Upgrade to Buy#
Summit Insights has upgraded Qualcomm Inc. (NASDAQ: QCOM) from a Hold to a Buy rating. This change is based on the company's efforts to diversify its business and capitalize on opportunities in artificial intelligence (AI).
Analyst Insights#
Analyst Kinngai Chan believes that the current stock price reflects the losses Qualcomm has faced from its relationship with Apple Inc. and challenges in the Android market. Chan emphasized that Qualcomm's future growth will depend on its ability to expand beyond its traditional focus on handsets.
AI Opportunities#
Summit Insights predicts that Qualcomm’s products related to AI data centers will become significant contributors to its revenue by 2027. The firm expects that as Qualcomm shifts its focus toward AI applications, its stock will start to outperform other companies in the semiconductor sector. Chan stated, "We expect QCOM shares to start outperforming the semiconductor peer group as the company pivots to AI."
Recent Financial Performance#
In its latest fiscal second-quarter results for 2026, Qualcomm exceeded Wall Street expectations with earnings per share (EPS) of $2.65, surpassing the forecast of $2.55. The company reported revenue of $10.6 billion, slightly above the anticipated $10.58 billion, driven by strong performance in its automotive and Internet of Things (IoT) segments. Additionally, HSBC raised its price target for Qualcomm from $150 to $155 while maintaining a Hold rating, noting the company's strategic shift towards AI, especially in the AI datacenter market announced in late October 2025. However, HSBC pointed out that there is still uncertainty regarding product specifics and customer demand in the supply chain.
These developments highlight Qualcomm's ongoing adjustments in strategy and its efforts to enhance market performance.