Qualcomm's Auto Chip Revenue Jumps 89% as Handset Sales Fall 26%

Qualcomm's latest earnings show how quickly its chip business is changing—and how much weight smartphones still carry. In the fiscal fourth quarter reported on November 4, 2026, automotive chip revenue grew 89% year over year. Handset chip revenue fell 26%. The growing vehicle business remains substantially smaller than the mobile business it is helping diversify.

Cars are growing fast, but the phone decline is bigger in dollars

For the fiscal quarter ended September 27, 2026, Qualcomm reported $1.990 billion of revenue from its QCT Automotive stream, up from $1.053 billion in the year-earlier period. Its QCT Handsets stream fell from $6.961 billion to $5.137 billion. The QCT Internet of Things stream rose 4% to $1.888 billion.

That means automotive added about $937 million in year-over-year quarterly sales, while handsets lost about $1.824 billion, calculated from Qualcomm's disclosed figures. The automotive gain covered only about half the handset decline. Total QCT revenue dropped 8% to $9.015 billion, despite record quarterly automotive sales. These are segment revenue figures, not profit contributions.

Qualcomm's companywide GAAP revenue declined 8% to $10.322 billion in the quarter. GAAP net income was $1.251 billion, or $1.17 per diluted share. The company separately reported non-GAAP EPS of $2.17, down from $3.00 in the year-earlier quarter. Those accounting bases should not be treated as interchangeable.

Data centers are the next major diversification test

Alongside the results, Qualcomm highlighted a multigenerational product collaboration with Amazon for AI data centers and reiterated its fiscal 2027 data-center revenue target of $5 billion. Management also projected non-handset revenue growth of more than 60% in fiscal 2027. Both figures are forward-looking goals, not revenue already booked in the fourth quarter.

The company's first-quarter fiscal 2027 outlook calls for total revenue of $10.4 billion to $11.2 billion and non-GAAP diluted EPS of $2.15 to $2.35. Its corresponding GAAP EPS guidance is $1.03 to $1.23. Qualcomm says the first-quarter QCT revenue guidance includes the data-center business.

Higher chip input costs add another risk

Qualcomm warned of rising industry input costs, including wafer fabrication, packaging, testing and memory. It said it is adjusting product prices, but expects the full benefit of those pricing actions for QCT gross margins only in the second half of fiscal 2027. For the reported fourth quarter, QCT earnings-before-tax margin was 24%, versus 29% a year earlier—another reason revenue diversification alone does not settle the profitability question.

One additional accounting distinction matters when comparing full-year performance: Qualcomm's fiscal 2026 GAAP net income benefited from a roughly $5.7 billion release of a tax valuation allowance. The company's full-year non-GAAP diluted EPS fell 12%, from $12.03 to $10.54, even as reported GAAP EPS rose.

What this means for an S&P 500 investor

Qualcomm is an S&P 500 constituent. Its results illustrate a concrete shift within a large U.S. semiconductor business: rapid expansion in automotive and anticipated data-center sales is occurring while its established handset stream contracts. The uncertainty is whether newer activities can offset lost smartphone revenue and deliver attractive margins as component costs rise. The earnings release supplies targets and historical results, not proof that the transition will succeed or a prediction of QCOM's next share-price move.

Source and timing: Qualcomm's November 4, 2026 earnings release (PDF) and its official earnings announcement. Fiscal Q4 2026 ended September 27, 2026. Calculated dollar changes use the company's published quarterly revenue table; projected fiscal 2027 figures are company guidance or targets. No intraday or post-earnings share price is asserted.

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