Qualcomm (QCOM) AI Stock Analysis

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Qualcomm

(NASDAQ:QCOM)

79Outperform

Qualcomm demonstrates a strong financial foundation with notable profitability and growth potential, particularly in the automotive and IoT sectors. The earnings call provided positive guidance, reinforcing confidence in future performance despite some challenges in licensing revenues and global trade uncertainties. Technical analysis suggests a cautious outlook on momentum, while valuation metrics indicate the stock is reasonably priced with a solid dividend yield.

Positive Factors

Financial Performance

Qualcomm's FQ225 results were solid, with outperformance in all segments including Handsets, Auto, and IoT.

Strategic Partnerships

Recently announced extension of Apple partnership to 2026 ensures earnings visibility for the handset segment.

Negative Factors

Macroeconomic Risks

There is current uncertainty around tariffs and macroeconomic conditions, which management acknowledges.

Market Competition

Mediatek, the largest Chinese competitor to Qualcomm, continues to move up market into premium tier devices which could lead to share loss for Qualcomm.

Qualcomm (QCOM) vs. S&P 500 (SPY)

Market Cap

$167.44B

Dividend Yield2.23%

Average Volume (3M)10.65M

Price to Earnings (P/E)15.5

Beta (1Y)1.63

Revenue Growth16.15%

EPS Growth32.28%

CountryUS

Employees49,000

SectorTechnology

Sector Strength80

IndustrySemiconductors

Share Statistics

EPS (TTM)2.85

Shares Outstanding1,098,000,000

10 Day Avg. Volume8,770,536

30 Day Avg. Volume10,650,074

Financial Highlights & Ratios

PEG Ratio2.92

Price to Book (P/B)5.78

Price to Sales (P/S)0.00

P/FCF Ratio13.62

Enterprise Value/Market Cap1.00

Enterprise Value/Revenue1.05

Enterprise Value/Gross Profit7.09

Enterprise Value/Ebitda3.37

Forecast

1Y Price Target

$178.31

Price Target Upside16.92% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering17

Qualcomm Business Overview & Revenue Model

Company DescriptionQualcomm Incorporated (QCOM) is a global leader in the development and commercialization of foundational technologies for the wireless industry. The company is known for its pioneering work in mobile communications and is a key player in the 5G technology space. Qualcomm's core products and services include mobile processors, modems, and other semiconductor components that are essential for smartphones, tablets, and other wireless devices. The company also offers technology licensing and services that enable the global mobile ecosystem to innovate and expand.

How the Company Makes MoneyQualcomm makes money primarily through two business segments: Qualcomm CDMA Technologies (QCT) and Qualcomm Technology Licensing (QTL). The QCT segment generates revenue by designing and supplying integrated circuits and system software based on 3G, 4G, and 5G technologies for use in mobile devices, wireless networks, and consumer electronics. The company's QTL segment earns revenue by licensing its portfolio of patents and intellectual property to mobile device manufacturers, allowing them to build devices that comply with various wireless standards. Significant partnerships with major tech companies and OEMs, as well as its leadership in advancing 5G technology, contribute to Qualcomm's earnings. Additionally, the company's strategic investments in areas like automotive, IoT, and AI provide potential growth opportunities.

Qualcomm Key Performance Indicators (KPIs)

Any

Revenue by Segment

Revenue by Segment
Analyzes revenue from different business segments, highlighting which areas are driving growth and which may need strategic adjustments.

Chart InsightsQualcomm's Equipment and Services revenue shows a strong recovery, reaching near pre-pandemic highs, driven by strategic advancements in automotive and IoT sectors. However, Licensing revenue remains flat, reflecting challenges in handset sales in emerging regions. The earnings call highlights Qualcomm's focus on diversifying beyond handsets, with ambitious targets for automotive and PC revenues by fiscal 2029. Despite global trade uncertainties, Qualcomm's commitment to returning 100% of free cash flow to shareholders underscores confidence in its financial strategy and growth potential in non-handset markets.

Data provided by:

Main Street Data

Qualcomm Financial Statement Overview

Summary

Qualcomm exhibits robust financial health characterized by strong profitability, efficient cash flow management, and a balanced capital structure. The company shows consistent revenue growth and profitability, with efficient leverage and a strong equity base. These metrics highlight Qualcomm's solid position in the semiconductor industry, with well-managed financial operations and growth potential.

