A：For the second quarter fiscal 2026, Qualcomm reported revenues of $11.0 billion, which were at the high end of their guidance. QCT revenues were $9.1 billion, with record automotive revenues and growth in IoT licensing business revenues at $1.400 billion.

A：The emergence of AI workloads is fundamentally changing the semiconductor industry by reshaping design cycles and creating opportunities for new functionalities in connected devices. These workloads require continuous background operation, data fusion, reliable orchestration of tasks, and strong security features, which represent a significant upgrade opportunity and expansion of the addressable market.

A：In the automotive sector, Qualcomm is projected to exceed $500 billion in annualized revenues and is expected to exit fiscal 26 at a run rate above $6 billion. This growth is attributed to the fourth-generation Snapdragon Digital Chassis platform and is expected to continue with the upcoming fifth-generation platform, which will deliver substantial performance enhancements and support level II and level Ed autonomous driving.

A：Personal AI is anticipated to see a significant increase in the choice of newest smart glasses starting in the second half of the year, catalyzed by rapid progress in agent AI. New products contributing to this area include the 2026 Snapdragon X 2 PC platforms and the world-class Orion CPU, which provide powerful performance on a single device and are designed to be competitive differentiators.

A：The multi-year agreement with Neura is significant for Qualcomm as it reinforces the company's confidence in its potential to become a major player in the broad robotics market. This agreement underlines the growing interest and confidence in Qualcomm's technology among industry partners.

A：Qualcomm is expanding its presence in the industrial AI market by moving new products from design wins to deployment across various verticals such as retail, utilities, oil and gas, agriculture, and data centers. They are also ramping up custom silicon solutions, starting with a leading hyperscale partner, and expect initial shipments in the December quarter. Additionally, development of their leading data center CPU and high-performance AI inference accelerators is progressing well.

A：The key points to consider regarding the company's chip business performance include the resilience of the sell-through in the chip business, the material under shipment of consumer demand, and the belief that the bottoming out of China Android revenue is underway. The company anticipates a strong influence of AI on the premium tier in the coming fiscal year, supported by examples like the pynk Taobao powered AI phone from ZTE Nubia and the miclas agent framework announced by Xiaomi.

A：The company is positioned to benefit from the development of 6G technology through its leadership in connectivity, AI processing, and high-performance low-power computing. It is one of the key architects and beneficiaries of the 6G revolution, developing foundational technologies and standards as well as end-to-end solutions for devices in the network, from modems and compute platforms that power phones, PCs, intelligent wearables, and cars to the network infrastructure including power-efficient next-generation RAN units, wide area network sensing platforms, and high-performance AI accelerators for the RAN network, edge core, and data center.

A：The impact of memory industry dynamics on the company's business in the second fiscal quarter was the reduction in China QCT Android shipments due to the increase in demand for memory in AI data centers, resulting in uncertainty in memory supply and price increases. This led to a cautious approach by the handset Oems, particularly in China, which reduced build plans and drew down channel inventory, causing QCT Android shipments to be significantly below the scale of end consumer handset demand.

A：The company's guidance for the third fiscal quarter is a revenue forecast of $9.2 to 10 billion dollars and non GAAP EPS of $2.10 to $2.30 dollars. In QTL, revenues are estimated to be between $1.15 to $1.35 billion with an EBT margin of 67% to 71%. For QCT, revenues are expected to be between $7.9 to $8.5 billion with EBITDA margins of 25% to 27%. The company anticipates QCT handset revenues to be flat as a result of industry-wide memory dynamics and expects QCT IoT revenues to grow by high single digits. In QC Automotive, revenue growth is expected to accelerate to approximately 50% year over year.

A：The group has developed capabilities for custom AEC, added a solution for memory in the accelerator, and is pursuing custom AAC. They have an engagement with multiple companies, including work with large hyperscalers and are considering a multi-generation approach.

