Qualcomm Faces Headwinds: Analysts Slash Price Targets Ahead of Critical Earnings Report
SAN DIEGO – Qualcomm Inc. (NASDAQ: QCOM) enters a pivotal earnings week under a cloud of skepticism from Wall Street. The chipmaker's stock, down approximately 11% year-to-date, has seen multiple analysts reset their expectations downward, citing a fragile smartphone market and shifting dynamics with key customers like Apple and Samsung.
The downward revision trend began in early January when Mizuho Securities downgraded the stock to Neutral, cutting its price target from $200 to $175. This was followed by similar moves from Cantor Fitzgerald, UBS, and others, with several firms now clustering around a $160 price target. The consensus sentiment points to near-term challenges outweighing long-term opportunities in automotive and IoT.
"The core handset business is facing a perfect storm," said Michael Thorne, a semiconductor analyst at Fenwick Research. "Apple's in-sourcing efforts, Samsung's move to bring some modem development in-house, and broader demand softness in China are creating significant headwinds. While the automotive design wins with Volkswagen and Hyundai Mobis are strategically sound, they simply don't move the revenue needle enough yet."
According to Zacks Investment Research, consensus estimates for Qualcomm's upcoming earnings per share have slipped 2.5% over the past month. Wall Street currently expects Q1 EPS of $3.37 on revenue of $12.23 billion, a modest year-over-year sales increase but a profit decline.
Beyond smartphones, Qualcomm's narrative is one of diversification. At CES 2026, the company announced an expanded partnership with Volkswagen to become the primary tech provider for its new software-defined vehicle architecture and unveiled a next-generation robotics platform. However, with handset revenue still constituting the vast majority of its $27.8 billion FY2025 sales—compared to $4 billion from automotive—the company's fortunes remain tightly linked to the mobile cycle.
"The guidance for the coming quarters will be critical," added Thorne. "Analysts are anticipating commentary that may fall below consensus, particularly for the June quarter, due to component shortages and inventory adjustments."
Market Voices: A Split Reaction
We gathered perspectives from three investors on the current Qualcomm situation:
David Chen, Portfolio Manager at Horizon Growth Fund: "This is a classic case of market myopia. The Street is punishing Qualcomm for cyclical smartphone pressures but completely discounting the immense runway in automotive and IoT. The Volkswagen deal alone secures a decade of revenue visibility. We're using this weakness as a buying opportunity."
Sarah Jennings, Independent Retail Investor: "I'm frustrated but holding. The dividend is solid, and the company is still a cash flow machine. It feels like the market is overreacting to a temporary slowdown. Their technology in Snapdragon is still best-in-class."
Marcus Wright, Editor of 'The Hard Truth' Investing Newsletter: "It's a house of cards. Qualcomm has been living off Apple and Samsung for years, and that gravy train is ending. Their so-called 'diversification' into automotive is a tiny, low-margin business. These price target cuts are just the beginning. The core business is eroding, and management has no credible plan to replace it. Sell."
Qualcomm is scheduled to report its Q1 2026 earnings after the market closes on February 4.
This analysis incorporates data from Yahoo Finance, Zacks, TheFly, and company filings.