Qualcomm Warns Apple Modem Revenue to Shrink Faster Than Forecast

Apple modem revenue set to dip sharply, Qualcomm says

In an interview with Reuters after its Q3 FY2026 earnings call, CEO Cristiano Amon warned that Apple modem revenue will decline faster than the chipmaker had projected. Supply‑chain bottlenecks are slicing the iPhone’s share of Qualcomm components to well under the previously cited ↓ 20% and the downturn will begin in Q4.

Starting September 1, Qualcomm will hike prices to offset rising production costs, Amon explained. “We’re simply passing through the big cost increases we have,” he said,

“and protecting margins is non‑negotiable.”

Shift toward non‑smartphone chips

For FY2027, the firm anticipates most sales will stem from data‑center and automotive segments, with growth in those areas expected to replace the shortfall from Apple modem revenue. Bloomberg reports that Apple’s in‑house C2 modem, already powering the iPhone 16e, 17e and iPhone Air, could become the default in the upcoming iPhone 18 series, further eroding Qualcomm’s share.

The two companies remain bound by a patent‑licensing pact through March 2027, but the future of that agreement is uncertain, especially as Apple eyes a full‑chip strategy across its portfolio. The broader tech sector, still feeling aftershocks from the pandemic, watches closely for supply‑chain reverberations.

Correction: An earlier dispatch misstated the fiscal quarter as Q4 instead of Q3.