Qualcomm's $5 billion goal leans on two buyers. One gets rights to its stock as it buys
Qualcomm reported a 26% drop in quarterly phone-chip sales and kept its $5 billion data-center target. Its annual report shows the units holding that business sold $476 million in fiscal 2026 and lost more than that.
KeyVex News··6 min readFact-checked against 4 public recordsKeyVex News··6 min readFact-checked against 4 public records
QCOM$173.19▲ 5.3%Close, Nov. 4. Prices from Tiingo.The short versionTap to readTap to close
- Qualcomm sells chips and patent licenses worldwide. Yet two customers, Apple and Samsung, brought in 42% of its revenue in the fiscal year that ended Sept. 27, its annual report shows.
- The report says Apple will mostly use its own modems from now on. Apple still licenses Qualcomm's patents, but chip sales that go away have to be replaced, or total sales shrink.
- Qualcomm kept a $5 billion target for data-center sales in fiscal 2027. The units that include data center sold $476 million in fiscal 2026 and lost $607 million before taxes, more than they sold.
- Most of the $5 billion is to come from two cloud customers, the CEO said. One, Amazon, gains rights to buy Qualcomm shares at $161.26 as it buys, booked as a cut to revenue.
- Next: Qualcomm expects more than $650 million of data-center sales in the December quarter, the first in which it reports them inside its chip business.
The results: Qualcomm's sales of phone chips fell 26% from a year earlier, to $5.14 billion, in the quarter that ended Sept. 27, the company reported after the market closed on Nov. 4.8-K Its annual report, filed the same afternoon, names its two biggest customers: Apple and Samsung, the only ones that each brought in 10% or more of revenue in fiscal 2026.10-K The report puts them at 22% and 20% without saying which is which, and counts chip sales and patent royalties together.10-K
The exit: The same report says Qualcomm expects that "Apple will primarily use its own internally developed modem products, rather than our products, in its devices going forward."10-K On that afternoon's call, according to a transcript published by TradingKey, chief executive Cristiano Amon listed "the loss of Apple as a customer" among uncertainties now behind Qualcomm.Call Apple still pays for Qualcomm's patents: the two renewed their long-term license, the company said.8-K
Why it matters: Qualcomm expects Apple to switch mostly to its own modems, its annual report says.10-K The same report shows that the units holding its data-center business, which Qualcomm targets at $5 billion of sales in fiscal 2027, are still small and lost money.10-K8-K Most of that target is to come from two cloud customers, Amon said.Call One of them, Amazon, holds a warrant to buy up to 25 million Qualcomm shares that vests as it buys.8-K
The stock: Qualcomm closed at $173.19 on Nov. 4, before the results.Chart data At 10:20 a.m. the next day it traded at $157.58, down 9.0%, according to a single quote via KeyVex.KeyVex
Qualcomm's stock and the story's key datesDaily close, June 1 to Nov. 4, 2026 ▼ 24.4%Show chartHide chart
- 1Sept. 8, 2026 Qualcomm discloses the Amazon warrant. Up to 25 million shares at $161.26, issued Sept. 3 and vesting as Amazon buys. The 8-K was accepted at 9:00 a.m.
- 2Oct. 2, 2026 Qualcomm registers the warrant shares for resale. A shelf registration lets the Amazon affiliate sell up to 25 million shares it gets from the warrant. Accepted at 4:30 p.m.
- 3Nov. 4, 2026 Results and the annual report, after the close. Handset chip sales down 26% in the quarter; the $5 billion data-center target for fiscal 2027 reaffirmed. Qualcomm closed at $173.19 before the release.
