What changed
$QCOM — Designs and supplies semiconductors and telecommunications equipment.
🎯 Q1 FY26 | Rev $11B | EPS $2.65 vs $2.56 🟢 | Margin 21.8%
💡 Consensus expected EPS of $2.56; reported $2.65, a 3.58% beat. However, the beat was entirely driven by a $5.7B tax benefit ($5.33/share) from releasing a valuation allowance. Excluding this, core EPS was negative. Revenue fell 3.5% YoY, operating income dropped 26%, and R&D spending rose 11%.
🏢 Business Quality: 6/10 | Valuation: fair
📉 Reward/Risk: Upside 10% (to $211) vs downside 20% (to $154) = 0.5:1
🔮 Catalyst: Next quarterly report (late July 2026). Watch: core EPS ex-tax items, revenue growth, and operating margin. Failure signal: further revenue decline or margin compression.
💰 Entry: Current price $192.11 is not attractive given the one-time nature of the earnings beat and deteriorating fundamentals.
Also in play: $AVGO $MRVL $NXPI $TXN $INTC $TSM