FreeJune 16, 2026

Qualcomm Reports Fiscal Q2 2026 Results: Automotive Sets Record, Handset Revenue Declines as Memory Constraints Weigh

Qualcomm's second-quarter fiscal 2026 earnings release discloses $10.6 billion in total revenue, record QCT Automotive sales, a $5.7 billion one-time tax benefit, and third-quarter guidance reflecting continued pressure on handset volumes from Chinese customers.

Sourced from the primary SEC filing. 8-K filed April 29, 2026 · SEC EDGAR ↗

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Summary

Qualcomm Incorporated filed an 8-K on April 29, 2026, disclosing results for its fiscal second quarter ended March 29, 2026, in which total revenues declined 3% year-over-year to $10.6 billion on a GAAP basis while Non-GAAP diluted EPS fell 7% to $2.65. A $5.7 billion non-cash income tax benefit from the release of a deferred tax valuation allowance drove GAAP net income sharply higher to $7.4 billion, masking underlying pressure in the handset segment. The company issued third-quarter guidance that anticipates further sequential softness in QCT handset revenues tied to memory supply constraints affecting Chinese original equipment manufacturers.

Key metrics

Total Revenues (GAAP)

10,599USD m

-3%Q2 FY2026

Total revenues for the three months ended March 29, 2026, compared to $10,979 million in Q2 FY2025.

Total Revenues (Non-GAAP)

10,599USD m

-2%Q2 FY2026

Non-GAAP revenues exclude certain items; Q2 FY2025 Non-GAAP revenues were $10,836 million.

Earnings Before Taxes (GAAP)

2,232USD m

-28%Q2 FY2026

GAAP EBT declined significantly year-over-year; Q2 FY2025 was $3,105 million.

Earnings Before Taxes (Non-GAAP)

3,246USD m

-12%Q2 FY2026

Non-GAAP EBT excludes share-based compensation, QSI, and other items; Q2 FY2025 was $3,694 million.

Net Income (GAAP)

7,370USD m

+162%Q2 FY2026

GAAP net income includes a $5.7 billion income tax benefit from release of a valuation allowance; Q2 FY2025 was $2,812 million.

Net Income (Non-GAAP)

2,840USD m

-10%Q2 FY2026

Non-GAAP net income excludes the tax benefit and other items; Q2 FY2025 was $3,172 million.

Diluted EPS (GAAP)

6.88USD

+173%Q2 FY2026

GAAP diluted EPS elevated by $5.33 per share income tax benefit from valuation allowance release; Q2 FY2025 was $2.52.

Diluted EPS (Non-GAAP)

2.65USD

-7%Q2 FY2026

Non-GAAP diluted EPS excludes tax benefit and other items; Q2 FY2025 Non-GAAP was $2.85.

QCT Segment Revenues

9,076USD m

-4%Q2 FY2026

QCT (semiconductor) segment revenues; Q2 FY2025 was $9,469 million.

QCT Segment EBT

2,465USD m

-14%Q2 FY2026

QCT earnings before taxes; Q2 FY2025 was $2,857 million.

QCT EBT Margin

27%

-3 pointsQ2 FY2026

QCT EBT as a percentage of QCT revenues; Q2 FY2025 was 30%.

QTL Segment Revenues

1,382USD m

+5%Q2 FY2026

QTL (licensing) segment revenues; Q2 FY2025 was $1,319 million.

QTL Segment EBT

994USD m

+7%Q2 FY2026

QTL earnings before taxes; Q2 FY2025 was $929 million.

QTL EBT Margin

72%

+2 pointsQ2 FY2026

QTL EBT as a percentage of QTL revenues; Q2 FY2025 was 70%.

QCT Handset Revenues

6,024USD m

-13%Q2 FY2026

Handset revenues within QCT; Q2 FY2025 was $6,929 million.

QCT Automotive Revenues

1,326USD m

+38%Q2 FY2026

Record quarterly QCT Automotive revenues as disclosed by management; Q2 FY2025 was $959 million.

QCT IoT Revenues

1,726USD m

+9%Q2 FY2026

Internet of Things revenues within QCT; Q2 FY2025 was $1,581 million.

Combined QCT Automotive and IoT Revenue Growth

20%

Q2 FY2026

Year-over-year combined growth of QCT Automotive and IoT segments as cited by management in the filing.