View the data (110 trading days)
| Date | Close | Day change |
|---|---|---|
| 2026-11-04 | $173.19 | +5.3% |
| 2026-11-03 | $164.43 | +1.4% |
| 2026-11-02 | $162.08 | −1.6% |
| 2026-10-30 | $164.79 | −11.1% |
| 2026-10-29 | $185.41 | +1.3% |
| 2026-10-28 | $182.97 | −0.7% |
| 2026-10-27 | $184.17 | +2.5% |
| 2026-10-26 | $179.60 | +2.1% |
| 2026-10-23 | $175.91 | +1.8% |
| 2026-10-22 | $172.83 | −2.9% |
| 2026-10-21 | $177.96 | +1.3% |
| 2026-10-20 | $175.71 | +1.3% |
| 2026-10-19 | $173.53 | +0.8% |
| 2026-10-16 | $172.11 | −3.5% |
| 2026-10-15 | $178.40 | +3.3% |
| 2026-10-14 | $172.62 | −2.4% |
| 2026-10-13 | $176.86 | +1.4% |
| 2026-10-12 | $174.43 | −0.6% |
| 2026-10-09 | $175.50 | −0.3% |
| 2026-10-08 | $176.01 | −0.6% |
| 2026-10-07 | $177.12 | −2.2% |
| 2026-10-06 | $181.03 | +0.1% |
| 2026-10-05 | $180.79 | −2.2% |
| 2026-10-02 | $184.87 | +1.5% |
| 2026-10-01 | $182.09 | −1.1% |
| 2026-09-30 | $184.04 | 0.0% |
| 2026-09-29 | $184.10 | −1.8% |
| 2026-09-28 | $187.48 | −7.2% |
| 2026-09-25 | $201.97 | +4.0% |
| 2026-09-24 | $194.26 | −1.5% |
| 2026-09-23 | $197.24 | −0.5% |
| 2026-09-22 | $198.27 | +2.1% |
| 2026-09-21 | $194.23 | +9.3% |
| 2026-09-18 | $177.72 | −5.8% |
| 2026-09-17 | $188.71 | +2.1% |
| 2026-09-16 | $184.84 | −1.6% |
| 2026-09-15 | $187.80 | +4.2% |
| 2026-09-14 | $180.15 | −1.0% |
| 2026-09-11 | $181.97 | +2.9% |
| 2026-09-10 | $176.88 | +0.3% |
| 2026-09-09 | $176.40 | +1.3% |
| 2026-09-08 | $174.09 | +3.2% |
| 2026-09-04 | $168.74 | +0.1% |
| 2026-09-03 | $168.57 | −0.8% |
| 2026-09-02 | $169.96 | +2.0% |
| 2026-09-01 | $166.61 | −2.3% |
| 2026-08-31 | $170.48 | +3.8% |
| 2026-08-28 | $164.19 | −0.4% |
| 2026-08-27 | $164.78 | +0.6% |
| 2026-08-26 | $163.72 | +2.0% |
| 2026-08-25 | $160.56 | +1.3% |
| 2026-08-24 | $158.53 | −1.4% |
| 2026-08-21 | $160.75 | 0.0% |
| 2026-08-20 | $160.74 | −0.7% |
| 2026-08-19 | $161.91 | +1.1% |
| 2026-08-18 | $160.19 | −1.2% |
| 2026-08-17 | $162.18 | −2.2% |
| 2026-08-14 | $165.79 | +0.6% |
| 2026-08-13 | $164.79 | +1.1% |
| 2026-08-12 | $163.07 | +0.2% |
| 2026-08-11 | $162.68 | +0.3% |
| 2026-08-10 | $162.17 | −3.4% |
| 2026-08-07 | $167.86 | +4.7% |
| 2026-08-06 | $160.39 | +1.8% |
| 2026-08-05 | $157.53 | −3.2% |
| 2026-08-04 | $162.67 | +7.3% |
| 2026-08-03 | $151.57 | +2.7% |
| 2026-07-31 | $147.61 | −2.6% |
| 2026-07-30 | $151.60 | −2.6% |
| 2026-07-29 | $155.68 | −4.4% |
| 2026-07-28 | $162.88 | −4.2% |
| 2026-07-27 | $170.04 | +1.8% |
| 2026-07-24 | $166.97 | −2.4% |
| 2026-07-23 | $171.11 | −2.6% |
| 2026-07-22 | $175.63 | +1.2% |
| 2026-07-21 | $173.50 | +1.9% |
| 2026-07-20 | $170.32 | −0.8% |
| 2026-07-17 | $171.78 | +0.7% |
| 2026-07-16 | $170.61 | −4.1% |
| 2026-07-15 | $177.98 | −0.1% |
| 2026-07-14 | $178.10 | −3.2% |
| 2026-07-13 | $183.98 | −2.7% |
| 2026-07-10 | $189.16 | −1.0% |
| 2026-07-09 | $191.11 | +2.4% |
| 2026-07-08 | $186.56 | +2.0% |
| 2026-07-07 | $182.97 | −1.9% |
| 2026-07-06 | $186.48 | +5.8% |
| 2026-07-02 | $176.25 | −3.1% |
| 2026-07-01 | $181.92 | −1.6% |
| 2026-06-30 | $184.79 | −2.1% |
| 2026-06-29 | $188.72 | −0.4% |
| 2026-06-26 | $189.39 | −7.6% |
| 2026-06-25 | $204.90 | +3.8% |
| 2026-06-24 | $197.41 | −3.3% |
| 2026-06-23 | $204.13 | −8.0% |
| 2026-06-22 | $221.90 | −1.9% |
| 2026-06-18 | $226.11 | +6.2% |
| 2026-06-17 | $212.97 | −0.5% |
| 2026-06-16 | $214.07 | −3.1% |
| 2026-06-15 | $220.81 | +4.3% |
| 2026-06-12 | $211.72 | +4.3% |
| 2026-06-11 | $202.96 | +6.2% |
| 2026-06-10 | $191.20 | −6.9% |
| 2026-06-09 | $205.42 | −5.7% |
| 2026-06-08 | $217.77 | +0.8% |
| 2026-06-05 | $215.94 | −11.0% |
| 2026-06-04 | $242.57 | −3.0% |
| 2026-06-03 | $250.01 | +3.8% |
| 2026-06-02 | $240.84 | +5.2% |
| 2026-06-01 | $228.99 |
The chart ends at the Nov. 4 close of $173.19, before the results came out. Source: Tiingo end-of-day closes, as traded, via KeyVex.
