Apple (NASDAQ:AAPL), Qualcomm (NASDAQ:QCOM), Corning (NYSE:GLW), and Arm Holdings (NASDAQ:ARM) each collect a share of the money spent on smartphones. Apple sells the phone. Qualcomm supplies chips and patent licenses, Corning makes the glass over the screen, and Arm’s chip designs turn up in almost all smartphones.
But their latest quarterly reports all vary meaningfully. Apple’s iPhone revenue climbed 17% year over year in the September quarter, while Qualcomm’s handset chip revenue dropped 26%. And Corning and Arm both said a softer smartphone market hurt their results.
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All four also pointed to the same pressure: memory chips have become much pricier. But I think it matters really differently for each stock.
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1. Apple’s iPhone is still growing
Apple makes much more money from the phone than the other three do. iPhone sales were around $254 billion for fiscal 2026, which ended Sept. 26. That was 53% of Apple’s revenue and 21% more than a year earlier.
But growth is slowing. iPhone revenue climbed 17% year over year to $57.6 billion in the fiscal fourth quarter, after gaining around 22% in fiscal Q3. And excluding the benefit of tariff refunds, Apple’s gross margin dipped about one point from the June quarter. Management sees it coming in between 45% and 46% in the holiday quarter, mainly because of memory costs.
At roughly $347 as of this writing, Apple trades at about 36 times its expected fiscal 2027 earnings. Investors are paying a premium as its margins fall.
2. Qualcomm’s handset slide is getting steeper
Qualcomm’s phone business is going the other way. Its handset chip revenue dropped 26% year over year to around $5.1 billion in its fiscal fourth quarter, which ended Sept. 27. It had risen 3% in fiscal Q1, then dropped 13% in Q2 and 20% in Q3. For the full fiscal year, Qualcomm blamed lower shipments to some major phone makers, which cut their build plans as memory got scarcer and pricier.
And Qualcomm expects Apple to rely mostly on its own modems from now on, a change it warns will significantly hit its chip sales.
Of course, Qualcomm still collects from the phone through its patents. It renewed its long-term license with Apple, and licensing kept 70% of its revenue as pre-tax profit in the quarter, versus 24% for the chip business. Meanwhile, auto chip revenue surged 89% to nearly $2 billion.
