Nice Support for Our Holdings From Investor Conferences, Earnings

Let’s catch up on some investor conference comments as well as those from quarterly results out from Cisco CSCO, Foxconn HNHPF and a few others, tying them back to the Portfolio’s holdings.

Qualcomm: Laying Out the Growth Case

Appearing at the JPMorgan Hardware Semis Management Access Forum on Wednesday, Qualcomm QCOM CFO, Akash Palkhiwala, shared that the company’s automotive business is tracking to hit management’s 2026 target this year.

He also reiterated that 80% of segment revenue over the coming four years is more than 80% covered under existing design wins. During the presentation, Palkhiwala reminded everyone where Qualcomm is playing in the automotive market — cloud connectivity, digital cockpit and autonomous driving. Management was also very upbeat about the IoT business, which includes smart glasses, industrial AI and PCs.

Palkhiwala also touched on Qualcomm’s data center opportunity with its pending acquisition of AlphaWave Semi, which is expected to close in Q1 2026. While he reiterated the company line that targets more meaningful revenue for the data center to come in fiscal 2028, the vibe was that the timetable could be accelerated as AlphaWave is acquired and integrated.

In terms of the smartphone market, the conversation was around multi-year agreements with key vendors, including Samsung and Xiaomi, and their positions in the premium market. As a reminder, roughly 85% of the smartphone market is outside of Apple’s AAPL iOS.

The key message from the presentation is that, even as Apple-related revenue ramps down, growth should continue in the remaining smartphone end market. Combined with targeted growth in automotive, IoT, and eventually data center, Qualcomm is positioned to grow meaningfully even as that Apple ramp down occurs.

That is what we aim to capture with our position in QCOM shares, recognizing the revenue ramp could be lumpy over the next few years.

Cisco and Rising Network Capacity Utilization

While Cisco shares are trading off in response to the company’s earnings report on Wednesday night, we like what we heard on the networking front. Those revenues grew 12% year over year and 8% quarter over quarter, with noted strength in Cloud and Enterprise infrastructure. Management called out that AI infrastructure orders reached $800 million for the quarter and $2.1 billion for the trailing 12 months, besting its $2 billion target.

During the earnings call, management underscored one of our key thoughts as it relates to shares of Marvell MRVL in the Portfolio and rising AI adoption:

“As we move towards Agentic AI and the demand for inferencing expands to the enterprise and end-user networking environments, traffic on the network will reach unprecedented levels. Network traffic will not only increase beyond the peaks of current chatbot interaction but will remain consistently high with agents in constant interaction.”

That suggests we should see network spending move higher in the coming quarters, benefitting Marvell’s Enterprise Networking and Carrier Infrastructure segments.

We’ve also talked about how companies in the Portfolio are using AI to drive internal productivity improvements. During the earnings call, Cisco shared one example that speaks to that:

“Today, over 2/3 of support cases are touched by AI and automation, which increases the proportion of complex cases we can solve within one day.”

Foxconn Sees Robust AI Server Demand Ahead

Last week, we discussed July revenue from known Nvidia NVDA and Apple partner Foxconn, and early on Thursday morning, the company released its June quarter results that included higher sales growth at its AI server business in the current quarter. More specifically, the company’s AI server business continued to perform strongly in the June quarter, turning in an annual growth rate of more than 60%.

For the third quarter, Foxconn shared that AI server revenue is expected to increase more than 170% year over year, with rack shipments growing threefold quarter over quarter. Those figures cross-check against rising capital spending levels at Big Tech as well as comments from CoreWeave CRWV about the sharp ramp in its capital spending in the final quarter of this year.

In terms of the smartphone and PC markets, Foxconn reiterated the comments it made last week that those markets will drive “strong growth” in the second half of this year. Certainly supportive for our positions in Qualcomm, Universal Display OLED, Apple and others, but we’ll continue to hunt for fresh comments as we move through the coming weeks that lead up to Goldman’s big tech conference in early September.

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At the time of publication, TheStreet Pro Portfolio was long QCOM, APPL, MRVL, NVDA and OLED.