How small the data-center business is today
Amon reaffirmed the target on Nov. 4.8-K Qualcomm's annual report doesn't give data center's own revenue. It reports the business with two other small units, its government unit and Modular, an AI software company it bought in July.10-K
Together those units brought in $476 million in fiscal 2026, up from $192 million a year earlier. They lost $607 million before taxes, against a $39 million loss the year before.10-K Qualcomm says $235 million of higher data-center revenue came primarily from its purchase of Alphawave IP Group, completed Dec. 18, 2025.10-K The target is more than 10 times what the whole group brought in, by KeyVex's math.Chart data
View the data
| Year | Revenue | Note |
|---|---|---|
| Fiscal 2025 (Data center and government units, actual) | $192M | <a class="kn-src" href="https://www.sec.gov/Archives/edgar/data/804328/000080432826000128/qcom-20260927.htm" target="_blank" rel="noopener" title="Qualcomm Form 10-K for fiscal 2026, segment note">10-K</a> |
| Fiscal 2026 (The same segments, with Modular from July, actual) | $476M | <a class="kn-src" href="https://www.sec.gov/Archives/edgar/data/804328/000080432826000128/qcom-20260927.htm" target="_blank" rel="noopener" title="Qualcomm Form 10-K for fiscal 2026, segment note">10-K</a> |
| Fiscal 2027 target (Data center alone, Qualcomm's target) | $5.0B | <a class="kn-src" href="https://www.sec.gov/Archives/edgar/data/804328/000080432826000127/qcom092726erex991.htm" target="_blank" rel="noopener" title="Qualcomm Form 8-K, Exhibit 99.1, Nov. 4, 2026: CEO statement">8-K</a> |
The fiscal 2025 and 2026 bars include units besides data center, so data center's own revenue was smaller. Sources: Qualcomm Form 10-K for fiscal 2026, segment note; Form 8-K, Exhibit 99.1, Nov. 4, 2026.
Starting with the December quarter, Qualcomm will report data center inside its chip business.10-K By the end of fiscal 2027, data center should be selling at a pace of about $7 billion a year, finance chief Akash Palkhiwala said on the call.Call
Where the $5 billion is to come from
Most of the $5 billion is to come from two cloud computing customers, one of them Amazon, Amon said.Call Most of it is custom chips for those customers' main AI processors, Palkhiwala said.Call
On Sept. 3, Qualcomm gave an Amazon affiliate a warrant, a right to buy Qualcomm shares at a fixed price. It came with a deal for Amazon to buy Qualcomm server chips and services.8-K
The Warrant Shares vest in tranches tied to the execution of certain commercial arrangements, the placement of binding purchase orders and actual purchases of QTI's server chip products, technology, systems and manufacturing services by Amazon during the term of the Warrant, up to a maximum amount of $60 billion in payments
The warrant covers up to 25 million shares at $161.26 each and expires on Sept. 3, 2036. Of those shares, 3.75 million vested when it was issued, based on Amazon's first purchase commitments. The rest vest as Amazon signs deals, places orders and buys, up to $60 billion of payments.8-K
Qualcomm valued the warrant at $1.8 billion, or $71.57 a share. It records that value as a reduction to revenue as Amazon's purchases are counted, its annual report says.10-K By KeyVex's reading, as Amazon's purchases are counted, more of that $1.8 billion comes off Qualcomm's reported revenue, up to the warrant's full value.10-K On Oct. 2, Qualcomm registered the warrant shares so the Amazon affiliate can sell them in the market. Qualcomm gets nothing from those sales.S-3
What the rest of the chip business did
For the full year, phone-chip sales fell 13%, to $24.1 billion, while car chips rose 52%, to $6.0 billion.8-K Total revenue fell 3%, to $43.1 billion.8-K
Phone chips shrank as car chips grew, fiscal 2025 to 2026Show chartHide chart
View the data
| Market | Fiscal 2025 | Fiscal 2026 | Change |
|---|---|---|---|
| Handsets | $27,793M | $24,072M | -13% |
| IoT | $6,617M | $7,132M | +8% |
| Automotive | $3,957M | $6,004M | +52% |
IoT is Qualcomm's name for chips in connected devices other than phones and cars. Source: Qualcomm Form 8-K, Exhibit 99.1, Nov. 4, 2026.
