QCOM · Earnings call · 2026Q3T · Full report

Gross Margin Drivers

QUALCOMM INC/DE · 2026-11-04 · Importance 52 · Surprise 42 · In source text

Qualcomm is implementing product price increases to reflect higher semiconductor input costs, with benefits beginning in fiscal Q2 2027 and the full benefit expected in the second half of fiscal 2027. Management said the price increases should return the baseline gross margin to the historical 40%–50% range, at its low end. Data center custom silicon is expected to be accretive to operating margins but dilutive to gross margins, lowering gross margin relative to that baseline framework. QCT gross margin guidance also reflects the addition of data center shipments and investments ahead of revenue ramp.

Key facts

• QUALCOMM INC/DE expected the full benefit of its product price increases to appear in QCT gross margins in the second half of fiscal 2027.
• QUALCOMM INC/DE expects custom silicon engagements to be accretive to QCT operating margins and dilutive to gross margins.
• QUALCOMM INC/DE said price increases would return its baseline gross margin to its historical 40% to 50% range, at the low end.
• QUALCOMM INC/DE said data center revenue is expected to be accretive to operating margins but dilutive to gross margins.

Impact estimates