Qualcomm Climbs 8% as Buyback, Snap AR Partnership Power Pivot Beyond Smartphones

Shares of Qualcomm (NASDAQ:QCOM | QCOM Price Prediction) gained 8% and hit $223 in midday trading on Thursday, May 7, before coughing up some of the day’s gains. The move extends one of the sharpest re-rating runs in the chip group this spring.

QCOM stock is now up 61% over the past month. The catalyst stack is unusually broad: a fresh buyback authorization, a new Snap (NYSE:SNAP) augmented reality partnership, and growing conviction in management’s pivot beyond smartphones.

With a market cap near $217.6 billion and a forward P/E ratio of 16x, Qualcomm is being repriced as more than a handset supplier. The combination of capital returns and new growth vectors is reshaping how investors value the chipmaker.

Buyback, Snap AR Deal, and a Data Center Story

Alongside its April 29 Q2 FY2026 report, Qualcomm announced a new $20 billion share repurchase authorization, after returning $3.7 billion to shareholders in the quarter, including $2.8 billion in repurchases and $945 million in dividends. The quarterly payout stands at $0.89 per share.

Layered on top, Qualcomm unveiled a multi-year deal with Snap to supply Snapdragon XR chips for Snap’s AR eyewear platform. That positions Qualcomm as the default silicon partner across major AR/VR programs, with the Meta Platforms’ (NASDAQ:META) Quest line already running on Snapdragon XR.

The numbers behind the pivot are starting to show up. Qualcomm’s Q2 FY2026 revenue hit $10.6 billion with non-GAAP EPS of $2.65, beating consensus by 4%. Automotive revenue set a record at $1.33 billion, up 38% year over year (YoY), while IoT grew 9% to $1.73 billion.

Qualcomm CEO Cristiano Amon also confirmed initial shipments to a hyperscaler are on track. “We are equally excited by our entry into the data center, where a leading hyperscaler custom silicon engagement is on track for initial shipments later this calendar year,” Amon stated on the call.

A Genuine Re-Rating Underway

Q2 FY2026’s day-after move of +15% was the largest single-day earnings reaction in QCOM’s recent history, against an average earnings-day move of -3%. Reddit sentiment on r/investing flipped from unscored on report day to very_bullish readings of 80 to 82 within 48 hours.

The bull case is multi-vector: automotive, IoT, AR/VR design wins, and an emerging data center pipeline that includes a multi-generation hyperscaler engagement. For a deeper look at how AI-era chip stories are being repriced, see our recent coverage of an underrated 2026 AI chip winner.

The bear case persists, however. Handsets still fell 13% YoY to $6.02 billion on memory constraints and Chinese OEM softness, with Q3 FY2026 guidance of $9.2 billion to $10 billion implying further sequential pressure. Furthermore, Qualcomm CFO Akash Palkhiwala has been a consistent seller, including a 1,971-share disposal at $130.12 on April 13.

What to Watch

The next defined catalyst is Qualcomm’s June 24 Investor Day, where management will detail Data Center and Physical AI roadmaps. Prudent investors may want to keep an eye on whether today’s gains hold into the close, and whether the stock can extend through the prior 52-week high of $203.60 on volume.

Wall Street’s published Qualcomm stock consensus target still sits at $168.50, well below the current quote, so analyst revisions in the coming days could shape the next leg. The pivot story is gaining credibility, but execution against NVIDIA (NASDAQ:NVDA), AMD (NASDAQ:AMD), and hyperscaler in-house silicon will determine how durable this re-rating becomes.