Qualcomm (QCOM) has experienced a significant surge in its stock price, climbing 11.12% on Friday to close at $148.85. This rally comes as investors prepare for the company’s Q2 fiscal 2026 earnings report, which is set to be released after the market closes on April 29.
The recent uptick in QCOM’s stock has reignited interest from investors following a challenging start to 2026. Despite this week’s gains, the stock still reflects a downward trajectory of approximately 13% year-to-date, having reached a high of $205.95 and a low of $121.99 in the past year.
For the upcoming quarter, Qualcomm has issued revenue guidance ranging from $10.2 billion to $11 billion, signaling a flattening or potential decline of up to 7% compared to last year’s revenue of $10.98 billion for the same period. Furthermore, the company projects GAAP diluted earnings per share (EPS) between $1.69 and $1.89, a decrease compared to $2.52 a year prior.
Notably, there was a surge in options activity on Friday, with approximately 120,444 call contracts traded—an impressive 165% above the daily average. This indicates strong bullish sentiment among investors leading into the earnings announcement.
Boosted by Semiconductor Market Strength
Much of Friday’s rise can be attributed to broader positive trends in the semiconductor industry. Recent data from the Semiconductor Industry Association reveals that global chip sales soared to $88.8 billion in February, marking a 61.8% increase over the same month last year and a 7.6% rise from January 2026.
According to SIA President John Neuffer, robust sales into the Asia-Pacific region, the Americas, and China were pivotal in driving this growth. He also noted that annual global chip sales are expected to approach $1 trillion in 2026.
Qualcomm has garnered attention recently for its potential in the AI sector, with the company aiming to capitalize on the growing “AI at the edge” paradigm that extends beyond its traditional smartphone focus. However, challenges still loom on the horizon, as analysts cite weaknesses in smartphone demand and increasing memory costs as possible impediments. In fact, Morgan Stanley has adopted an underweight stance with a $132 price target, while Sanford C. Bernstein anticipates a market performance with a $140 target.
Conversely, optimistic positions have been staked by Piper Sandler, who rates Qualcomm as overweight with a $200 target, and Rosenblatt, which continues to advocate for a buy, adjusting their target to $190.
Return of Buybacks and Higher Dividends
In March, Qualcomm’s board of directors authorized a substantial share repurchase program worth $20 billion, allowing for the buyback of as much as 14.5% of outstanding shares. Alongside this, the quarterly dividend has been increased from $0.89 to $0.92, which will be payable on June 25 to shareholders on record as of June 4, resulting in an annualized dividend of $3.68 and a yield of 2.5%.
In its Q1 earnings report, Qualcomm posted a robust EPS of $3.50, surpassing the consensus estimate of $3.38, with revenue amounting to $12.25 billion, which also exceeded expectations slightly at $12.16 billion. The company maintains a strong return on equity of 44.09%.
Institutional ownership of Qualcomm is at 74.35%, with Concurrent Investment Advisors notably increasing its stake by 66.2% in Q4, acquiring an additional 35,166 shares, totaling 88,257 shares held.
In the realm of insider trading, two executive vice presidents sold a combined 6,533 shares in early February at prices between $137 and $137.65. Over the past three months, total insider sales amounted to 9,118 shares, valued at approximately $1.23 million.
Despite the volatility and challenges, analysts currently rate Qualcomm as a Hold, with an average price target of $158.25 set for the upcoming quarter. Guidance for Q2 EPS has been established in the range of $2.45 to $2.65.
