Qualcomm Stock Slides After Earnings Beat

Core Insights - Qualcomm's stock is experiencing a decline despite reporting strong earnings, with adjusted earnings of $3.00 per share and revenue of $11.27 billion, both exceeding Wall Street estimates [3][4] - The company's guidance for the first quarter also surpassed projections, but rising expenses and a soft outlook for automotive chip sales have raised concerns [3][4] Financial Performance - Fourth-quarter chip revenue reached $9.8 billion, exceeding the consensus estimate of $9.4 billion, with a year-over-year increase of 13%, and an 18% increase when excluding the declining business with Apple [4] - Licensing revenue decreased but was not as severe as anticipated, highlighting Qualcomm's strong position in the cellular radio chip market [6] Market Position and Challenges - Qualcomm maintains a dominant position in the high-end Android phone market, despite overall weak global Android phone sales [5] - The company faces ongoing conflicts with major customers, particularly Apple, which is transitioning away from Qualcomm's chips for its devices [7][8] Future Prospects - Qualcomm is focusing on new AI accelerator chips and servers, which are expected to generate significant revenue by 2027, although the company must convince customers to choose its products over established competitors like Nvidia [8][9] - The challenge lies in attracting customers beyond major cloud service providers, who often prefer their own chip solutions [9]