Dear Qualcomm Stock Fans, Mark Your Calendars for July 29

Artificial intelligence has helped the semiconductor industry achieve another great year, but not all companies in the semiconductor industry have performed equally well this year. One company lagging some of its peers is Qualcomm (QCOM). Investors' concerns primarily revolve around the pace of recovery in the smartphone market and the company's transition into new growth areas like AI PCs, automotive, and data center processors.

This is why the coming Wednesday's release of fiscal third-quarter earnings results is especially critical for Qualcomm. Even though Wall Street is expecting year-over-year (YoY) falls in both revenues and EPS, Qualcomm's management has always insisted that the company's long-term opportunity stretches far beyond the company's smartphone business. The company is scheduled to report its results after the close of the market on July 29.

About Qualcomm Stock

Qualcomm is one of the top semiconductor firms in the world, developing mobile processors, wireless technologies, automotive semiconductors, Internet of Things processors, and artificial intelligence hardware products. The company is headquartered in San Diego, California, and has a market capitalization of approximately $179.2 billion, ranking among the largest fabless semiconductor design firms.

Stocks of the company have been having a tough year. Presently, QCOM stock is trading at around $163 per share, 37% below its 52-week high of $259.92 but still 36% above its 52-week low of $121.99.

Despite the current concerns about the company's prospects, Qualcomm's valuation appears to be significantly lower than most semiconductor stocks with ties to artificial intelligence. Its stock trades at approximately 20.9 times forward earnings and 4.0 times sales, both figures being notably lower than many other semiconductor firms. This relatively low valuation indicates that investors are skeptical about the firm's ability to increase revenues during its transition into artificial intelligence, automotive technology, and the Internet of Things, as well as custom data center semiconductors.

Qualcomm is also known as one of the most attractive income-generating companies in the semiconductor industry, though income is not the main investment attraction of the stock. Rather, the firm's generous dividend payments, together with share repurchase programs and solid cash flows, serve as an additional source of shareholder value.

Qualcomm Beat on Earnings. Can It Do It Again?

The latest quarter of Qualcomm demonstrated that the company performs rather well despite difficult operational conditions. Q2 fiscal revenues came in at $10.60 billion, barely surpassing analysts' forecasts, whereas the adjusted EPS was $2.65, beating the street estimates by $2.56. The GAAP EPS soared to $6.88 due to the one-time tax gain of $5.7 billion; therefore, the adjusted EPS is the better measure of the company's performance.

As for the operational challenges, the management admitted the difficulty of the memory market conditions but insisted that artificial intelligence has become the key component of each product roadmap. For instance, the company's CEO, Cristiano Amon, pointed out the rising importance of AI agents while confirming that the first custom silicon program of the company for one of the leading hyperscale customers will be ready for shipment by the end of the year. The company also mentioned its ambitions in physical AI and data center computing.

Capital allocation has remained another bright point of the company's operation. During the first half of fiscal 2026, Qualcomm repurchased $5.4 billion worth of its shares while launching the additional share repurchase program amounting to $20 billion.

As for the coming quarter, Wall Street expects a much weaker report from the company. According to the estimates, the Q3 revenues will come in at $9.67 billion, falling by 6.7% year-over-year (YoY), whereas the adjusted EPS is expected to fall by almost 20%, to $2.22. What is even more alarming is that the analyst community is expecting a much weaker Q3 quarter. Over the past three months, there have been 24 downward revisions to EPS, while only two were upward; as a result, the company's Revision Grade became “D.” This makes the bar relatively low before the earnings report and leaves a chance for an upside surprise in case of higher guidance and positive remarks about AI.

What Do Analysts Expect for QCOM Stock?

Notwithstanding the reduction of estimates, Wall Street is generally bullish on QCOM stock with a “Moderate Buy” rating consensus. The average price target is currently $220.59, which is about 35% above the current price of $163.19. The highest target of $314 seems even more optimistic if Qualcomm successfully develops outside of smartphones to AI computing, automotive platforms, and hyperscale custom silicon.