Prediction: This Artificial Intelligence (AI) Stock Will Crush the Market in 2025

Core Viewpoint - The growing demand for generative AI smartphones is expected to significantly boost Qualcomm's performance in 2025, despite its recent underperformance in the semiconductor sector [1][2]. Financial Performance - Qualcomm's fiscal fourth-quarter 2024 results showed a revenue increase of 18% year over year to $10.2 billion, with adjusted earnings rising 33% to $2.69 per share, surpassing analysts' expectations [4]. - The company provided better-than-expected guidance for fiscal 2025 Q1, forecasting earnings of $2.95 per share on revenue of $10.9 billion, exceeding analysts' estimates [5]. Market Position and Growth Potential - Qualcomm is a dominant player in the smartphone chip market, benefiting from the production ramp of Apple's iPhone 16 models, which utilize Qualcomm's Snapdragon X75 modem [7]. - Samsung is expected to launch its Galaxy S25 series, likely powered entirely by Qualcomm's processors, enhancing Qualcomm's sales prospects [9]. - The generative AI smartphone market is projected to grow at an annual rate of 78% through 2028, with Qualcomm positioned to capture over 50% of this market [11][13]. Competitive Landscape - Qualcomm has been gaining market share from MediaTek, which is expected to hold only a 13% share of the generative AI smartphone market, while Qualcomm is projected to secure more than 50% [13]. Valuation and Investment Outlook - Analysts have raised earnings expectations for Qualcomm for fiscal 2025 and 2026, suggesting a potential stock price increase to $336, nearly double the current price [15]. - The current forward earnings multiple of 15 indicates a solid discount on Qualcomm's stock, making it an attractive investment opportunity [16].