Qualcomm (QCOM) Q3 2026 earnings summary

Executive summary

• Fiscal Q3 2026 revenue reached $9.9 billion, at the high end of guidance, with non-GAAP EPS of $2.21 and GAAP EPS of $1.87; net income was $2.0 billion, down 25% year-over-year, mainly due to lower handset revenues and increased R&D and SG&A expenses.

• QCT revenues were $8.5 billion, with Automotive and IoT combined revenues up 28% year-over-year to $3.4 billion; Automotive grew 61% and IoT 9% year-over-year.

• QTL revenues were $1.3 billion, down 3% year-over-year, with EBT margin at 69%.

• Completed the acquisition of Modular Inc., strengthening the software foundation for generative and agentic AI.

• Returned $2.3 billion to shareholders via $1.4 billion in share repurchases and up to $1.0 billion in dividends.

Financial highlights

• Q3 FY26 revenues declined 4% year-over-year to $9.9 billion; non-GAAP EBT fell 24% year-over-year to $2.7 billion; non-GAAP EPS dropped 20% year-over-year to $2.21.

• QCT segment: revenues down 5% year-over-year, handsets down 20%, automotive up 61%, IoT up 9%.

• QTL segment: revenues down 3% year-over-year, EBT margin at 69%.

• Operating income for the quarter was $1.6 billion, down from $2.8 billion a year ago; operating margin was approximately 16%.

• Cash and cash equivalents at quarter-end were $4.5 billion; operating cash flow for nine months was $8.4 billion.

Outlook and guidance

• Q4 FY26 revenue guidance: $9.7–$10.5 billion; non-GAAP EPS: $2.05–$2.25; QCT revenues expected at $8.4–$9.0 billion with EBT margin of 25%–27%.

• Non-handset revenues, including Data Center, expected to accelerate from 24% growth in FY26 to over 60% in FY27, with FY29 non-GAAP EPS target raised to over $18.

• Data center revenue projected at $5 billion in 2027 and $15 billion in 2029; non-handset revenues to exceed 50% of QCT in 2027 and reach about two-thirds by 2029.

• Pricing actions to offset higher input costs are expected to benefit gross margins over time.

• Non-GAAP effective tax rate fixed at 12.5% for FY26.