We recently published a list of 10 Best Semiconductor Stocks to Buy According to Billionaires. In this article, we are going to take a look at where QUALCOMM Inc. (NASDAQ:QCOM) stands against other best semiconductor stocks to buy according to billionaires.

The global semiconductor market is poised for substantial growth, with research firm MarketsandMarkets estimating its value to reach $628 billion in 2024 and expand to $707 billion by 2025, reflecting a robust 12.5% growth rate. The firm, in their Global Semiconductor Industry Outlook 2025 report, also highlights that this surge is driven by increasing demand for semiconductors in data centers, high-performance computing (HPC), and artificial intelligence (AI) applications. As AI adoption accelerates, semiconductors are cementing their role as the foundation of next-generation digital infrastructure. The rising needs of hyperscalers and cloud service providers, particularly in handling AI workloads, are expected to further drive semiconductor industry expansion.

Further, MarketsandMarkets notes that the key growth drivers for the semiconductor sector in 2025 include high-bandwidth memory (HBM) that is crucial for AI accelerators and GPUs, AI servers that power deep learning and real-time analytics, and Gen-AI smartphones featuring advanced AI-integrated chips. However, the industry faces notable challenges as well, including supply chain disruptions and evolving regulatory frameworks that impact production costs, market access, and overall growth.

The cyclical nature of the semiconductor industry and ongoing uncertainties, such as tariffs and trade policies, have been major discussion points among investors. Jordan Klein, Managing Director at Mizuho Securities, had addressed the industry’s demand outlook in a CNBC interview, emphasizing that semiconductor stocks often anticipate market fundamentals six months in advance. While AI-driven companies like NVIDIA are experiencing strong demand, other segments, such as memory, PCs, and industrial chips, are not delivering significant earnings surprises. Meanwhile, investors are increasingly favoring sectors like software and fintech over semiconductors. Klein also raised concerns about a potential slowdown in 2025, suggesting that many investors are currently adopting a “wait and see” approach rather than buying in expectation of near-term improvements. While AI-driven semiconductor companies are likely to maintain momentum, weaker segments may struggle to recover in the short term.

So far, Klein’s take seems to be playing out. The S&P Semiconductors Industry Index is down nearly 13% in 2025, significantly lagging the broader S&P 500, which has fallen about 3.5%. But there’s a silver lining—historically, when semiconductor companies start cutting earnings estimates, their stock prices tend to rebound because those cuts are often already priced in. This could create buying opportunities for long-term investors.

Despite short-term headwinds, the long-term outlook for semiconductors remains strong. AI, cloud computing, and HPC will continue to push demand for advanced chips, and while cyclical downturns and regulatory challenges may create volatility, they also open the door for investors to buy quality semiconductor stocks at lower valuations. Keeping an eye on earnings revisions and broader market trends could help investors find solid entry points in this ever-evolving industry.

Our Methodology

For this list, we first compiled a preliminary list of Semiconductors and Semiconductor Equipment & Materials stocks using a review of online screeners, ETFs and financial media reports. We then analysed Insider Monkey’s database of billionaire holdings to determine the most favoured semiconductor stocks among those investors. We then ranked top 10 of these stocks in ascending order based on the number of billionaire investors holding positions in each company as of Q4 2024. Additionally, we also provide data to assess hedge fund sentiment surrounding these stocks, utilizing data from Insider Monkey’s Q4 2024 hedge fund database to provide deeper insights into institutional investor trends.

Note: All pricing data is as of market close on March 20.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A technician testing the latest 5G device, demonstrating the company's commitment to innovation.

QUALCOMM Inc. (NASDAQ:QCOM)

Number of Billionaire Investors: 19

Billionaire Holdings: $2.6 Billion

Number of Hedge Fund Holders: 79

QUALCOMM Inc. (NASDAQ:QCOM) is a global leader in semiconductor technology, specializing in wireless communications. The company plays a crucial role in advancing 5G technology, supplying chipsets and system-on-chip solutions for mobile devices, automotive applications, and the Internet of Things (IoT). Its Snapdragon processors are widely used across smartphones and connected devices.

In early February, the company provided its Q2 2025 revenue outlook, projecting between $10.2 billion and $11.0 billion in revenue, with adjusted EPS expected to be between $2.70 and $2.90. The company also reaffirmed its goal of reaching $22 billion in non-handset revenues by 2029.

QUALCOMM Inc. (NASDAQ:QCOM) also reported strong Q1 2025 earnings, which exceeded market expectations. Total revenue rose 17% year-over-year to $11.7 billion, while net income reached $3.8 billion, reflecting a solid net margin of 27.3%. The company’s semiconductor division, Qualcomm CDMA Technologies (QCT), performed well across all key markets. Additionally, the Qualcomm Technology Licensing (QTL) segment posted a 20% revenue increase. Automotive and IoT segments also showed significant growth, with revenues increasing 61% and 36% year-over-year, respectively.

Despite these strong results, QUALCOMM faces potential challenges, including a slowdown in the smartphone market and licensing uncertainties with Huawei. However, analysts remain optimistic about the stock’s future. The median 12-month price target stands at $192, suggesting a potential 23% upside.

Overall, QCOM ranks 5th on our list of best semiconductor stocks to buy according to billionaires. While we acknowledge the potential of QCOM to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than QCOM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires

Disclosure: None. This article is originally published at Insider Monkey.