US Stock Market Move | Q4 mobile phone chip business revenue plunges 26%; Qualcomm (QCOM.US) drops over 11% in premarket trading.

On Thursday, Qualcomm (QCOM.US) plunged more than 11% in premarket trading to $152.81. On the news front, Qualcomm reported fourth-quarter results, with non-GAAP revenue of $10.442 billion and earnings per share of $2.17, slightly beating expectations. Revenue from Qualcomm's handset chip business in the fourth quarter was only $5.14 billion, down 26% year-over-year, below the $5.25 billion estimate compiled by Visible Alpha. Qualcomm's guidance for the first fiscal quarter also disappointed the market, with earnings per share in the range of $2.15 to $2.35, the midpoint of which was below the analysts' average estimate of $2.32; revenue guidance ranged from $10.4 billion to $11.2 billion, with the midpoint essentially in line with analysts' expectations. Analysts believe that massive demand for high-bandwidth memory from AI servers has driven up memory chip prices, which in turn has raised the overall costs of consumer electronics products and squeezed the profit margins of smartphone chipmakers such as Qualcomm. The global smartphone market is experiencing a downturn. Data from Counterpoint Research shows that global smartphone shipments in the third quarter fell 20% year-over-year, hitting a 14-year low. Qualcomm acknowledged that the semiconductor industry is facing broad cost increases across multiple stages, including wafer manufacturing, assembly, testing, advanced packaging, and memory. The company has already taken pricing measures, but expects the full impact on gross margin to be fully reflected only in the second half of fiscal 2027.