Equipment and Services Revenues (GAAP)

9,060USD m

Q2 FY2026

Equipment and services line on the consolidated income statement; Q2 FY2025 was $9,359 million.

Licensing Revenues (GAAP)

1,539USD m

Q2 FY2026

Licensing revenue line on the consolidated income statement; Q2 FY2025 was $1,620 million.

Cost of Revenues (GAAP)

4,900USD m

Q2 FY2026

GAAP cost of revenues for the quarter; Q2 FY2025 was $4,937 million.

Research and Development Expenses (GAAP)

2,463USD m

Q2 FY2026

GAAP R&D expenses for the quarter; Q2 FY2025 was $2,216 million.

Selling, General and Administrative Expenses (GAAP)

898USD m

Q2 FY2026

GAAP SG&A expenses for the quarter; Q2 FY2025 was $706 million.

Operating Income (GAAP)

2,309USD m

Q2 FY2026

GAAP operating income for the quarter; Q2 FY2025 was $3,120 million.

Operating Income (Non-GAAP)

3,280USD m

Q2 FY2026

Non-GAAP operating income after excluding QSI, share-based compensation, and other items; Q2 FY2025 Non-GAAP was $3,687 million.

EBT as % of Revenues (GAAP)

21%

Q2 FY2026

GAAP EBT margin for the quarter; Q2 FY2025 GAAP EBT margin was 28%.

EBT as % of Revenues (Non-GAAP)

31%

Q2 FY2026

Non-GAAP EBT margin for the quarter; Q2 FY2025 Non-GAAP EBT margin was 34%.

Income Tax Benefit (GAAP)

5,138USD m

Q2 FY2026

Includes $5.7 billion benefit from release of valuation allowance on federal deferred tax assets; excluded from Non-GAAP metrics.

Valuation Allowance Release Tax Benefit

5,700USD m

Q2 FY2026

One-time income tax benefit per share of $5.33, excluded from Non-GAAP results, resulting from updated U.S. Treasury guidance on corporate alternative minimum tax.

Basic EPS (GAAP)

6.92USD

Q2 FY2026

GAAP basic EPS for the quarter; Q2 FY2025 was $2.55.

Diluted Shares Used in EPS Calculation

1,072USD m

Q2 FY2026

Weighted-average diluted shares outstanding; Q2 FY2025 was 1,115 million.

Total Revenues (GAAP) — Six Months

22,851USD m

H1 FY2026

Six-month GAAP revenues for the period ended March 29, 2026; H1 FY2025 was $22,649 million.

Net Income (GAAP) — Six Months

10,375USD m

H1 FY2026

Six-month GAAP net income; H1 FY2025 was $5,992 million.

Diluted EPS (GAAP) — Six Months

9.65USD

H1 FY2026

Six-month GAAP diluted EPS; H1 FY2025 was $5.36.

Net Cash from Operating Activities

7,414USD m

H1 FY2026

Six-month operating cash flow; H1 FY2025 was $7,141 million.

Capital Expenditures

1,082USD m

H1 FY2026

Six-month capital expenditures; H1 FY2025 was $491 million.

Cash Dividends Paid (Six Months)

1,895USD m

H1 FY2026

Total dividends paid over the first half of FY2026; H1 FY2025 was $1,880 million.

Share Repurchases (Six Months)

5,442USD m

H1 FY2026

Total repurchases and retirements of common stock in H1 FY2026; H1 FY2025 was $3,498 million.

Capital Returned to Stockholders (Q2)

3,700USD m

Q2 FY2026

Total capital returned in the quarter, comprising $945 million in dividends and $2.8 billion in share repurchases.

Dividends Per Share (Q2)

0.89USD

Q2 FY2026

Cash dividends paid per share in Q2 FY2026.

Shares Repurchased (Q2)

19USD m

Q2 FY2026

Number of common shares repurchased during Q2 FY2026.

Cash and Cash Equivalents

5,435USD m

Q2 FY2026

Balance sheet cash as of March 29, 2026; was $5,520 million at September 28, 2025.

Marketable Securities

4,364USD m

Q2 FY2026

Marketable securities as of March 29, 2026; was $4,635 million at September 28, 2025.

