.44 billion, versus about $10.11 billion expected. Reported revenue was $10.32 billion.

What did Qualcomm guide for the next quarter?

Qualcomm guided fiscal first-quarter revenue to $10.4 billion to $11.2 billion and adjusted earnings to $2.15 to $2.35 a share. It also expects about $650 million in data-center sales, above analyst expectations.

Is Apple still a Qualcomm customer in the forecast?

No. CEO Cristiano Amon said the first-quarter forecast includes no further sales from Apple, and Qualcomm expects growth in automotive, IoT and data centers to replace that revenue over fiscal 2027.

Sources: Reuters, Barron's, Morningstar / Dow Jones, SiliconANGLE.