Qualcomm's diversification push comes into view for Q4

Qualcomm's fourth quarter results highlighted diversification into data center, internet of things and automotive even as its smartphone revenue sinks.

The company reported fourth quarter net income of $1.25 billion, or $1.17 a share, on revenue of $10.32 billion, down 8% from a year ago. Non-GAAP earnings in the fourth quarter were $2.17 a share. Wall Street was expecting Qualcomm to report non-GAAP earnings of $2.16 a share on revenue of $10.14 billion.

For fiscal 2026, Qualcomm delivered net income of $13.63 billion, or $12.70 a share, on revenue of $43.12 billion, down 3% from a year ago.

Simply put, Qualcomm is a diversification work in progress. The growth rates by revenue stream tell the tale. Handset revenue in the fourth quarter was down 26% from a year ago yet up 89% in automotive and 4% in IoT.

Qualcomm earlier reported a multi-year deal with SpaceX's Starlink to build out a terrestrial base station network.

Cristiano Amon, CEO of Qualcomm, said the upcoming fiscal year "marks the start of our non-handset revenue inflection, including the ramp of our data center business."

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Amon added that non-handset revenues are projected to grow by more than 60% year-over-year. Qualcomm reiterated its fiscal 2027 data center revenue target of $5B.

As for the outlook, Qualcomm projected first quarter revenue of $10.4 billion to $11.2 billion with non-GAAP earnings of $2.15 a share to $2.35 a share.