Qualcomm beat on fiscal Q1 revenue of $12.3 billion and EPS of $2.78, topping estimates, but issued cautious Q2 guidance with revenue between $10.2 billion and $11 billion and adjusted EPS of $2.45 to $2.65 due to ongoing memory supply constraints.

QCT posted $10.6 billion in revenue, led by a record $7.8 billion in handset revenue, with IoT and automotive seeing growth and QTL delivering $1.6 billion at a 77% EBITDA margin.

Management warned near-term weakness in the handset line from memory shortages affecting production, contributing to conservative guidance.

Executives cited near-term uncertainty in memory supply and pricing amid strong AI memory demand, plus OEMs in China trimming handset build plans and channel inventory.

CEO Cristiano Amon stressed that premium handset demand remains strong and reaffirmed Qualcomm’s long-term FY2029 revenue goals despite short-term headwinds.

Strategic momentum includes multiple AI and data-center initiatives, with acquisitions of Alpha Wave SEMI and Ventana Micro Systems to bolster AI compute and RISC-V capabilities, and broader Robot/IoT expansion.

Qualcomm also highlighted design wins and partnerships across automotive and industrial sectors, including a long-term infotainment supply agreement with Volkswagen and ongoing robotics and IoT initiatives.

In the quarter, Qualcomm returned about $3.6 billion to shareholders through $2.6 billion in buybacks and $949 million in dividends.

Broad earnings context noted ongoing AI-driven demand and continued capital expenditure in tech, shaping expectations for the sector.

Analyst Q&A emphasized memory constraints as the main driver of near-term handset weakness, with continued automotive momentum and data center traction from humane and hyperscaler engagements.

Qualcomm plans to develop AI chips (AI200, AI250) to compete in AI compute markets alongside AMD and NVIDIA.

Analysts expected stronger Q2 results than guided, reflecting the memory supply constraints impacting handset and margins.