Qualcomm's severance-related charges jumped more than eightfold to $332 million
The chipmaker recorded $235 million in restructuring-related expenses in its final fiscal quarter alone. Substantially all of the annual charges were related to severance, although Qualcomm has not disclosed how many employees were affected.
Qualcomm recorded $332 million in restructuring and restructuring-related charges in its 2026 fiscal year, more than eight times the $39 million it reported a year earlier, according to its annual report. The company said substantially all of the charges were related to severance costs.
The bulk of the expense came in the final quarter of the fiscal year, when Qualcomm recorded $235 million in restructuring-related charges, accounting for roughly 71% of the full-year total.
The annual report does not specify how many employees were affected, which divisions or locations were targeted, or how much of the amount has actually been paid. The $332 million figure represents an accounting expense, not necessarily cash already disbursed.
The disclosure comes as Qualcomm prepares another round of workforce reductions. In an October 19 message to employees, CEO Cristiano Amon said the company would undertake a global “performance-focused reduction” following its annual employee review process, with notifications expected to begin in November. Those cuts fall outside the fiscal year covered by the annual report, which ended on September 27.
Qualcomm's workforce nevertheless grew over the course of the year. The company reported approximately 57,000 full-time, part-time and temporary employees at the end of September, up from approximately 52,000 a year earlier. The increase does not rule out reductions in particular teams or business areas, but it suggests the company was also hiring or expanding elsewhere.
The severance costs come as Qualcomm faces pressure in its core smartphone business while trying to build new sources of growth. In its latest quarterly results, released Wednesday, the company reported a 26% decline in handset revenue to $5.14 billion, contributing to an 8% fall in revenue from its chip segment. The handset business has been hurt by weaker smartphone demand and the rising cost of memory chips, while Qualcomm is also preparing for the loss of revenue from Apple's shift toward its own modem chips.
Qualcomm is betting that growth in data-center chips, automotive and other non-handset businesses will help offset that pressure. The company forecast $650 million in data-center sales for the current fiscal first quarter, above analyst expectations, and has said it is targeting $15 billion in annual data-center revenue by fiscal 2029. But the latest results underscored how much the company still depends on smartphones: its shares fell more than 7% in extended trading after the earnings release, as investors focused on weakness in the handset business.
Qualcomm's research and development expenses also increased in fiscal 2026, reaching $10.2 billion, compared with $9 billion a year earlier. The company is investing in areas including data-center technology, automotive chips and the broader Internet of Things market as it seeks to reduce its reliance on smartphones.