Income Statement

Very Positive

Qualcomm demonstrates strong profitability with a gross profit margin of 55.7% and a net profit margin of 26.1% for TTM (Trailing-Twelve-Months). The company shows a robust revenue growth rate of 8.5% from the previous year. EBIT and EBITDA margins are healthy at 27.3% and 31.4%, respectively, indicating efficient operational management. The income statement reflects solid financial performance, driven by consistent revenue growth and strong profitability metrics.

Balance Sheet

Positive

Qualcomm's balance sheet is stable with a debt-to-equity ratio of 0.53, reflecting moderate leverage. The return on equity (ROE) for TTM is 39.8%, indicating effective use of equity to generate profits. The equity ratio stands at 50.1%, suggesting a balanced asset financing structure. Despite moderate debt levels, the company's strong equity position and high ROE underscore its financial health.

Cash Flow

Very Positive

The cash flow analysis reveals a positive trajectory with a free cash flow growth rate of 4.9%. The operating cash flow to net income ratio is 1.16, and the free cash flow to net income ratio is 1.06, indicating strong cash generation relative to earnings. Qualcomm's ability to generate cash efficiently supports its financial stability and growth prospects.

TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Breakdown
Income Statement		Total Revenue
42.28B	38.96B	35.82B	44.20B	33.57B	23.53B
	Gross Profit
23.55B	21.90B	19.95B	25.57B	19.30B	14.28B
	EBIT
11.55B	10.07B	7.79B	15.86B	9.79B	6.25B
	EBITDA
13.28B	12.74B	10.46B	16.56B	11.37B	7.62B
	Net Income Common Stockholders
11.04B	10.14B	7.23B	12.94B	9.04B	5.20B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
13.85B	13.30B	11.32B	6.38B	12.41B	11.21B
	Total Assets
55.37B	55.15B	51.04B	49.01B	41.24B	35.59B
	Total Debt
14.62B	14.63B	15.40B	15.48B	15.74B	15.73B
	Net Debt
7.42B	6.79B	6.95B	12.71B	8.63B	9.02B
	Total Liabilities
27.64B	28.88B	29.46B	31.00B	31.29B	29.52B
	Stockholders Equity
27.73B	26.27B	21.58B	18.01B	9.95B	6.08B
Cash Flow		Free Cash Flow
11.71B	11.16B	9.85B	6.83B	8.65B	4.41B
	Operating Cash Flow
12.84B	12.20B	11.30B	9.10B	10.54B	5.81B
	Investing Cash Flow
-3.39B	-3.62B	762.00M	-5.80B	-3.36B	-5.26B
	Financing Cash Flow
-11.44B	-9.27B	-6.66B	-7.20B	-6.80B	-5.71B

Qualcomm Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price152.50

Price Trends

50DMA

147.22

Positive

100DMA

155.32

Negative

200DMA

159.68

Negative

Market Momentum

MACD

1.79

Negative

RSI

58.77

Neutral

STOCH

90.18

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For QCOM, the sentiment is Neutral. The current price of 152.5 is above the 20-day moving average (MA) of 145.23, above the 50-day MA of 147.22, and below the 200-day MA of 159.68, indicating a neutral trend. The MACD of 1.79 indicates Negative momentum. The RSI at 58.77 is Neutral, neither overbought nor oversold. The STOCH value of 90.18 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for QCOM.

Qualcomm Risk Analysis

Qualcomm disclosed 24 risk factors in its most recent earnings report. Qualcomm reported the most risks in the “Tech & Innovation” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Qualcomm Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AMD	82 Outperform	$190.87B	84.29	3.90%	―	21.71%	99.00%
QCOM	79 Outperform	$167.44B	15.54	42.21%	2.23%	16.15%	32.28%
NXPI	73 Outperform	$53.39B	22.79	26.02%	1.92%	-7.21%	-15.29%
ADI	71 Outperform	$112.50B	72.33	4.43%	1.65%	-19.28%	-44.00%
TXN	70 Outperform	$171.25B	35.59	29.04%	2.86%	-4.48%	-17.82%
Sector *	60 Neutral	$11.62B	10.48	-7.27%	2.93%	7.46%	-10.64%
INTC	48 Neutral	$93.87B	―	-18.66%	2.32%	-3.97%	-562.40%

* Technology Sector Average

Performance Comparison

QCOM

Qualcomm

152.50

-41.38

-21.34%

AMD

Advanced Micro Devices, Inc.

