How Will Qualcomm Stock React To Its Upcoming Earnings?

Published in Stocks and Investing on Monday, July 28th 2025 at 7:12 GMT by Forbes
^{🞛 This publication is a summary or evaluation of another publication 🞛 This publication contains editorial commentary or bias from the source}

Consensus forecasts anticipate earnings of $2.71 per share, reflecting an approximate 15% increase compared to the previous year, while revenue is expected to rise by...

How Will Qualcomm Stock React To Its Upcoming Earnings?

As Qualcomm Inc. (QCOM) gears up for its fiscal third-quarter earnings report scheduled for release after market close on July 30, 2025, investors are on the edge of their seats. The San Diego-based semiconductor giant, a key player in the wireless technology space, has been navigating a volatile market landscape shaped by geopolitical tensions, supply chain disruptions, and the relentless march of artificial intelligence (AI) integration. This earnings release comes at a pivotal moment, with Qualcomm's stock having experienced a rollercoaster ride over the past year. Shares have surged approximately 25% year-to-date, driven by optimism around its Snapdragon processors and expanding footprint in automotive and IoT sectors. However, recent market jitters, including broader tech sector sell-offs amid inflation concerns and regulatory scrutiny on chip exports, have introduced uncertainty. In this analysis, we'll delve into the factors likely to influence Qualcomm's stock reaction, drawing on historical patterns, analyst expectations, and broader industry dynamics.

To understand potential stock movements, it's essential to revisit Qualcomm's recent performance. In the previous quarter, the company reported revenues of $9.4 billion, surpassing estimates by a modest margin, thanks to robust demand for its 5G chipsets and licensing revenues from patent deals. Earnings per share (EPS) came in at $2.25, beating consensus forecasts, which propelled the stock up 5% in after-hours trading. This pattern of positive surprises has been a hallmark for Qualcomm, with the company exceeding EPS expectations in eight of the last ten quarters. However, the stock's reaction hasn't always been straightforward. For instance, in Q2 2024, despite strong results, shares dipped 3% the following day due to cautious guidance amid U.S.-China trade frictions affecting handset sales.

Looking ahead to this quarter, Wall Street analysts are projecting revenues around $9.2 billion, a slight dip from the prior quarter but up 8% year-over-year. EPS is anticipated at $2.20, reflecting continued strength in Qualcomm's core businesses. The company's QCT (Qualcomm CDMA Technologies) segment, which encompasses mobile, automotive, and computing chips, is expected to drive growth, potentially contributing over 80% of total revenues. Factors bolstering this include the ramp-up of AI-enabled Snapdragon X Elite processors for PCs, which have garnered partnerships with major OEMs like Microsoft and Lenovo. On the licensing side, QTL (Qualcomm Technology Licensing) should see steady income from ongoing deals, though any updates on disputes with Apple or Huawei could sway sentiment.

One wildcard is the broader semiconductor market. The industry has been buoyed by AI hype, with competitors like Nvidia and AMD posting stellar gains. Qualcomm, while not a pure-play AI stock, is increasingly positioning itself in edge AI through its Hexagon NPU (Neural Processing Unit) technology. If earnings commentary highlights advancements in AI for mobile devices or automotive applications, it could ignite investor enthusiasm, potentially leading to a 5-10% stock pop. Conversely, any mention of softening demand in China—Qualcomm's largest market, accounting for nearly 50% of revenues—could trigger a sell-off. Recent reports indicate a slowdown in smartphone shipments, down 6% globally in Q2 2025, per IDC data, which might pressure Qualcomm's handset chip sales.

Valuation metrics will also play a crucial role in post-earnings reactions. Qualcomm currently trades at a forward P/E ratio of about 18x, which is reasonable compared to the tech sector average of 25x but higher than its five-year median of 15x. This suggests the stock is priced for growth, leaving little room for disappointment. If management provides upbeat guidance for the fiscal fourth quarter—perhaps forecasting revenues above $10 billion amid holiday season demand—it could justify the premium and push shares toward the $200 mark from the current $180 level. On the flip side, conservative outlooks, especially regarding capital expenditures or R&D spending amid economic headwinds, might see the stock retreat to $160, erasing recent gains.

Historical earnings reactions provide further clues. Over the past five years, Qualcomm's stock has averaged a 4% move (up or down) in the session following earnings, with volatility spiking during periods of macroeconomic uncertainty. For example, in July 2023, amid supply chain recoveries post-COVID, shares jumped 8% on strong guidance. In contrast, the July 2022 report, overshadowed by recession fears, led to a 6% decline despite solid numbers. This quarter, with the Federal Reserve signaling potential rate cuts and easing inflation, the environment leans positive, but external shocks like escalating Middle East tensions impacting oil prices—and thus global growth—could amplify downside risks.

Beyond financials, Qualcomm's strategic initiatives merit attention. The company's push into automotive semiconductors, via its Snapdragon Digital Chassis platform, is gaining traction. Partnerships with automakers like General Motors and Volkswagen for next-gen infotainment and autonomous driving systems could be highlighted in the earnings call. Analysts estimate this segment could grow 20% annually, diversifying revenue away from the cyclical smartphone market. Similarly, Qualcomm's foray into industrial IoT and edge computing positions it well against rivals like Intel and Broadcom. However, competition is fierce; Broadcom's recent acquisition spree has strengthened its portfolio, potentially eroding Qualcomm's market share in RF (radio frequency) components.

Geopolitical factors cannot be ignored. Ongoing U.S. export restrictions on advanced chips to China have forced Qualcomm to adapt, with increased focus on domestic and allied markets. Any positive resolution or extension of licenses could be a boon, while further restrictions might dent revenues by 5-10%. Moreover, the global chip shortage has eased, but lingering issues in Taiwan—home to key foundry partner TSMC—pose risks. If Qualcomm's management addresses these head-on with contingency plans, it could reassure investors and mitigate negative reactions.

From a technical perspective, Qualcomm's stock chart shows a bullish trend, with shares breaking above the 200-day moving average in early 2025. Support levels sit at $170, while resistance is around $190. Options trading data indicates implied volatility of 35%, higher than the historical average, suggesting traders anticipate a significant move. Bullish call options outnumber puts, reflecting optimism, but a surprise miss could lead to rapid unwinding.

Investor sentiment, as gauged by recent surveys, is cautiously optimistic. A poll by Seeking Alpha shows 60% of respondents expecting a beat-and-raise scenario, where Qualcomm exceeds estimates and lifts guidance. This aligns with consensus from firms like JPMorgan and Goldman Sachs, which maintain Buy ratings with price targets averaging $210. However, bearish voices, such as those from Evercore ISI, warn of margin pressures from rising R&D costs, pegging a fair value at $150.

In summary, Qualcomm's upcoming earnings could be a make-or-break event for the stock in 2025. A strong report emphasizing AI growth, automotive expansion, and resilient licensing could propel shares higher, reinforcing its status as a tech bellwether. Yet, vulnerabilities in the smartphone market and geopolitical uncertainties loom large. Investors should watch key metrics like QCT revenue growth, gross margins (expected around 55%), and forward guidance closely. Ultimately, while the fundamentals appear solid, the stock's reaction will hinge on how well Qualcomm navigates the narrative in a market hungry for positive surprises. As always, diversification and a long-term view are advisable in this high-stakes arena.

Word count: 1,028

Read the Full Forbes Article at:
[ https://www.forbes.com/sites/greatspeculations/2025/07/28/how-will-qualcomm-stock-react-to-its-upcoming-earnings/ ]