$QCOM: Earnings Beat Despite Apple Risk — But Settlement Overhang Still Persists

Court: S.D. California

Case: 3:17-cv-00121

Qualcomm QCOM delivered stronger-than-expected quarterly earnings, reporting $10.9B in revenue and adjusted EPS of $2.85, both above consensus estimates. The company also issued guidance in line with Wall Street forecasts, but shares slipped 6% in after-hours trading as investors remain cautious over its looming split from Apple and macro tariff risks. While Qualcomm pushes ahead with diversification into PCs and IoT, the legal shadow of its prior settlement tied to anticompetitive practices continues to weigh on investor sentiment.

Key Highlights

• Revenue: $10.9B (+17% YoY), beating expectations of $10.6B.
• EPS: $2.85, slightly above analyst forecast of $2.82.
• Guidance: Next quarter revenue outlook between $9.9B–$10.7B, EPS range $2.60–$2.80.
• Stock Reaction: Closed up 1% at $148.46, but fell nearly 6% after-hours.
• Apple Risk: Analysts expect Apple to switch away from Qualcomm’s modems in H2 2025.
• Diversification: Ongoing push into PCs and IoT, though analysts warn returns will take time.

• Timeline OverviewJan 17, 2017 — FTC filed complaint against Qualcomm over licensing practices.Jan 18, 2017 — Media reports revealed overcharging and exclusivity deals.Jan 19, 2017 — QCOM dropped 18.3% on the news.Jan 23, 2017 — Investors filed lawsuit.
• Allegations IncludeOvercharging for chip licenses.Refusing sales to manufacturers rejecting Qualcomm’s terms.Providing reduced royalties to Apple in exchange for exclusivity.Violating FRAND obligations on patent licensing.
• Investor UpdateSettlement resolved claims tied to anticompetitive practices and weak reporting controls.Closed the litigation but highlighted compliance and antitrust exposure.Investors remain wary of governance risks even as Qualcomm executes on diversification strategy.

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