Qualcomm (QCOM) Stock Jumps 13% After Earnings as Data-Center Push Gains Ground

TLDR

• Qualcomm stock jumped 13% in after-hours trading following its fiscal Q2 report
• Adjusted EPS came in at $2.65 on revenue of $10.6 billion, beating analyst estimates
• CEO Cristiano Amon confirmed custom data-center chip shipments expected to begin in December quarter with a major cloud provider
• Automotive revenue hit a record $1.3 billion, up 38% year-over-year, surpassing $5 billion annualized
• Chinese handset revenue expected to hit a low this quarter before returning to growth

Qualcomm’s fiscal second-quarter results dropped Wednesday, and the market liked what it heard. The stock jumped 13% in after-hours trading — not just because of the numbers, but because of what’s coming next.

QUALCOMM Incorporated, QCOM

Adjusted earnings per share landed at $2.65 on revenue of $10.6 billion. Analysts had penciled in $2.56 EPS on $10.59 billion in revenue, so Qualcomm cleared the bar.

The initial reaction was actually muted. Then CEO Cristiano Amon started talking.

Amon told analysts that Qualcomm expects to begin shipping a custom data-center chip to a hyperscaler — a large cloud-computing company — in the December quarter. That was the line that moved the stock.

Data centers have become the hottest real estate in tech, and Qualcomm’s entry into that space is something investors have been watching closely. This was the first concrete timeline they’ve been given.

Amon also addressed the smartphone side of the business. He said Chinese handset revenue is expected to hit a low point in the current quarter, after which he anticipates a return to growth. That’s a relief for investors who’ve been watching that segment closely.

Automotive Hits a Milestone

Qualcomm’s automotive segment quietly had a standout quarter. Revenue came in at a record $1.3 billion — a 38% jump year-over-year. Annualized, that puts the segment above $5 billion.

The company is projecting that figure will exceed $6 billion by the end of fiscal 2026. That’s a segment that didn’t used to get much attention but is now pulling serious weight.

For the current quarter, Qualcomm guided for adjusted EPS of $2.10 to $2.30 on revenue of $9.2 billion to $10 billion. The midpoint of that revenue range is a step down from Q2, which is typical for seasonal patterns in the handset business.

How the Stock Looks

Qualcomm’s market cap sits at around $166.45 billion. The stock was already up about 15% over the prior 12 months heading into earnings.

The P/E ratio stands at 32.23x, which is on the higher end for the semiconductor sector. That reflects investor expectations for continued growth rather than current value alone.

GuruFocus gives the stock a GF Score of 89 out of 100, with particularly strong marks for profitability (9/10) and financial strength (7/10). Margins have been under some pressure over the past five years, which is a watch item.

On the insider activity front, insiders sold around $1.6 million worth of stock over the past three months. No buying was reported in that period.

The December quarter data-center chip shipment remains the key catalyst to watch from here.

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