Qualcomm reported fiscal Q3 earnings that beat Wall Street forecasts. Net income rose to US$2.7 billion, or US$2.43 per share, up from US$2.1 billion, or US$1.88 per share, a year earlier.

The US-based chipmaker supplies processors and modems for smartphones, including devices from Samsung and Apple.

Revenue from its handset chip business reached US$6.33 billion, slightly below analyst expectations of US$6.44 billion.

Qualcomm projected adjusted earnings of US$2.85 per share and US$10.7 billion in revenue for the current quarter, both above analyst estimates.

Its internet of things (IoT) division posted US$1.68 billion in revenue, driven by stronger-than-expected chip use by Meta.

Automotive revenue rose 21% to US$984 million, while licensing revenue increased 11% to US$1.32 billion.

Qualcomm spent nearly US$1 billion on dividends and US$2.8 billion on share buybacks during the quarter.

🔗 Source: CNBC

🧠 Food for thought

1️⃣ Strategic diversification successfully offsets major customer dependency risks

Qualcomm’s earnings demonstrate how companies can strategically pivot away from dangerous customer concentration before it becomes fatal.

While the company faces an estimated $7.3 billion to $7.8 billion annual revenue loss when Apple completes its modem transition by 2028, Qualcomm’s diversification efforts are already showing strong results 1.

The automotive segment surged 59% year-over-year this quarter, while IoT grew 27%, indicating that alternative revenue streams are scaling rapidly 2.

By 2028, analysts project that automotive and IoT segments will contribute 49% of Qualcomm’s total modem revenue, effectively replacing the Apple business 1.

The company’s automotive revenue is approaching $1 billion annually and is projected to exceed $4 billion by 2026, showing how systematic expansion into adjacent markets can create substantial new revenue streams 34.

2️⃣ Edge AI strategy gains validation through consumer adoption

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