Will Qualcomm Stock Fall To $100 On China Headwinds, Apple Modem?

Question: How would you feel if you owned Qualcomm stock (NASDAQ:QCOM) and it crashed 40% or more in the next few months? Sounds extreme? It has happened before – and it could happen again. Now, Qualcomm stock has fared reasonably well this year, rising by about 5% since early January, compared to the S&P 500, which declined by about 2% over the same period. However, there could be several near-term headwinds for Qualcomm, led by the company’s growing exposure to China, mounting macroeconomic concerns in the U.S. following President Donald Trump’s imposition of tariffs on key trading partners, and, to an extent, following Apple’s push into the mobile modem space. We believe there’s a possibility that the stock could fall to levels below $100 per share. Here’s why investors need to be concerned.

Here’s the thing: in a downturn, QCOM stock could lose considerably. There is evidence from as recently as 2022 that AMD stock lost over 40% of its value in the matter of just a few quarters. So, could Qualcomm’s roughly $160 stock slide to under $100 levels if a repeat of 2022 were to happen? Now, of course, individual stocks are more volatile than a portfolio – and in this environment, if you seek upside with less volatility than a single stock, consider the High-Quality portfolio, which has outperformed the S&P 500 and achieved returns greater than 91% since inception.

Why Is It Relevant Now?

Qualcomm has seen stronger demand from China, driven by the rising popularity of premium Android devices. Its licensing business is also gaining traction, with long-term agreements signed with Chinese manufacturers Honor and Shenzhen Transsion Holdings. Notably, Chinese companies accounted for 46% of Qualcomm’s total revenue last fiscal year. However, this exposure to China brings significant risks with the U.S.-China trade war intensifying under Donald Trump. The new administration is expected to increase tariffs on goods imported from China from 10% to 20%, which could directly or indirectly impact Qualcomm’s revenue streams if Chinese firms were to retaliate by imposing their own restrictions or reducing purchases of U.S.-made components. Moreover, some of Qualcomm’s current demand from China could be temporary, as OEMs may be stockpiling chips in anticipation of future trade tensions.

Trump recently suggested a “25% or higher” tariff on all semiconductor chips imported into the U.S. Such moves could hurt Qualcomm, which relies heavily on Chinese manufacturing and exports. Trump’s bold moves on tariffs and immigration have also stoked fears that inflation could come back. All of this means the U.S. economy could hit a rough spot, and even worse, hit a recession – our analysis here on the macro picture. When you factor in higher geopolitical uncertainty due to bold moves from the new Trump administration, these are critical risks. After all, the Ukraine- Russia war is still ongoing, trade is uncertain. Tariffs drive up import costs and typically result in price hikes, lower disposable income, and weaker consumer spending. This could hurt AMD’s bread-and-butter CPU business, as customers of PCs and laptops could delay purchases, reducing demand for chips.

Apple’s development of its modem chips also poses a threat to Qualcomm. The recently launched entry-level iPhone 16e features an Apple-designed modem, the Apple C1, replacing Qualcomm’s chipsets. Although Qualcomm doesn’t break out revenue by customers, it is estimated that Apple accounts for over 20% of Qualcomm’s total sales – a sizable chunk of Qualcomm’s revenue. While we expect Apple’s transition to its own chips to be somewhat gradual, the effect could be quite pronounced on Qualcomm’s margins, as Apple’s devices typically demand cutting-edge technology and higher-end components. While this risk has been known for some time, it continues to present a downside to Qualcomm’s financials.

How resilient is QCOM stock during a downturn?

QCOM stock has seen an impact that was slightly better than the benchmark S&P 500 index during some of the recent downturns. Worried about the impact of a market crash on QCOM stock? Our dashboard How Low Can Qualcomm Stock Go In A Market Crash? has a detailed analysis of how the stock performed during and after previous market crashes.

Inflation Shock (2022)

• QCOM stock fell 44.9% from a high of $188.69 on 17 January 2022 to $103.88 on 3 November 2022, vs. a peak-to-trough decline of 25.4% for the S&P 500
• The stock fully recovered to its pre-crisis peak by 14 May 2024
• Since then, the stock has increased to a high of $227.09 on 19 June 2024 and currently trades at around $160

Covid Pandemic (2020)

• QCOM stock fell 32.7% from a high of $90.56 on 19 February 2020 to $60.91 on 22 March 2020, vs. a peak-to-trough decline of 33.9% for the S&P 500
• The stock fully recovered to its pre-crisis peak by 8 June 2020

Global Financial Crisis (2008)

• QCOM stock fell 48.2% from a high of $56.37 on 17 August 2008 to $29.21 on 20 November 2008, vs. a peak-to-trough decline of 56.8% for the S&P 500
• The stock fully recovered to its pre-crisis peak by 10 February 2011

Valuation

Qualcomm’s Revenues have seen reasonable growth over recent years, and the stock trades at a relatively fair 17x forward earnings. Qualcomm has seen its top line grow at an average rate of 7.2% over the last three years, but growth rates are projected to slow meaningfully in 2026, with a larger percentage of Apple’s business likely moving out. Moreover, fundamentals can change quickly with the ongoing trade war. Given this growth deceleration and the broader economic uncertainties, ask yourself the question: Do you want to hold on to your QCOM stock now, will you panic and sell if it starts dropping to $120, $100, or even lower levels? Holding on to a falling stock is never easy. Trefis works with Empirical Asset Management — a Boston area wealth manager — whose asset allocation strategies yielded positive returns during the 2008-09 period when the S&P lost more than 40%. Empirical has incorporated the Trefis HQ Portfolio in this asset allocation framework to provide clients better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.

[1] Returns as of 3/10/2025
[2] Cumulative total returns since the end of 2016

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