QUALCOMM Incorporated Q2 FY2026 earnings call

Automotive: Exceeded $5 billion in annualized revenues in Q2, expects to exit fiscal 26 at a run rate above $6 billion, with fourth-generation Snapdragon digital chassis platform driving growth, and will begin commercial shipments of fifth-generation platform. IoT: Agentic workloads and edge AI driving product renewal, Dragon Wing IQ10 platform generating customer interest, multi-year agreement with Nura, Ventuno Q introduced. Personal AI: Significant increase in new smart glasses expected in second half of year, Snapdragon X2 PC platforms in production. Data center: AlphaWave integration off to good start, entering custom silicon space, initial shipments expected in December quarter. Handsets: China Android revenue bottoming out in fiscal Q3, agentic smartphones expected to influence premium tier.

In Fiscal Q2, QCT revenues were $9.1 billion. Licensing business revenues were $1.4 billion. QCT IoT revenues were $1.7 billion, up 9% year-over-year. QCT Automotive revenues were $1.3 billion, representing 38% year-over-year growth. On a combined basis, QCT automotive and IoT revenues grew 20% year-over-year.

Third fiscal quarter forecast: Revenues $9.2 to $10 billion, non-GAAP EPS $2.10 to $2.30. QTL revenues $1.15 to $1.35 billion, EBT margins 67% to 71%. QCT revenues $7.9 to $8.5 billion, EBT margins 25% to 27%. QCT handset revenues from Chinese customers expected to bottom in Q3 and return to sequential growth in Q4. QCT IoT revenues expected to grow high single digits y/y. QCT Automotive expected to see year-over-year revenue growth accelerate to approx 50% in third fiscal quarter.

Impact of memory industry dynamics on handset business, uncertainty in memory supply and price increases affecting handset OEMs' build plans. Market competition and evolving technology trends posing challenges.

Q: About custom silicon engagement with large hyperscaler, any details?

A: Can't provide much detail, it's a large hyperscaler, multi-generation engagement.

Q: Why confident China Android sales bottom in Q3?

A: Impact of channel inventory drawdown factor, and licensing business visibility on sell-through.

Q: Competitive landscape in data center?

A: CPU, accelerator, edge position, and agentic transition implications.

Q: Handset seasonality into September quarter?

A: China handsets bottom in Q3, Apple product revenue growth quarter, those are input factors.

Q: Automotive ADAS mix impact?

A: Significant revenue accelerator, transitioning to SIP sale and software opportunity helps margin.