AI Takeaway
QCOM delivered Q1 FY2026 revenue of $12.25B (+5.0% YoY), but net income fell 5.5% to $3.0B as surging R&D (+10.0%) and SG&A (+19.6%) costs compressed operating margin by ~300 basis points to 27.5%.
Revenue
$12.25B
++5.00% YoY
EPS (Basic)
$2.81
-1.75% YoY
Operating Income
$3.37B
-5.32% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Total revenue grew 5.0% YoY to $12.25B in Q1 FY2026 (vs. $11.67B in Q1 FY2025), indicating continued demand for Qualcomm's semiconductor and licensing products despite a challenging macro environment.
Source: Source: 10-Q Income Statement
Operating income declined 5.3% YoY to $3.37B as cost of revenue rose 7.9% to $5.57B and SG&A surged 19.6% to $865M, causing operating margin to contract from 30.5% to 27.5% YoY.
Source: Source: 10-Q Income Statement
R&D expense increased 10.0% YoY to $2.45B, reflecting Qualcomm's continued investment in next-generation chip technologies, AI capabilities, and diversification beyond mobile into automotive and IoT segments.
Source: Source: 10-Q Income Statement
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Upgrade to unlockSG&A expenses surged 19.6% YoY to $865M while R&D rose 10.0% to $2.45B, collectively pressuring operating margin down ~300 basis points to 27.5%. If revenue growth does not accelerate to offset these cost increases, profitability could continue to deteriorate.
Source: Source: 10-Q Income Statement
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Upgrade to unlockReported EPS of $3.50 versus the $3.48 analyst consensus — a +0.6% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $12.25B | $11.67B | +5.00% |
Cost of Revenue | $5.57B | $5.16B | +7.89% |
Operating Income | $3.37B | $3.56B | -5.32% |
Net Income | $3B | $3.18B | -5.53% |
EPS (Basic) | $2.81 | $2.86 | -1.75% |
EPS (Diluted) | $2.78 | $2.83 | -1.77% |
R&D Expense | $2.45B | $2.23B | +10.00% |
SG&A Expense | $865M | $723M | +19.64% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $53.03B | $55.58B | -4.57% |
Current Assets | $24.61B | $26.07B | -5.59% |
Total Liabilities | $29.96B | $28.7B | +4.41% |
Current Liabilities | $9.82B | $9.95B | -1.33% |
Cash & Equivalents | $7.21B | $8.71B | -17.31% |
Long-Term Debt | $14.82B | $13.21B | +12.15% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $4.96B | $4.59B | +8.24% |
Investing Cash Flow | $-1.72B | $-671M | -156.48% |
Financing Cash Flow | $-3.88B | $-3.01B | -29.06% |
Share Buybacks | $2.65B | $1.75B | +51.43% |
D&A | $393M | $436M | -9.86% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 27.5% | 30.5% | -2.99% |
Net Margin | 24.5% | — | — |
ROA | 5.7% | — | — |
Current Ratio | $2.505 | — | — |
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Based on the filing data, QCOM reported diluted EPS of $2.78 and revenue of $12.25B for Q1 FY2026. Whether these figures beat or missed Wall Street consensus estimates would require comparison to analyst forecasts, which are not included in the 10-Q filing itself.
Revenue grew 5.0% YoY to $12.25B, but net income fell 5.5% to $3.0B due to a 10.0% surge in R&D spending ($2.45B) and a 19.6% jump in SG&A ($865M). Operating margin contracted ~300 basis points to 27.5%, while operating cash flow remained strong at $4.97B.
QCOM's net income declined 5.5% YoY to $3.0B even as revenue rose 5.0% to $12.25B because operating expenses grew much faster than revenue — R&D rose 10.0% to $2.45B and SG&A surged 19.6% to $865M. These cost increases compressed operating margin from 30.5% to 27.5% YoY.
Qualcomm repurchased $2.65B worth of shares in Q1 FY2026, a 51.4% increase from $1.75B in the same period last year. This aggressive buyback program contributed to a 17.3% decline in cash and equivalents to $7.21B.
QCOM maintains a solid current ratio of 2.51 and generated strong operating cash flow of $4.97B, indicating healthy short-term liquidity and cash generation. However, long-term debt rose 12.1% to $14.82B while cash fell 17.3% to $7.21B, meaning the balance sheet has become somewhat more leveraged compared to a year ago.