Why Qualcomm Stock Tumbled on Thursday

Key Points

• The company put a bow on its annual Snapdragon Summit.

• It introduced new processors to the public.

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Sturdy semiconductor company Qualcomm (NASDAQ: QCOM) was looking a touch shaky on the stock exchange on Thursday. After something of a rally coinciding with its annual Snapdragon Summit, it fell by more than 2%. Contributing factors included profit-taking, concerns about newly announced chips, and an analyst recommendation downgrade.

The summit concludes

The summit concluded on Thursday, with Qualcomm's major development being the unveiling of those chips, the Snapdragon X2 line. This is the second generation of the X series launched to great fanfare last year, not least because it plunged the company directly into the PC market.

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Image source: Getty Images.

In taking the wraps off the X2, Qualcomm said that the processors are far quicker and notably more efficient than competing products. They're also engineered for high performance with gaming and creative applications, both of which are important market niches.

However, investors might feel that the PC segment doesn't have great growth potential. It's also dominated by established chipmakers.

One person who was likely unimpressed with the new hardware is Aletheia Capital's Angus Lin. Before market open Thursday, he downgraded his recommendation on Qualcomm from a buy to a hold.

A notable underperformer, the analyst says

In Lin's view, the company has been one of the more uninspiring major chipmakers so far in 2025, not least because it faces losing several key businesses with heavyweight clients in its foundational mobile segment, such as Apple and Samsung.

Meanwhile, a rise in the costs of wafers -- a crucial input for processors -- will hurt the company's fundamentals.

In his analysis, Lin wrote that "We like [Qualcomm's] auto and internet-of-things growth story, but we estimate these are not enough to move up the company within our forecast horizon."

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Eric Volkman has positions in Apple. The Motley Fool has positions in and recommends Apple and Qualcomm. The Motley Fool has a disclosure policy.