Wall Street Will Rethink Qualcomm Price Targets After Google Announcement

While many across Wall Street are still drinking in the positive comments made on Tuesday night from Micron MU and Alibaba BABA, which shares that it will spend more on AI than its original $50 billion-plus target over the next few years, our eyes are on the news driving Qualcomm’s QCOM share higher.

At Qualcomm’s Snapdragon Summit, where Qualcomm is expected to share its next cutting-edge chipset, CEO Cristiano Amon was joined by Rick Osterloh, Google’s GOOGL head of platforms and devices.

What they shared builds on the growing relationship between the two companies as Qualcomm increasingly focuses on the Android operating system. Osterloh shared Google's plans to bring Gemini, its Android AI stack, applications and the developer community to the PC market as part of its efforts to build a common foundation for its products. This means a unified Android platform that will run on smartphones and PCs as well.

In our view, this has the potential to accelerate the part of Qualcomm’s diversification strategy into the AI PC market, but others as well, given Android Auto and Google’s efforts in wearables. That checks all three of Qualcomm’s diversification boxes: AI PCs, automotive and IoT.

As we think about this announcement, it follows the roadmap Apple AAPL has been following as it unifies its device operating systems with an increased look, feel and functionality across them with iOS 26. The growing relationship between Google and Qualcomm is likely to take the biggest bite initially out of Microsoft’s MSFT 70% share of the desktop market, especially given its low to no showing in the smartphone and tablet markets. The initial reaction to this Google-Qualcomm tie-up will weigh on MSFT shares, but as we’ve pointed out to you after Microsoft’s June quarter earnings, now more than ever, Microsoft is an enterprise and cloud company.

Our Qualcomm Price Target

While this is certainly a positive development for Qualcomm, let’s remember the two are working on this, and that means formal products have yet to be announced. Given Amon’s comments that he’s “seen it,” this suggests we are likely to hear more about this effort in the coming months. While Google could hold its own event to showcase these efforts in the coming months, the annual CES trade show held in early January is a hotbed of new product announcements. That would make quite a splash.

In terms of our QCOM price target, this fuels our thinking that Wall Street will need to eventually rethink how it values the shares. The accelerated diversification strategy will lead us to do the same as more details are revealed. With QCOM shares approaching our $180 target, our plan is to maintain that target while we wait for the September revenue reports from Taiwan Semiconductor TSM and Foxconn. Should those show a strong seasonal ramp in smartphone production, we will likely need to raise our QCOM target.

What Did Micron Say About Demand?

During Micron’s earnings call on Tuesday night, it reiterated its smartphone unit shipment forecast for this year that calls for a low-single-digit increase compared to 2024. Given industry shipments in the first half of 2025, that guidance implies smartphone shipments rising low to mid-single digits year over year in 2H 2025. That’s a positive data point for our shares of Qualcomm, but also Apple and Universal Display OLED.

Micron also tweaked its PC shipment forecast for this year incrementally higher to “a mid-single digit percentage” growth from its prior one for low-single digit growth. Another positive for Qualcomm’s diversification efforts, but also one that should give Microsoft something positive to say about Windows 11 adoption when it reports its quarterly results in the coming weeks.

Turning to data center, Micron’s updated outlook calls for calendar 2025 total server units to grow approximately 10%, up from its prior expectation of mid-single-digit percentage growth. Per the Micron management team:

"We believe this change in outlook is in part related to the growth of AI agents and the traditional server workloads agents initiate as they execute tasks on behalf of users. Continued growth in traditional server applications in enterprises is also contributing to additional demand growth. In addition to traditional servers, AI server growth continues to be very robust."

We see that supporting not only our positions in Nvidia NVDA and Marvell MRVL but also ServiceNow NOW and Palantir PLTR, as well as Microsoft’s Azure business and Google Cloud.

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At the time of publication, TheStreet Pro Portfolio was long QCOM, GOOGL, AAPL, MSFT, OLED, NVDA, MRVL, NOW and PLTR.