Shares of the San Diego, California-based chipmaker rose more than 5% in extended trading, adding to year-to-date gains of over 24% as Wall Street invests heavily in the technology that powers generative artificial intelligence.
In contrast, shares of Arm Holdings , (O9Ty.F) lost 5% after the chip firm's cautious forecast fell short of sky-high expectations from investors.
The addition of AI capabilities to smartphones has driven a resurgence in end-market demand after the industry slumped to its lowest level in years, lifting orders for Qualcomm.
The company forecast a fourth-quarter revenue range with a midpoint of $9.9 billion, compared with analysts' average estimate of $9.71 billion, according to LSEG data.
Increased demand from China for premium smartphones is driving orders for Qualcomm's chips in the country, CEO Cristiano Amon said in May.
The addition of AI features have also led to smartphone providers using more of Qualcomm's semiconductors in their devices to help support advanced processing requirements.
"We believe Apple and ARM-based PCs are driving Qualcomm's handset outlook. We think the premium tier smartphone market, which Qualcomm has more market share in, is faring better than the mainstream segment," said Summit Insights analyst Kinngai Chan.
The biggest smartphone chips maker forecast an adjusted fourth-quarter earnings range with a midpoint of $2.55 per share, compared with estimates of $2.45.
Analysts expect Apple to return to revenue growth when the iPhone maker reports results for its fiscal third quarter on Thursday.
In Qualcomm's chip segment, the company forecast a fiscal fourth-quarter sales range with a midpoint of $8.4 billion, compared with Visible Alpha estimates of $8.33 billion.
The company forecast a fourth-quarter patent-licensing sales range with a midpoint of $1.45 billion, higher than Visible Alpha estimates of $1.37 billion.
Qualcomm may also benefit significantly from the rebounding personal computer market where its Arm-based (O9Ty.F) processors used in Microsoft's (MSFT.O) latest AI PCs threaten Intel (INTC.O) and AMD's (AMD.O) longstanding stronghold over the industry.
In its third fiscal quarter, Qualcomm said chip and licensing revenues were $8.07 billion and $1.27 billion, respectively, compared with Visible Alpha estimates of $7.87 billion and $1.31 billion.