Inventories

7,368USD m

Q2 FY2026

Inventories as of March 29, 2026; was $6,526 million at September 28, 2025. Filing references memory supply constraints impacting handset OEM demand.

Total Assets

57,136USD m

Q2 FY2026

Total assets as of March 29, 2026; was $50,143 million at September 28, 2025.

Long-Term Debt

14,772USD m

Q2 FY2026

Long-term debt as of March 29, 2026; was $14,811 million at September 28, 2025.

Total Stockholders' Equity

27,278USD m

Q2 FY2026

Stockholders' equity as of March 29, 2026; was $21,206 million at September 28, 2025, increase largely driven by GAAP net income including tax benefit.

Deferred Tax Assets

5,968USD m

Q2 FY2026

Non-current deferred tax assets as of March 29, 2026; was $743 million at September 28, 2025, reflecting the valuation allowance release.

Goodwill

14,251USD m

Q2 FY2026

Goodwill as of March 29, 2026; was $11,358 million at September 28, 2025.

Non-GAAP Tax Rate

12.5%

Q2 FY2026

Fixed estimated Non-GAAP tax rate applied beginning Q1 FY2026 per the company's updated methodology.

Q3 FY2026 Revenue Guidance

9.2B - 10.0BUSD

Q3 FY2026 guidance

Management's forward-looking revenue estimate for the third fiscal quarter; actual results may differ materially.

Q3 FY2026 QCT Revenue Guidance

7.9B - 8.5BUSD

Q3 FY2026 guidance

Management's forward-looking QCT segment revenue estimate for Q3 FY2026.

Q3 FY2026 QTL Revenue Guidance

1.15B - 1.35BUSD

Q3 FY2026 guidance

Management's forward-looking QTL segment revenue estimate for Q3 FY2026.

Q3 FY2026 GAAP Diluted EPS Guidance

1.26 - 1.46USD

Q3 FY2026 guidance

Management's forward-looking GAAP diluted EPS estimate for Q3 FY2026.

Q3 FY2026 Non-GAAP Diluted EPS Guidance

2.10 - 2.30USD

Q3 FY2026 guidance

Management's forward-looking Non-GAAP diluted EPS estimate for Q3 FY2026.

New Share Repurchase Authorization

20,000USD m

New $20 billion share repurchase program announced; completed $5.4 billion in H1 FY2026.

Extracted from public filings. Figures are presented for educational purposes only.

What the Filing Says

Qualcomm's 8-K, filed April 29, 2026, contains Exhibit 99.1, the company's earnings press release for the fiscal second quarter ended March 29, 2026. The filing discloses quarterly revenues, segment results, a material one-time income tax item, capital return activity, and management's forward guidance for the fiscal third quarter ending in late June 2026.

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Second-Quarter Financial Summary

The headline figures below reflect both GAAP and Non-GAAP presentations as reported in the filing. Qualcomm uses Non-GAAP measures to strip out share-based compensation, acquisition-related charges, and certain tax items; GAAP figures for the current quarter are heavily influenced by a discrete tax event described separately below.

| Metric | Q2 FY2026 (GAAP) | Q2 FY2025 (GAAP) | Change | Q2 FY2026 (Non-GAAP) | Q2 FY2025 (Non-GAAP) | Change | |---|---|---|---|---|---|---| | Revenues | $10,599M | $10,979M | (3%) | $10,599M | $10,836M | (2%) | | Earnings Before Taxes | $2,232M | $3,105M | (28%) | $3,246M | $3,694M | (12%) | | Net Income | $7,370M | $2,812M | +162% | $2,840M | $3,172M | (10%) | | Diluted EPS | $6.88 | $2.52 | +173% | $2.65 | $2.85 | (7%) |

The divergence between GAAP and Non-GAAP net income is almost entirely attributable to a $5.7 billion income tax benefit — equal to $5.33 per diluted share — that is included in GAAP results but excluded from Non-GAAP metrics. On an underlying operating basis, as captured by the Non-GAAP figures, earnings declined year-over-year.

