Qualcomm's (QCOM 0.10%) top and bottom lines have grown at an impressive pace over the past year, but the same cannot be said about the company's stock price.

Chart showing growth in Qualcomm's revenue and net income, and fall in its price, since late 2021.

QCOM data by YCharts

Qualcomm investors have pressed the panic button in 2022 on the back of growing evidence of a slowdown in smartphone sales. Global smartphone shipments were down 11% year over year in the first quarter of 2022, followed by a 9% year-over-year drop in the second quarter. The smartphone market is being weighed down by oversupply and weak demand on account of surging inflation and economic headwinds.

This explains why analysts aren't upbeat about Qualcomm's upcoming fiscal 2022 third-quarter earnings report, which will be released after the market closes on July 27, 2022. The smartphone weakness could send Qualcomm stock packing as the company relies on this market for 57% of its revenue. Does this mean investors should cut their losses and sell Qualcomm stock before its earnings are out? Let's find out.

Qualcomm looks set for another solid quarter

Qualcomm anticipates revenue between $10.5 billion and $11.3 billion in fiscal Q3, the midpoint of which stands at $10.9 billion. Analysts, however, are expecting the chipmaker to deliver $10.87 billion in revenue, as they are probably worried about the tepid smartphone sales environment weighing on the company's top line.

But investors shouldn't forget that Qualcomm had delivered impressive growth in the fiscal second quarter that ended on March 27, 2022, which coincided with the first calendar quarter of the year when smartphone sales had dipped in the double digits. Qualcomm's revenue was up 41% year over year in fiscal Q2, driven by a 56% increase in revenue from the handset business.

Clearly, the smartphone market's weakness didn't affect the company's performance earlier this year. That's because Qualcomm claims to have increased its business with major smartphone customers such as Samsung, and its solutions are also gaining traction among Chinese smartphone OEMs (original equipment manufacturers).

Third-party data also points toward an increase in Qualcomm's market share in smartphone processors. Counterpoint Research estimates that Qualcomm cornered 44% of smartphone application processor revenue in the first quarter of the year. In terms of volume, Qualcomm's share stood at 30% in Q1, up by two percentage points over the prior year.

So Qualcomm's strategy of going after premium and high-end smartphones is bearing fruit and giving its sales a nice boost. The company's fiscal Q3 guidance indicates that a similar story could unfold once again, as the midpoint of Qualcomm's forecast would translate into a 35% year-over-year increase in revenue. Additionally, Qualcomm estimates earnings of $2.85 per share at the midpoint of its range, which would be a huge jump over the prior year period's earnings of $1.92 per share.

The chipmaker could beat the smartphone slowdown

Analysts expect Qualcomm to finish fiscal 2022 on a high. Consensus estimates suggest that Qualcomm's revenue in the fourth quarter of fiscal 2022 could increase 27% year over year.

The good part is that Qualcomm seems well-positioned to finish the fiscal year on a high. Samsung, which was a 10%-plus customer for the chipmaker last year, is witnessing healthy sales of its high-end smartphones such as the Galaxy S22 Ultra. At the same time, Qualcomm is also gaining traction in emerging areas such as automotive and the Internet of Things (IoT).

These two businesses had produced just over $2 billion in revenue for Qualcomm in fiscal Q2, up significantly from $1.3 billion in the prior-year period. The chipmaker could win big from these markets, as the demand for automotive connectivity and IoT chips is anticipated to increase at a solid pace in the coming years.

For instance, the connected car market is expected to clock an annual growth rate of 19% through 2026. The IoT connectivity market, on the other hand, is reportedly growing at a similar pace as well as per a third-party estimate. All this indicates that Qualcomm is turning into more than just a smartphone play, which is why investors looking to add a value stock to their portfolio may want to buy it right now.

Qualcomm is trading at just 15.1 times earnings despite its compelling growth. That's lower than the S&P 500's earnings multiple of 20, giving investors another reason to buy this semiconductor stock this earnings season.