Qualcomm predicts that fourth-quarter profits will fall short of Wall Street expectations, and revenue from Apple business is expected to decline at an accelerated pace

Qualcomm predicts that its profits for the fourth fiscal quarter will fall short of Wall Street expectations and stated that revenue from Apple-related businesses will decline faster than anticipated due to supply constraints and rising costs. Qualcomm's stock price fell more than 3% in after-hours trading.

Qualcomm CEO Cristiano Amon stated in a media interview that not only are memory chip costs rising, but costs across the entire supply chain are increasing. He mentioned that Qualcomm plans to raise prices starting September 1 to restore profit margins to historical levels. "We are simply passing on the significant cost increases we are facing," Amon said, noting that Qualcomm must negotiate with each customer. "The temporary disconnect between costs and pricing has led to a slight decline in gross margins." Qualcomm also indicated that due to supply constraints, its component share in the next-generation iPhone will be far below the previously expected 20%, leading to a faster decline in revenue from Apple business starting in the fourth fiscal quarter. For fiscal year 2027, Qualcomm expects that most of its chip sales revenue will come from areas outside of smartphones. "To some extent, we have replaced our Apple business with data center business," Amon stated.

Qualcomm expects adjusted earnings per share for the fourth fiscal quarter to be between $2.05 and $2.25, below the average analyst expectation of $2.36. Qualcomm anticipates fourth fiscal quarter revenue to be between $9.7 billion and $10.5 billion, while analysts expect $10.02 billion. Revenue from its chip business segment is expected to be between $8.4 billion and $9 billion, with analysts expecting $8.49 billion