Qualcomm Seen as No-Brainer AI Chip Stock Despite Near-Term Headwinds

Chipmaker's long-term potential outweighs short-term smartphone industry pressures, say analysts.

Published on Feb. 11, 2026

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Despite a disappointing outlook for the next year due to smartphone industry challenges, Qualcomm looks like a no-brainer buy for patient investors who can withstand near-term financial pressure, according to analysts. The chipmaker's diversification into automotive, IoT, and data center AI chips is expected to offset smartphone headwinds and position it well for long-term growth as AI inference moves to devices.

Why it matters

Qualcomm's position as a leading provider of mobile processors and wireless chipsets makes it well-placed to capitalize on the growing demand for on-device AI capabilities. While short-term smartphone industry pressures will impact the company's revenue, its long-term outlook remains strong as it expands into new high-growth markets.

The details

Qualcomm generates the majority of its revenue from wireless handsets, but the smartphone industry is facing pressure due to rising memory chip costs. This has led to a decline in smartphone volume, pushing Qualcomm's revenue lower. However, the company has worked to diversify beyond smartphones, with its automotive and IoT segments continuing to grow quickly. Qualcomm is also pushing into the data center chip business with new AI inference chips, which could be a meaningful growth driver in the coming years.

  • Qualcomm warned that smartphone volume will decline this year, pushing its revenue lower.
  • Memory chip supply is expected to remain tight through the end of calendar 2026, putting pressure on Qualcomm's revenue through the middle of its fiscal 2027.
  • Qualcomm maintained its 2029 revenue outlook, indicating the long-term potential for the stock remains intact.

The players

Qualcomm

A leading semiconductor company that designs and manufactures wireless chipsets and mobile processors, including for 5G and AI applications.

Micron

A major memory chip manufacturer that expects supply to remain tight through the end of 2026, impacting Qualcomm's revenue.

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What they’re saying

“The growing demand for artificial intelligence compute has created an interesting challenge for Qualcomm.”

— Adam Levy, Author (yahoo.com)

“Importantly, management expects the setback in smartphone production to be a temporary headwind. It maintained its 2029 revenue outlook, which means the long-term potential for the stock remains intact.”

— Adam Levy, Author (yahoo.com)

What’s next

Qualcomm's performance in the data center chip business and its ability to offset smartphone industry pressures with growth in automotive and IoT segments will be key to watch in the coming years.

The takeaway

Despite near-term headwinds, Qualcomm's long-term potential as a leading provider of mobile processors and wireless chipsets, including for AI applications, makes it a compelling investment opportunity for patient investors willing to weather the current industry challenges.