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The $5.7 Billion Tax Benefit: What It Is and Why It Matters

The filing explains that in the second quarter of fiscal 2026, Qualcomm recorded a $5.7 billion income tax benefit from the release of a valuation allowance that had been established in the fourth quarter of fiscal 2025. A valuation allowance is an accounting reserve against deferred tax assets when a company concludes it is more likely than not that those assets will not be realized. Qualcomm states it now expects to realize its existing federal deferred tax assets following additional guidance issued by the U.S. Department of Treasury and the Internal Revenue Service on the corporate alternative minimum tax (CAMT).

This benefit is non-cash and non-recurring in nature. The filing explicitly excludes it from Non-GAAP metrics. However, its release caused GAAP net income to rise to $7.4 billion from $2.8 billion in the prior-year period, and caused the GAAP diluted EPS to increase 173% to $6.88. Readers comparing GAAP earnings across periods should account for this distortion when evaluating the company's operational trajectory.

On the balance sheet, this event is visible in the deferred tax asset line, which expanded from $743 million at September 28, 2025 to $5,968 million at March 29, 2026.

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Segment Results

Qualcomm operates two reportable segments: QCT (Qualcomm CDMA Technologies — semiconductors and system software) and QTL (Qualcomm Technology Licensing).

| Segment | Q2 FY2026 Revenue | Q2 FY2025 Revenue | Change | Q2 FY2026 EBT | Q2 FY2025 EBT | EBT Margin | |---|---|---|---|---|---|---| | QCT | $9,076M | $9,469M | (4%) | $2,465M | $2,857M | 27% (vs. 30%) | | QTL | $1,382M | $1,319M | +5% | $994M | $929M | 72% (vs. 70%) |

QCT: Semiconductor Business

QCT revenues declined 4% year-over-year, with the breakdown across three reported verticals telling a mixed story:

| QCT Vertical | Q2 FY2026 | Q2 FY2025 | Change | |---|---|---|---| | Handsets | $6,024M | $6,929M | (13%) | | Automotive | $1,326M | $959M | +38% | | IoT (Internet of Things) | $1,726M | $1,581M | +9% | | Total QCT | $9,076M | $9,469M | (4%) |

Handsets remain the dominant revenue source but contracted 13% year-over-year. The filing and management commentary attribute pressure to a challenging memory supply environment that has dampened demand from certain handset OEMs.

Automotive revenues reached $1,326 million, described in the filing as a record quarterly result for QCT Automotive, growing 38% year-over-year.

IoT revenues grew 9% year-over-year to $1,726 million. The filing highlights that combined Automotive and IoT revenues grew 20% year-over-year, framing this as evidence of diversification beyond the handset market.

QCT's earnings before taxes margin compressed to 27% from 30% in the prior-year period, reflecting the revenue mix shift away from higher-margin handset volumes.

QTL: Licensing Business

The licensing segment grew 5% in revenue and 7% in EBT, with margins expanding to 72% from 70%. QTL's performance was comparatively stable and partially offset QCT's weakness.

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Capital Returns and Balance Sheet

Return of Capital

During the second quarter, Qualcomm returned $3.7 billion to stockholders: $945 million (or $0.89 per share) in cash dividends and approximately $2.8 billion through repurchases of 19 million shares. For the full first half of fiscal 2026, the company completed $5.4 billion in share repurchases.

The filing separately discloses that the board has authorized a new $20 billion share repurchase program, which would represent a substantial incremental authorization relative to historical repurchase levels.

The diluted share count fell to approximately 1,072 million in Q2 FY2026 from approximately 1,115 million in Q2 FY2025, reflecting the impact of sustained buyback activity.

Balance Sheet Highlights

| Item | March 29, 2026 | September 28, 2025 | |---|---|---| | Cash and Cash Equivalents | $5,435M | $5,520M | | Marketable Securities | $4,364M | $4,635M | | Inventories | $7,368M | $6,526M | | Goodwill | $14,251M | $11,358M | | Long-Term Debt | $14,772M | $14,811M | | Total Assets | $57,136M | $50,143M | | Total Stockholders' Equity | $27,278M | $21,206M |

Notable movements include a $842 million increase in inventories and a $2,893 million increase in goodwill — the latter suggesting acquisition activity during the period — alongside the large deferred tax asset addition described above. Long-term debt remained essentially flat at approximately $14.8 billion.

