Qualcomm Faces Margin Pressure From Rising Costs: Can it Recover?

Qualcomm is experiencing significant margin compression in its QCT business due to higher semiconductor input costs, weaker smartphone demand, and unfavorable product mix. The company expects QCT EBT margins to decline to 23-25% in Q4 fiscal 2026 from 26% in Q3, with fixed-price contracts delaying benefits from price increases. Apple-related revenue is expected to decline 50% sequentially, while competitors Intel and AMD are showing stronger performance in data center and AI segments.