Article

Bank of America has reinstated coverage of Qualcomm with an Underperform rating, citing limited upside potential due to weak growth and competitive pressures. The price target is set at $145, reflecting a 5% upside.

Analyst Vivek Arya noted modest sales growth forecasts of +2%/+1% CAGR for 2025-2028, significantly lower than the semiconductor industry average of +17%. Risks include the anticipated loss of $7-8 billion in business with Apple as the company shifts to in-house chips, and reduced reliance on Qualcomm by Samsung and Xiaomi.

Despite Qualcomm's expansion into automotive and IoT chips, these segments may not fully offset challenges in mobile markets. Revenue from automotive and IoT chipsets is projected to grow at a CAGR of approximately 19% to $17.7 billion by fiscal 2028. Arya also sees limited opportunities in AI infrastructure.