Qualcomm quarterly forecast underwhelms, but CEO says worst of memory crunch over

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SAN FRANCISCO, April 29 : Qualcomm forecast third-quarter revenue and adjusted profit below Wall Street expectations on Wednesday, as the chipmaker braces for a hit to demand stemming from a shortage of memory chips used in consumer electronics.

Shares of the company fell around 4 per cent in extended trading.

But in an interview with Reuters, Qualcomm CEO Cristiano Amon said the company was confident that the smartphone market will start to rebound after its fiscal third quarter.

"We can now call the bottom," Amon said, adding that the company's licensing business, which beat Wall Street estimates, gives it insights into smartphone makers' plans for later in the year.

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The company expects revenue of between $9.2 billion and $10 billion, a range entirely below estimates of $10.27 billion, according to data compiled by LSEG. 

Qualcomm is one of the largest smartphone semiconductor firms in the world, counting major players such as Apple and Samsung as customers, as well as major Chinese phone brands.

But this year, the company has faced extreme uncertainty from smartphone customers as a surge in prices of memory chips have also led to increases in smartphone and PC costs, prompting consumers to cut back on purchases. 

It forecast third-quarter adjusted profit of between $2.10 and $2.30 per share, compared with estimates of $2.45 per share. 

The company reported second-quarter revenue of $10.6 billion, in line with expectations. 

Global smartphone shipments declined 6 per cent in the first three months of the year amid the memory crunch, according to Counterpoint Research, which added that the shortages may last until late next year.  

Due to its large exposure to the consumer electronics segment by virtue of selling chips for wireless headphones and automotive computing systems in addition to phones, Qualcomm's results are seen as a barometer for the market's health and an indicator for demand and supply dynamics.

The Chinese handset market is expected to deal more of a blow to Qualcomm as local manufacturers saw a downturn in sales due to the memory chip crunch. Lower-to-mid-tier devices are also expected to be more severely affected rather than premium device makers. 

The company's shares have fallen around 10 per cent so far this year after rising over 11 per cent in 2025, as investors grapple with the impact of a tight memory market driven by demand from AI data centers. 

Last month, Qualcomm unveiled a $20 billion stock buyback program to reassure investors amid the demand downturn.

In addition to smartphones, Qualcomm is working to break into the booming data center chip market, which it will start shipping products for before the end of the year. 

Amon on Wednesday said the company is working with customers on three kinds of chips: central processor units (CPUs), accelerators for inference, and custom chips called ASICs, a booming market for rivals such as Broadcom and Marvell.

"We have engagement on a custom ASIC, which is what we wanted to do when we bought AlphaWave," Amon said, "and now we have a lot of connectivity (intellectual property) that enables us to do that. We're executing on all three" categories of chips. 

The growing usage of chips in smartphones and PCs spurred by a shift to premium and AI-powered devices is expected to benefit companies such as Qualcomm in the form of higher chip revenue, analysts have said.

Second-quarter revenue for Qualcomm's chip segment was $9.08 billion, missing estimates of $9.21 billion.

The company forecast third-quarter chip revenue of between $7.9 billion and $8.5 billion, below estimates of $8.93 billion. 

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