Qualcomm Incorporated (QCOM) reported fourth-quarter fiscal 2026 GAAP revenues of $10.322 billion, down 8% from $11.270 billion a year earlier, as handset revenues continued to decline and automotive reached a record $1.990 billion.

The semiconductor company said non-GAAP revenues were $10.442 billion, down 7% year-over-year, after a 4% year-over-year decline in the third quarter. GAAP net income was $1.251 billion, or $1.17 a share, versus a $3.117 billion loss, or $2.89 a share, a year earlier. Non-GAAP net income was $2.332 billion, or $2.17 a share, down 28% from $3.00 a share.

President and CEO Cristiano Amon said the company delivered fourth-quarter non-GAAP revenues at the high end of guidance, along with 36% year-over-year growth in combined QCT Automotive and IoT revenues. He said fiscal 2027 marks the start of a non-handset revenue inflection, including the ramp of the Data Center business. Non-handset revenues are projected to grow by more than 60% year-over-year, and the company is reiterating a fiscal 2027 Data Center revenue target of $5 billion.

QCT revenues were $9.015 billion, down 8% from $9.821 billion a year earlier. QTL revenues were $1.304 billion, down 7% from $1.409 billion. QCT earnings before taxes were $2.142 billion, with EBT as a percentage of revenues at 24%, down from 29% a year earlier. QTL EBT was $918 million, with a 70% margin versus 72%.

Handset revenues were $5.137 billion, down 26% from $6.961 billion a year earlier, after a 20% year-over-year decline in the third quarter. Automotive revenues reached the record $1.990 billion, up 89% from $1.053 billion, accelerating from 61% year-over-year growth in the third quarter. IoT revenues were $1.888 billion, up 4% from $1.807 billion. Combined automotive and IoT growth of 36% compared with 28% in the third quarter.

GAAP operating income was $1.356 billion versus $2.918 billion a year earlier. Non-GAAP operating income was $2.769 billion. Cost of revenues was $5.084 billion versus $5.033 billion; research and development was $2.684 billion versus $2.370 billion. Other items excluded from non-GAAP results included $235 million of restructuring and restructuring-related charges and $141 million of acquisition-related charges. Non-GAAP revenues also excluded a $120 million payment to a customer resulting from a recent legal settlement.

The company announced renewed long-term QTL license agreements with Apple, Huawei and Transsion and a multi-generational product collaboration with Amazon for AI data centers. It returned $1.998 billion to stockholders in the fourth quarter, including $1.011 billion of repurchases of 6 million shares and $987 million of dividends.

Qualcomm said the semiconductor industry is experiencing a broad-based increase in input costs across wafer fabrication, assembly, test, advanced packaging, memory and other materials, and that it is taking actions to reflect higher input costs in product pricing. The company anticipates the full benefit of those actions to be reflected in QCT gross margins in the second half of fiscal 2027.

For the first quarter of fiscal 2027, Qualcomm guided revenues to $10.4 billion to $11.2 billion, with QCT of $9.0 billion to $9.6 billion and QTL of $1.3 billion to $1.5 billion. Non-GAAP diluted EPS is estimated at $2.15 to $2.35. Guidance as of the first quarter of fiscal 2027 is inclusive of Data Center.