Qualcomm Q4 FY2026: revenue $10.3B, handsets down 26%, data center target $5B for FY2027

Qualcomm reported fiscal fourth-quarter 2026 results on 4 November: revenue of $10.32 billion (GAAP), down 8% from a year earlier, as handset chip sales fell 26%, while automotive passed $2 billion in a quarter for the first time. The part investors focused on was data centers. Qualcomm reiterated a fiscal 2027 data center revenue target of $5 billion, and its shares fell more than 8% in after-hours trading, per The Elec, because next-quarter earnings guidance came in a touch below consensus.

Key points

• Q4 fiscal 2026 revenue was $10,322 million GAAP (down 8%) and $10,442 million non-GAAP (down 7%); non-GAAP EPS was $2.17, down 28% (Qualcomm release).
• Fiscal 2026 revenue was $43.12 billion GAAP, down 3%, and $43.24 billion non-GAAP, down 2%.
• Handset revenue fell 26% to $5,137 million; automotive rose 89% to $1,990 million; IoT rose 4% to $1,888 million.
• Qualcomm guides Q1 fiscal 2027 revenue of $10.4 to $11.2 billion and reiterated a $5 billion data center target for fiscal 2027.
• Some coverage misstates the scale: The Verge wrote that Qualcomm's "total revenue for 2026 was $10.4 billion". That is the quarter, not the year.

What happened

In its results release for the quarter and fiscal year ended 27 September 2026, Qualcomm said non-GAAP revenue was at "the high end of our guidance". Chief executive Cristiano Amon said fiscal 2027 "marks the start of our non-handset revenue inflection, including the ramp of our Data Center business", and that non-handset revenue is projected to grow by more than 60% year over year.

The release also listed three licensing renewals, with Apple, Huawei and Transsion, and a "multi-generational product collaboration with Amazon for AI data centers".

Reaction was negative on the guidance. The Elec reported that the midpoint of next-quarter non-GAAP EPS guidance, $2.25 (the range is $2.15 to $2.35), fell short of the $2.27 consensus, and that shares dropped more than 8% in after-hours trading. The Elec also put Wall Street's revenue estimate for the quarter at $10.14 billion, which the result beat.

Background

Qualcomm has made most of its money from smartphone chips and patent licences. The Verge reported that smartphone sales are down about 20% compared with 2025, and The Elec attributed the handset slump to major phone makers scaling back production plans amid memory supply constraints and rising component prices. Qualcomm's own release acknowledges "a broad-based increase in input costs across wafer fabrication, assembly, test, advanced packaging, memory and other materials", and says it is raising product prices, with the full benefit expected in QCT gross margins only in the second half of fiscal 2027.

The shift to data centers has been signalled for months. We have covered the same pressure on chip budgets in Apple's quarter, and the contrast with AMD, whose Data Center revenue rose 97% in the same season, shows how different the starting points are.

The numbers

Handsets are still the biggest stream in the chip business (QCT), with $24.07 billion of the $37.21 billion QCT revenue for the year, but it is shrinking. Automotive is the bright spot, with fiscal 2026 revenue of $6.0 billion, up 52% from $3.96 billion.

Handsets5137

Automotive1990

IoT1888

Qualcomm Q4 fiscal 2026 chip revenue by stream (US$ million)

	US$ million
Handsets	5137
Automotive	1990
IoT	1888

Source: Qualcomm Q4 fiscal 2026 results release (Form 8-K exhibit 99.1)

type: bar
title: Change in revenue versus Q4 fiscal 2025
unit: %
source: Qualcomm Q4 fiscal 2026 results release (Form 8-K exhibit 99.1)
highlight: Automotive
Automotive | 89
IoT | 4
Handsets | -26

Profitability fell faster than sales. The chip business (QCT) earned pre-tax profit of $2,142 million in the quarter, 24% of its revenue, down from $2,896 million and 29% a year earlier. Fiscal 2026 QCT revenue was $37.2 billion, down 3%, and QCT pre-tax profit was $10.1 billion, down 13%, a 27% margin against 30%. For the first quarter of fiscal 2027, Qualcomm guides QCT revenue of $9.0 to $9.6 billion (now including data center) and licensing revenue of $1.3 to $1.5 billion, with non-GAAP EPS of $2.15 to $2.35.

Qualcomm returned about $2.0 billion to shareholders in the quarter ($1,011 million in buybacks and $987 million in dividends, $0.92 a share) and $11.7 billion over the fiscal year.

Licensing (QTL) brought in $1,304 million in the quarter, down 7%. The company-wide totals: GAAP net income for the year was $13.6 billion, but that includes a $5.7 billion tax benefit from releasing a valuation allowance, so non-GAAP net income ($11.3 billion, down 15%) is the cleaner comparison.

What it means

The data center plan is large relative to the rest of the business. According to The Elec, Qualcomm expects data center revenue to exceed $650 million in the December quarter, shipments to rise each quarter, and an annualised run rate of as much as $7 billion by the end of fiscal 2027. The Verge reports a longer-term goal of $15 billion by 2029 and that data centers should eventually be about 30% of the business. Qualcomm's release only confirms the $5 billion fiscal 2027 target, so we treat the other figures as reported from the earnings call by those outlets, not as items in the release.

For comparison with the roughly $43 billion Qualcomm earned in fiscal 2026, a $5 billion data center year would be about 12% of that, so the company is asking investors to look past a shrinking phone business. The risk is timing: the release names only Amazon as a data center collaboration partner, and the first quarter of revenue is still ahead.

Winners and losers: automotive suppliers and OEMs using Snapdragon cockpit and driver-assistance platforms are a clear gain for Qualcomm. Phone makers face the same component inflation Qualcomm is passing on. Rivals such as AMD, which says it expects over 80% of revenue from data centers (per The Verge), are far further along.

What we don't know yet

• How much of the $5 billion comes from custom silicon and how much from standard accelerator products.
• Whether handset revenue stabilises when memory costs ease.
• Full-year margin effects of price increases, which Qualcomm says arrive in the second half of fiscal 2027.
• The exact commercial terms of the Amazon collaboration, which the release does not give.

What to watch next

The first real data point is the December quarter report (fiscal Q1 2027), which should show whether data center revenue exceeds $650 million as guided. Then watch the QCT margin, which Qualcomm says drops as it invests ahead of revenue, and whether Q2 guidance holds the $5 billion path.

Sources

• Qualcomm Announces Fourth Quarter and Fiscal 2026 Results (Form 8-K, exhibit 99.1) (primary)
• The Elec: Qualcomm's fourth-quarter revenue beats estimates
• The Verge: Qualcomm is betting big on data centers as smartphone sales sink