This QCOM Stock Forecast article was written by Rain Liu – Financial Analyst at I Know First.

Highlights

• QCOM Q3 FY2025 revenue surged 10.4% YoY, led by automotive and IoT growth.
• $2.4B Alphawave acquisition and ARM-based data center push fuel AI and connected device expansion.
• Attractive valuation with $3.8B returned to shareholders signals strong financial health.

Business Stage

Based on the financial reports for the third quarter of fiscal year 2025, QCOM has demonstrated a robust financial performance, signaling strong growth and strategic execution. 

As of August 2025, Qualcomm is actively transitioning from its traditional focus on mobile chipsets to a diversified technology company. In its fiscal Q3 2025, Qualcomm reported $10.37 billion in revenue, marking a 10.4% year-over-year increase, with significant growth in automotive and IoT sectors. The company announced a $2.4 billion acquisition of Alphawave IP Group, a UK-based provider of high-speed connectivity and compute technologies, to enhance its AI and data center capabilities. Additionally, Qualcomm is re-entering the data center market with ARM-based CPUs designed to integrate with NVIDIA’s AI infrastructure, aiming to capitalize on the growing demand for AI workloads. These strategic moves underscore Qualcomm’s commitment to expanding its presence in high-growth markets and positioning itself for long-term value creation.

Financial performance

Based on the Form 10-Q, in Q3 FY2025, QCOM delivered strong growth. Total revenue rose 10% to 10.4 billion dollars, with GAAP EPS up 29% to 2.43 dollars and non-GAAP EPS up 19% to 2.77 dollars. 

Growth was led by the QCT segment, which increased 11% to 9.0 billion dollars, driven by Handsets up 7%, Automotive up 21% with a record quarter, and IoT up 24%. Automotive and IoT together grew 23%, highlighting successful diversification. QCT earnings before tax rose 22%, reflecting strong operational leverage and margin expansion.

The graph provides a detailed breakdown of Qualcomm’s QCT revenue streams. It clearly shows the growth across all segments from Q3 FY2024 to Q3 FY2025. Handset revenues increased from $5,899 million to $6,328 million, Automotive revenues jumped from $811 million to $984 million, and IoT revenues grew from $1,359 million to $1,681 million. The most significant percentage growth is observed in the Automotive and IoT segments, reinforcing Qualcomm’s successful diversification strategy and reduced reliance on the traditional handset market. The revised chart now features lighter colors and no outlines, and the top and right borders have been removed for improved visual clarity.

Qualcomm’s commitment to capital returns remains a key pillar of its value proposition. In the third quarter of fiscal 2025 alone, the company returned $3.8 billion to stockholders, consisting of $2.8 billion in share repurchases and nearly $1 billion in dividends. This significant return of capital demonstrates the company’s strong financial health and its dedication to shareholder value.

The Altman Z-score, which determines the result of a credit test, stays in the Safe zone. At the same time, QCOM looks interesting in terms of the Piotroski F-Score. Piotroski F-score is a number between 0 and 9 that is used to assess the soundness of a company’s financial position. A score of 7 may indicate that the company’s financial situation is a very healthy situation.

QCOM Stock Forecast: Competitive Positioning

QCOM appears undervalued, trading at a P/E of 15.25 versus the peer median of 50.92, signaling potential earnings upside. Its price-to-sales ratio of 4.04 matches MU but lags high-growth peers ARM and ADI, while the price-to-book ratio of 6.30 sits above MU and INTC but below ARM, reflecting moderate market confidence. The price-to-cash-flow of 13.43, well below the peer median of 29.09, highlights strong cash generation.

Forward revenue growth of 7.47% exceeds the peer median of 5.50% but trails high-growth peers MU at 45.99% and ARM at 21.41%. QCOM’s stable growth is driven by its core mobile and licensing businesses, with automotive, AI, and IoT offering additional upside potential. 

Viewpoints from Analyst Community

Based on data sourced from Yahoo Finance, the overwhelming majority of analysts rated the stock as Hold (50%) and 33% as Buy with the average price target is $176.68.

QCOM Stock Forecast: Conclusion

Given the analyst consensus and the company’s proven ability to execute, QCOM stock presents a compelling investment case, positioned for both stable, long-term appreciation and the potential for transformative upside.

It is worth paying attention that the stock-picking AI of I Know First has a high signal on the one-year market trend forecasts, supporting my position for the QCOM stock forecast. The light green for the short-term forecasts is mildly bullish, while the darker green is a strong bullish signal for the one-year forecast.

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Please note-for trading decisions use the most recent forecast.