Qualcomm shares 9% slump as weak smartphone chip sales overshadow data-center momentum

If losses hold, Qualcomm is on track to shed over $17 billion in market value.

* The chipmaker has been caught between rising memory costs fueled by surging data-center demand and slowing smartphone sales, as AI infrastructure spending absorbs supply across the semiconductor industry

* "Unlike some other companies, we saw the memory shortage coming and prepared for it early," CEO Cristiano Amon told Reuters

* Android demand showed sequential improvement and the company was making solid progress in expanding beyond its handset business, he added

* Qualcomm's push into data-center and automotive chips has strengthened its long-term growth outlook, but brokerages broadly said the improved visibility was yet to translate into stronger near-term earnings as the Apple revenue roll-off and higher input costs continue to weigh on results

* "We lack conviction in a three-year ramp in a target-rich environment for AI semis, and it's unclear whether a foundation built on custom chips has legs as the business transitions to merchant solutions," analysts at Morgan Stanley said

* Quarterly revenue from the chipmaker's handset division, its largest business, fell 26% to $5.14 billion, pulling chip segment sales 8% lower to $9.02 billion

* Qualcomm trades at 16.78 times forward earnings, well below peers such as MediaTek at 25.41 times and Intel at 33.28 times

* At least 10 brokerages lowered their price targets on the stock after the results, according to LSEG-compiled data.