$QCOM · The Motley Fool · 2026-11-05

Qualcomm shares are down 9% as we tape. Uh earnings came in more or less as expected. Guidance was a little light. It's fair to say that the Qualcomm stock would have been down regardless of what it put up just based on how everything else in the stock market is reacting today.

But I think that one of the things that investors are really looking at here, there's a lot of kind of just stabilization in the business, kind of just a eh part of the business.

But as far as the growth driver long-term goes, it's really leaning into data center. And that's what's being called into question today.

Qualcomm really leaning into that, but is it getting called into question? That's the growth driver from here. So, this is, I think, what investors are reacting to.

I don't know if it was specifically Qualcomm, but one thing they did say was lighter gardens.

the one thing that did point stand out to me a little bit was they were saying, "Hey, memory costs are high for us and it's it's getting harder to get memory chips for some of the things we're doing." unlike a lot of the stocks we've seen, the AI trade stocks that have kind of plunged after earnings, this one really makes sense.

So, in in Qualcomm's case, they beat significantly on revenue. Their margins missed expectations, so their earnings were just a little bit better than expected. Uh, a lot of that, you know, the memory prices like you mentioned right there. Um, and and the guidance was really weak.

There are some catalysts coming up. We could talk about the deal they just announced with SpaceX, for example, uh that aren't going to show up in the numbers for a little while.

Qualcomm was down 6% after hours yesterday and at the time the NASDAQ futures were pointing up. So it it's it's not just that Qualcomm's completely causing this crash. It really is the political fears of what it means for the data center buildout.

Historically, Qualcomm has like their big business has been supplying chips mostly for mobile phone devices. They're a huge supplier to Apple and so mobile devices were a little bit weak.

That may change though because Qualcomm did just recently sign a deal to kind of be the exclusive provider for SpaceX who apparently is looking to on top of that rumors of a boost mobile deal really trying to dive hard into telecommunications and being a telecom provider competing with the T-Mobiles and the Verizons of the world.

John, is this really like a move the needle thing for Qualcomm in terms of like what they're going to sell? I'm tempted to say it's more sizzle than stake and looks great in a press release, but I'm willing to be convinced otherwise.

Well, if there is any stake here, we're not going to have it for a few more years. And that's because SpaceX does want to be this kind of hybrid satellite cellular provider and really wanting to build out to thousands of sites using Qualcomm's technology as part of it.

That's not going to even start until next year at the earliest and then it's going to take a long time to actually roll out and deploy. It's really laying the groundwork for 6G, which that's not expected until maybe 2030 or so.

So this is something that maybe is going to be a big deal for Qualcomm in the future, but that ex that assumes execution from SpaceX. And even if it does execute, it's not going to materialize for shareholders a really big business boost for several years.