Will Strength in the Automotive Business Drive Revenues for Qualcomm?

Qualcomm Incorporated QCOM has been witnessing healthy traction in the automotive segment over the past few quarters. During the first quarter of 2026, the company reported a $1.1 billion in revenues from this segment, up 15% year over year.

Its core product strategy involves providing a modular automotive platform that combines Digital Cockpit (infotainment), advanced driver assistance, connectivity that is 5G, telematics and AI compute capabilities inside the vehicle. The platforms that offer these are Snapdragon Cockpit Platform, Snapdragon Ride Flex Platform and Snapdragon Elite platforms. It boasts a worldwide client base that includes leading automakers and technology companies like Volkswagen Group, Toyota, Hyundai Mobis, Leapmotor, Li Auto and several other OEMs.

Several technology trends and other factors are driving this adoption. Qualcomm’s full-stack solution reduces complexity for OEMs and streamlines the deployment process. This also locks customers into the ecosystem, making it harder for them to switch. In the connectivity part, Qualcomm dominates in 5G, WiFi and Bluetooth integration, V2X. Along with the connectivity dominance, its growth prowess in edge AI effectively supports features like voice assistants, driver monitoring and autonomous decision systems. These factors are major growth drivers.

More than 75 million vehicles are already using Qualcomm Snapdragon Cockpit platforms. Management expects a staggering 35% year over year growth from Automotive in the second quarter of 2026. The growth is driven by growing design wins, new vehicle launches and expansion of ADAS + cockpit integration.

How Are Competitors Faring?

In the automotive segment, the company faces competition from the NVIDIA Corporation NVDA and Intel Corporation INTC.

NVIDIA’s automotive sales in the recent quarter were $604 million, up 6% year over year backed by growing adoption of self-driving platforms. NVIDIA DRIVE solutions include a comprehensive stack of hardware and software tools designed to support autonomous vehicles. It is also swiftly working on V2X technology, specifically in AI-driven connectivity for autonomous vehicles. The company is collaborating with more than 320 automakers, tier-one suppliers, automotive research institutions, HD mapping companies and start-ups to develop and deploy AI systems for self-driving vehicles.

Intel’s Mobileye has rapidly expanded in the autonomous car technology market. With its comprehensive Mobileye business offerings related to cameras, in-car networking, sensor chips, roadway mapping, cloud software, machine learning and data management, Intel is gaining ground in the autonomous car technology market. Several manufacturers, such as Toyota, Volkswagen, Ford and Zeekr, use Intel’s Mobileye solution for driver assistance systems.

QCOM’s Price Performance, Valuation and Estimates

Qualcomm’s shares have lost 18.8% over the past year against the industry’s growth of 57.3%.

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Going by the price/earnings ratio, the company's shares currently trade at 11.51 forward earnings, lower than 26.99 for the industry.

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Earnings estimates for fiscal 2026 have declined 7% to $11.16 over the past 60 days, while those for fiscal 2027 have also decreased 7.46% to $11.41.

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Qualcomm stock currently carries a Zacks Rank #5 (Strong Sell).

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