A：The group is confident in the fiscal third quarter as the bottom for Android sales due to the observed market dynamics and visibility from their licensing business. They have seen small declines in the handset market scale and significant undershipping of consumer demand in the March quarter and guidance for the June quarter due to channel inventory drawdown. Looking forward, they expect the third quarter to be the bottom, with revenue more closely aligned with the scale of the business rather than inventory adjustments.

A：The group views the competitive landscape in the data center opportunity as evolving. Initially, the focus was on training AI with GPUs, then shifting to using GPUs for inference at scale, and now seeing the emergence of dedicated solutions making the data center more disaggregated. They are entering a new phase where AI is generating demand for tokens used in various devices, and they believe their IP, particularly the CPU, and their ability to provide custom silicon and combine IP, give them a competitive advantage.

A：The relationship with the primary premium smartphone customer, Samsung, has seen a reset in the framework of their business relationship. Historically, there was a business involving Samsung's in-house silicon, but now the framework is greater than expected, and the group plans their business with a script share in mind. This new framework also applies to the coming year. Despite market changes and increased use of in-house SOCs, the group feels confident in their position on Snapdragon and may have a positive bias on market share due to recent events.

A：The engagement with hyperscalers for the December quarter involves a custom product that is targeted at local hyperscalers.

A：QTL is expected to be modestly down, and its performance is influenced by the continuing strength of the premium high tier of the market and the weakness in the lower tiers, as indicated by the company's guidance and actual results.

A：Handset revenues for Chinese Oems are expected to bottom in the June quarter and see sequential growth from there. For Apple, it is a typical growth quarter, but due to a change in share assumptions, it is not expected to grow at this point.

A：There is no specific guidance on sequential growth for handsets in the September quarter; however, the factors mentioned are inputs to consider in forecasting the quarter.

A：It's still early to discuss the specific impact of AI and agnostic devices on memory requirements in the future, but there is a change in device requirements and a scaling of AI. The nature of device designs is shifting towards ones that can better accommodate AI, which implies a potential need for more capable CPUs and potentially higher memory requirements. However, the situation will need to be monitored, especially regarding new players entering the market and building capacity.

A：The development of the custom product for the fourth quarter involves a team from Alpha Wave and includes chiplet and custom DSP elements. This is a significant development that is expected to leverage a lot of Qualcomm capabilities, although specific details will be provided in due course as part of the company's roadmap and customer wins.

A：The assumption remains the same that about 20% of the new phone launches in the fall will be Apple products, and this is consistent with previous years. The expected Apple product revenue for fiscal year Ly is in the range of a little over $30 billion, which is considered a reasonable model for the business.

A：Manufacturers are allocating more memory to premium and high-tier products due to their higher profitability, which is a logical choice. This trend is reflected in the market, influencing the product mix moving forward.

A：Qualcomm expects 6G to feel very different from previous generations and to present interesting opportunities in sovereign AI and data centers. They anticipate prototype demonstrations by 2028, with the possibility of first silicon in Ed, and early launches following that.

A：The total handset market saw a slight decline in mid-low Ti, but the overall scale remained steady in the March quarter. The shipment size to Chinese customers is affected by the drawdown of channel inventory, which is expected to end soon, allowing shipments to reconcile with the actual size of the handset market.

A：The ramp of the ADAS business is expected to accelerate revenue significantly due to increased silicon content. This is not only because of the shift from cockpit to ADAS mix but also from generation 4 to 5 in digital cockpit, which brings a step-function increase in capability. There is an expectation for more computing power, especially as they add processors and develop L2+ towards level 3. For gross margin, the increase in silicon sales through modules and the addition of software opportunities are expected to improve the margin profile.

A：Pending renegotiation, the royalty contribution is not expected to change and will remain at the current scale. It is treated as an independent business separate from the chip business.

A：Qualcomm intends to enter the data center market with a flexible approach, playing both as a merchant and a custom solutions provider. They plan to disaggregate different compute and connectivity needs and expect the custom engagements to be accretive at the operating margin level.