Qualcomm PT Slashed to $140 on Rising DRAM, NAND Costs and Weak iPhone Demand
Bernstein downgraded Qualcomm to Market-Perform from Outperform, cutting its price target to $140 from $175 due to rising mobile DRAM and NAND costs and predicted double-digit smartphone unit declines. Analyst warns Apple modem revenue could fall from 80% to 20%, while $1.50 licensing EPS faces volatility ahead of April 2027 expiration.
1. Analyst Downgrade and Price Target Cut
Bernstein downgraded Qualcomm to Market-Perform from Outperform and lowered its price target to $140 from $175. The firm cited sharp increases in mobile DRAM and NAND costs as a major headwind expected to drive double-digit declines in smartphone unit shipments this year.
2. Smartphone and Apple Risks
The analyst warned that Apple’s modem business share could decline from around 80% to roughly 20% by year-end, creating a significant revenue drag. He also noted that the $1.50 per-share contribution from Apple licensing faces potential volatility ahead of its April 2027 expiration.
3. Limited Upside Catalysts
Qualcomm’s announced $20 billion stock buyback program and planned data-center technology event are unlikely to offset the broader industry pressures, especially as investors favor chipmakers tied to artificial intelligence workloads trading below 15 times earnings.