117.17

-49.16

-29.56%

ADI

Analog Devices

227.11

13.18

6.16%

INTC

Intel

21.66

-10.24

-32.10%

NXPI

NXP Semiconductors

212.56

-56.28

-20.93%

TXN

Texas Instruments

188.50

-5.02

-2.59%

Qualcomm Earnings Call Summary

Earnings Call Date:Apr 30, 2025

(Q2-2025)

% Change Since: 2.72%|

Next Earnings Date:Jul 30, 2025

Earnings Call Sentiment Positive

Qualcomm's earnings call reflected strong financial performance and strategic advancements, particularly in automotive and IoT sectors, despite facing uncertainties in the global trade environment and challenges in licensing revenue growth.

Q2-2025 Updates

Positive Updates

Strong Revenue and EPS Growth

Qualcomm reported non-GAAP revenues of $10.8 billion and non-GAAP EPS of $2.85, both exceeding guidance midpoint. This marks 17% revenue growth and 21% EPS growth year-over-year.

Automotive and IoT Revenue Surge

Automotive revenues increased by 59% and IoT revenues grew by 27% year-over-year, driven by demand for connectivity, processing, and AI technologies.

Expansion in Mobile AI

Qualcomm announced the X85 5G platform, an advanced AI-powered modem system. This platform will exclusively ship in Android devices, marking significant traction in the mobile AI space.

Significant Automotive Design Wins

Qualcomm secured 30 new automotive design wins, including five ADAS programs, indicating strong market penetration and future growth potential.

Increased Capital Return to Shareholders

Qualcomm increased its capital return target to 100% of free cash flow in fiscal 2025, reflecting confidence in its financial targets and strong cash flow generation.

Negative Updates

Flat Licensing Revenue

Licensing business revenues were flat at $1.3 billion, with no significant growth year-over-year, and were slightly below the guidance midpoint.

Tariff and Trade Environment Uncertainty

Qualcomm noted the dynamic nature of the global trade landscape, including tariffs, which could impact demand and financial results unpredictably.

Lower Handset Units in Emerging Regions

QTL revenues were slightly below the midpoint of guidance due to lower handset units in emerging regions, affecting overall segment performance.

Company Guidance

In the Qualcomm Second Quarter Fiscal 2025 Earnings Conference Call, the company reported non-GAAP revenues of $10.8 billion and non-GAAP earnings per share of $2.85, surpassing the midpoint of their guidance. The chipset business achieved revenues of $9.5 billion, with significant growth in Automotive and IoT, which saw year-over-year increases of 59% and 27%, respectively. Licensing business revenues were $1.3 billion. Qualcomm aims to grow its non-handset revenues to $22 billion by fiscal 2029 and highlighted the potential of generative AI models in expanding their market capabilities. The company announced its X85 5G platform, supporting ultrafast peak download speeds of up to 12.5 Gbps and anticipated to ship in the second half of the year. Additionally, Qualcomm aims to achieve $4 billion in PC revenues and $2 billion in XR revenues by fiscal 2029, with a strong focus on automotive growth, targeting $8 billion by the same fiscal year. For the upcoming quarter, Qualcomm forecasts revenues between $9.9 billion and $10.7 billion, with a targeted non-GAAP EPS of $2.60 to $2.80. The company plans to return 100% of fiscal 2025 free cash flow to stockholders, underlining its confidence in cash flow generation and long-term financial strategies.

Qualcomm Corporate Events

Executive/Board Changes

Qualcomm Appoints Christopher Young to Board of Directors

Neutral

May 13, 2025

On May 12, 2025, Qualcomm‘s Board of Directors elected Christopher D. Young, a former executive from Microsoft, to join the Board. Young will serve until the next annual stockholders’ meeting and will be part of the HR and Compensation Committee. His appointment involves no special arrangements or transactions with the company, and he will receive compensation under Qualcomm’s 2025 Director Compensation Plan, including 1,748 deferred stock units for his service.

The most recent analyst rating on (QCOM) stock is a Hold with a $170.00 price target. To see the full list of analyst forecasts on Qualcomm stock, see the QCOM Stock Forecast page.

Spark’s Take on QCOM Stock

According to Spark, TipRanks’ AI Analyst, QCOM is a Outperform.

To see Spark’s full report on QCOM stock, click here.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.