Cristiano Amon's Qualcomm slid after hours as handset chip sales fell 26%, while Arm slipped and AppLovin jumped

Chip stocks had a rough regular session on Wednesday, and the after-hours reports did not change that much. Qualcomm and Arm, two of the biggest names in smartphone chips, both beat Wall Street's estimates and both fell in extended trading. The standout of the evening was outside chips altogether: AppLovin, the mobile advertising company, jumped after a strong forecast.

Qualcomm: a beat with a soft spot

Qualcomm reported adjusted earnings of $2.17 a share for its fiscal fourth quarter, against the $2.16 analysts expected, according to CNBC, which cited LSEG. Adjusted revenue was $10.44 billion. Investing.com put the revenue consensus at $10.12 billion.

The weak spot was the business that still makes up most of the company. Revenue from handset chips fell 26% to $5.14 billion, Reuters and CNBC reported, short of analysts' estimates of $5.21 billion to $5.25 billion depending on the survey. Reuters said rising memory chip prices, driven by demand for AI servers, have pushed up the cost of phones and hurt demand, and that global smartphone shipments fell 20% in the September quarter to a 14-year low, according to Counterpoint Research.

Other parts of the business grew quickly. Automotive revenue rose 89% to a record $1.99 billion, according to Investing.com and the company's statement as reported by 24/7 Wall St. Amon said combined automotive and internet-of-things revenue grew 36% from a year earlier.

"We don't have a demand issue; it's a supply issue." - Cristiano Amon, Qualcomm CEO, on the data center business, as quoted by CNBC

The forecast

For the current quarter, Qualcomm forecast revenue of $10.4 billion to $11.2 billion and adjusted earnings of $2.15 to $2.35 a share, CNBC reported. The revenue midpoint is above the $10.48 billion analysts expected, but the earnings midpoint is below the $2.27 consensus. Investing.com said the company flagged rising costs across wafer manufacturing, packaging, memory and other inputs, and expects price increases to bring their full benefit in the second half of fiscal 2027.

Amon told Reuters that Android handset sales had bottomed and were ticking higher, and that the forecast includes no further sales to Apple, which is switching to its own modem chips.

"Unlike some other companies, we called this memory thing early, and we said we prepared for it." - Cristiano Amon, to Reuters

He also reiterated a target of $5 billion in data center revenue in fiscal 2027, CNBC reported, after $650 million in the quarter, and said non-handset revenue is projected to grow by more than 60%. The stock had risen 5.33% to $173.19 in the regular session, according to Yahoo Finance data, before falling about 6% after hours, CNBC said. Reuters put the decline at more than 6%.

Arm beats and slips

Arm reported adjusted earnings of 52 cents a share on revenue of $1.44 billion for its fiscal second quarter, above estimates of 47 cents and $1.38 billion, Investing.com and Quartz reported. Revenue rose 27%, a record for the period, with license revenue up 50% and royalties up 8%, Quartz said.

Its forecast was closer to expectations. Arm guided third-quarter revenue to about $1.54 billion, plus or minus $50 million, against a $1.53 billion consensus, and adjusted earnings to 56 cents a share, plus or minus 4 cents, against 55 cents. Its U.S.-listed shares fell nearly 4% after hours, Investing.com reported.

AppLovin surges

AppLovin had the strongest after-hours reaction among the larger reports. The company earned $4.30 a share in the third quarter against a $4.04 estimate, on revenue of $2.18 billion against $2.08 billion expected, Investing.com and StreetInsider reported. It forecast fourth-quarter revenue of $2.37 billion to $2.40 billion, well above the $2.25 billion consensus, and raised its buyback authorization by $3.2 billion.

The shares had already risen 10.69% to $271.75 in the regular session, according to Yahoo Finance data. After hours they gained about 16% according to Investing.com and 21% according to StreetInsider. Extended-hours trading is thin, so those moves can change before Thursday's open. TIKR noted that the stock was down 60% in 2026 before the report, making it the S&P 500's worst performer this year.

What carries into Thursday

The reports land after a session in which the Philadelphia semiconductor index fell 3.1% to a six-month low, Reuters said. Qualcomm's results add another data point on how higher memory prices are spreading through the phone market, while Arm's show data center demand helping offset it. Thursday's open will show whether those after-hours moves hold.