Palkhiwala expects phone-chip sales to fall by a mid-single-digit percentage in the December quarter from the September quarter. Growth with Android phone makers, he said, is offset by "the continued ramp down in Apple product revenue."Call Growth of more than 60% outside phones "would more than offset the decline in Apple product revenue," he said.Call
Stacy Rasgon of Bernstein questioned Qualcomm's forecast of a flat-to-down phone market: "I'm just struggling a little bit with the handset outlook," he said.Call Joshua Buchalter of TD Cowen asked whether gross margins would keep falling as the data-center business grows. The custom chips add to the chip business's operating margin, Palkhiwala said, but lower its gross margin, the share of sales left after the cost of making the chips.Call
The first test is the December quarter, the first in which data center is counted inside the chip business: Qualcomm forecasts more than $650 million of data-center sales.Call10-K
What to watch
Qualcomm's first quarter of fiscal 2027, with data center inside the chip business. Its forecast: more than $650 million of data-center revenue.
The $5 billion data-center target, most of it from two cloud customers, and a pace of about $7 billion a year by the end, per Qualcomm.
Qualcomm's target of $15 billion of data-center revenue, Palkhiwala said on the call.
Amazon's warrant expires.
The paper trail
Qualcomm's SEC filings cited here, Sept. 8 through Nov. 4, with the time EDGAR accepted each one.
| Filed (ET) | Form | Filer | What it shows |
|---|---|---|---|
| Sept. 8, 9:00 a.m. | 8-K | Qualcomm | Item 3.02: the Amazon warrant, up to 25 million shares at $161.26, vesting with up to $60 billion in payments. |
| Oct. 2, 4:30 p.m. | S-3 | Qualcomm | Registers the resale of up to 25 million warrant shares by the Amazon affiliate. |
| Nov. 4, 4:03 p.m. | 8-K | Qualcomm | Fourth-quarter and fiscal 2026 results; handset chips down 26%; $5 billion data-center target reaffirmed. |
| Nov. 4, 4:04 p.m. | 10-K | Qualcomm | Annual report: Apple and Samsung at 22% and 20% of revenue; the data-center group's $476 million of revenue and $607 million loss; the warrant's $1.8 billion fair value. |
Related coverage
Sources
7 sources, 4 of them public records
Public records
- Qualcomm Inc., Form 10-K for the fiscal year ended Sept. 27, 2026SEC EDGAR · Nov. 4, 2026
- Qualcomm Inc., Form 8-K, Exhibit 99.1: fourth quarter and fiscal 2026 resultsSEC EDGAR · Nov. 4, 2026
- Qualcomm Inc., Form 8-K, Item 3.02: warrant issued to an Amazon affiliateSEC EDGAR · Sept. 8, 2026
- Qualcomm Inc., Form S-3: resale of up to 25,000,000 warrant sharesSEC EDGAR · Oct. 2, 2026
Reporting
- Qualcomm fiscal Q4 2026 earnings call transcriptTradingKey · Nov. 5, 2026 (call of Nov. 4)
Data
- End-of-day prices for QCOM, and SPY and QQQ on the chart (Tiingo), and the Nov. 5 IEX quoteKeyVex · through Nov. 5, 2026
- The chart's Filings layer: KeyVex's Congress trade, insider trade, Form 144, 8-K and lobbying records for QCOMKeyVex · through Nov. 4, 2026
How we got these numbers
- Prices are end-of-day closes as traded, not adjusted for dividends. The chart ends at the Nov. 4 close, before Qualcomm's results. The Nov. 5 price is a single IEX quote at 10:20 a.m. Eastern, compared with the Nov. 4 close. The Nasdaq 100 and S&P 500 lines follow QQQ and SPY, rebased to Qualcomm's close at the start of the range shown. The Filings switch shows the filing markers from KeyVex's Qualcomm page, a selection of filings, not every filing and not only those tied to this story.
- Qualcomm's annual report names Apple and Samsung as the only customers or licensees that each brought in 10% or more of fiscal 2026 revenue, and lists two unnamed customers at 22% and 20%. The 42% is their sum. They include both chip sales and patent licensing.
- Qualcomm does not report data center's revenue by itself for fiscal 2026. It sits in "nonreportable segments" with the QGOV government unit and Modular. Comparing the $5 billion fiscal 2027 target with that group's $476 million is KeyVex's math; data center alone brought in less than $476 million.
- Call remarks are from the transcript of the Nov. 4 call published by TradingKey. Qualcomm's fiscal 2026 ended Sept. 27, 2026.