Chipmaker Qualcomm (QCOM) is scheduled to announce its results for the fourth quarter of Fiscal 2025 after the market closes on Wednesday, November 5. QCOM stock surged recently when the company announced its plans to launch two new AI chips, the AI200 and AI250, in 2026 and 2027, respectively, for use in data centers. Qualcomm also announced a deal with Saudi Arabia–backed AI firm Humain to deploy 200 megawatts of its accelerator cards to support the country’s AI goals. Ahead of Q4 FY25 earnings, these announcements boosted investor confidence in Qualcomm’s ability to capture demand for AI chips.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Qualcomm, which has been dependent on the smartphone market for many years, is aggressively expanding into other areas such as automotive and IoT (Internet of Things). The launch of the new AI chips is expected to boost QCOM’s business amid rapid growth in data centers.
Meanwhile, Wall Street expects Qualcomm to report adjusted EPS of $2.87, reflecting a 6.7% growth from the prior-year quarter. Revenue is expected to rise 5% year over year to $10.76 billion.
Analysts’ Views Ahead of Qualcomm’s Q4 Earnings
Following the announcement of the AI chips, Bank of America analyst Tal Liani reaffirmed a Buy rating on QCOM stock with a price target of $200. The 5-star analyst views the launch of new AI chips as a “needed diversification” away from the low-growth smartphone market, which accounts for about 75% of the Qualcomm CDMA Technologies (QCT) segment’s revenue. Liani expects QCOM’s AI chips to capture opportunities in a market projected to grow to about $114 billion by 2030, with key customers looking for AI infrastructure suppliers beyond Nvidia (NVDA).
However, Liani cautioned that the 2026 opportunity related to the new AI chip is currently limited to a single deal. Also, Liani cautioned that Qualcomm needs to prove itself in terms of technical execution. Meanwhile, the analyst noted that QCOM stock’s underperformance relative to peers is due to concerns about the loss of revenue resulting from Apple’s (AAPL) shift to in-house modem chips, risk of losing some of Samsung’s (SSNLF) business, and exposure to the “secularly stagnant” smartphone market. That said, Liani remains bullish on QCOM stock due to its low valuation, given the company’s potential to expand its total addressable market and gain market share.
Meanwhile, Citi analyst Christopher Danely increased the price target for QCOM stock to $175 from $170 and maintained a Hold rating. Danely estimates that the Humain deal represents $1.0 billion in sales and $0.25 in EPS for Qualcomm. The 5-star analyst is skeptical about Qualcomm’s success in AI, as it is “several years behind” Advanced Micro Devices (AMD) and Nvidia.
AI Analyst Is Bullish on QCOM Stock Ahead of Q4 Print
Interestingly, TipRanks’ AI Analyst has assigned an Outperform rating to Qualcomm stock with a price target of $214, indicating about 19.3% upside potential. The AI analyst’s rating reflects Qualcomm’s solid financials and favorable earnings call insights, particularly in automotive and IoT growth. Additionally, the technical analysis suggests a bullish trend, though the AI Analyst cautioned about overbought signals.
The AI Analyst also indicated that QCOM stock’s valuation is fair, with a reasonable P/E multiple and moderate dividend yield. However, headwinds related to the loss of revenue from Apple and intense competition are notable risks.
Is QCOM Stock a Good Buy Now?
Heading into the results, Wall Street has a Moderate Buy consensus rating on Qualcomm stock based on seven Buys and three Hold recommendations. The average QCOM stock price target of $194.29 indicates 8.2% upside potential from current levels. QCOM stock has risen about 17% year-to-date.