Cash Flow

For the six months ended March 29, 2026, Qualcomm generated $7,414 million in operating cash flow, up from $7,141 million in the comparable prior-year period. Capital expenditures increased meaningfully to $1,082 million from $491 million. The company used $5,442 million to repurchase shares and paid $1,895 million in dividends during the first half.

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Management Commentary and Strategic Positioning

CEO Cristiano Amon's statement in the filing frames the quarter as one of "solid execution" within a "challenging memory environment." Management highlighted two strategic themes:

1. AI agent transformation: Management stated that the rise of AI agents is reshaping the company's product roadmap "across every platform." 2. Data center entry: The filing discloses that Qualcomm has a "custom silicon engagement" with a "leading hyperscaler" that management said is "on track for initial shipments later this calendar year." The company announced an Investor Day scheduled for June 24, 2026, where it said it would provide updates on Data Center and Physical AI opportunities.

These are forward-looking statements, and the filing's risk factors note material uncertainties around Qualcomm's ability to extend its technologies into new markets.

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Third-Quarter Fiscal 2026 Guidance

The following guidance is as disclosed by management in the filing. It is forward-looking, and actual results may differ materially.

| Metric | Q3 FY2026 Guidance Range | |---|---| | Total Revenues | $9.2B – $10.0B | | QCT Revenues | $7.9B – $8.5B | | QTL Revenues | $1.15B – $1.35B | | GAAP Diluted EPS | $1.26 – $1.46 | | Non-GAAP Diluted EPS | $2.10 – $2.30 |

Management stated that Q3 guidance incorporates "the estimated impact of memory supply constraints and related pricing on demand from several handset OEMs." More specifically, the filing states that management now estimates QCT handset revenues from Chinese customers will reach a bottom in the third quarter and return to sequential growth in the following quarter. This implies further year-over-year pressure on the handset segment before an anticipated recovery.

The Q3 revenue guidance midpoint of $9.6 billion represents a sequential decline from the $10.6 billion reported in Q2, which is consistent with the pattern described above.

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Risks the Company Discloses

The filing's forward-looking statements section identifies a range of risk factors that readers should be aware of, as disclosed by management:

Customer concentration: Dependence on a small number of customers and licensees, particularly for premium-tier handsets.
China exposure: A significant portion of business is concentrated in China, a risk described as "exacerbated by U.S./China trade and national security tensions." The Q3 guidance explicitly references pressure from Chinese handset OEM customers.
Customer vertical integration: Risk that customers may increasingly develop their own chips, reducing reliance on Qualcomm.
Licensing business continuity: Ongoing need to renew or renegotiate expiring license agreements and defend against challenges to the licensing model.
Market diversification execution: Uncertainty around the company's ability to extend its technology into automotive, IoT, data center, and other markets beyond mobile handsets.
Semiconductor cyclicality: The inherent cyclical nature of the semiconductor industry.
Geopolitical and macroeconomic risk: Exposure to geopolitical conflicts, trade policy changes, and broader economic conditions.
Memory environment: As explicitly flagged in Q3 guidance, memory supply constraints are impacting handset OEM demand patterns.

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Summary of Key Takeaways from the Filing

Total revenues of $10.6 billion fell 3% year-over-year (GAAP) and 2% (Non-GAAP), with the decline driven by a 13% drop in QCT Handset revenues.
A $5.7 billion non-cash GAAP tax benefit significantly elevated reported net income and EPS; Non-GAAP EPS declined 7% to $2.65.
Automotive revenues hit a quarterly record at $1,326 million (+38% YoY); combined Automotive and IoT grew 20% YoY.
QTL licensing revenues grew 5% and continued to carry high margins at 72%.
The company completed $5.4 billion in share repurchases in the first half of fiscal 2026 and announced a new $20 billion authorization.
Q3 FY2026 guidance implies continued sequential revenue decline, with management citing memory-related demand pressure from Chinese handset OEMs as the primary factor.
Management flagged a hyperscaler custom silicon engagement on track for initial shipments later in calendar 2026, with a formal strategic update planned for Investor Day on June 24, 2026.

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*Silicon Signal publishes general, impersonal market commentary. Nothing in this article constitutes investment advice or a recommendation to buy, sell, or hold any security. All figures and statements are sourced directly from Qualcomm's 8-K filing dated April 29, 2026, and attributed accordingly.*

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