It has been a tough few weeks for plenty of artificial intelligence (AI) stocks. And to be fair, some of them deserved their share price setbacks.
Not all of them, though. In several cases, investors have thrown the proverbial baby out with the bathwater. Smart investors know that conditions like this ultimately spell opportunity.
To this end, growth-minded investors with $1,000 they're ready to put to work for a while may want to consider jumping into Qualcomm (QCOM 2.19%) while it's trading at a 23% discount from its early January high.
Yes, Qualcomm
Anyone keeping tabs on Qualcomm of late might be a bit surprised at such a suggestion. The results it reported earlier this month for its fiscal 2026 first-quarter (which ended Dec. 28) weren't great. Although sales and earnings both topped analysts' estimates, the top line only improved 5% year over year. Meanwhile, management's guidance was downright alarming. The company is only looking for revenue between $10.2 billion and $11 billion for the quarter currently underway, versus analysts' consensus estimate of around $11.1 billion, and only up slightly from the year-ago comparison of $10.8 billion.
Qualcomm explained that its business is largely being stymied by the ongoing shortage of memory chips... which it is.
Image source: Getty Images.
As is so often the case, though, the market is so focused on the past and even the present that it's not thinking about the future, which is the one thing that should mean the most to investors at any given time.
And the future here actually looks quite bright.
Still gelling, with or without enough memory chips
Not the immediate future, mind you -- that's clearly going to be tepid. If you can look just a little further down the road, though, there's every reason to believe we'll be seeing glimmers of hope soon enough.
It has everything to do with the sliver of the chip market that Qualcomm serves. Initially designed for smartphones, Qualcomm's Snapdragon microprocessor chip is increasingly being found in AI-capable laptops and wearables, as well as serving as the centerpiece of more and more high-tech "connected" cars. It's eventually even going to handle some driver-assistance duties.
NASDAQ: QCOM
Key Data Points
And 2026 could be the breakout year for this computing processing technology found somewhere between people's mobile devices and the cloud. As Qualcomm CEO Cristiano Amon recently said in an interview with The Wall Street Journal, "The biggest opportunity ... I think people finally see, in 2026, the opportunity that exists on the edge, especially if you have the ability to do a lot of processing on the edge."
Amon acknowledged his bias (Qualcomm's Snapdragon processors are now built for edge computing). He's not wrong, though. As artificial intelligence data centers bump into capacity constraints, the world is apt to begin understanding and accepting that a great deal of high-level processing work can be offloaded to platforms that are not currently at the forefront of the AI trend.
Then in 2027, Qualcomm expects its processing chips to start showing up in AI data centers. That makes sense. As the AI business adds more inference models, this company's purpose-built processors' power efficiency and better memory bandwidth (compared to GPUs) will make them a choice the artificial intelligence industry must at least consider.
And after that, we'll see a growing market in AI-powered robotics, including humanoid robots.
Always pricing in the future
But what of the worldwide memory shortage? It's still an issue, to be sure, and is expected to remain one for a while. This could weigh on investors' minds the whole time.
The fact is, however, most AI stocks -- including Qualcomm -- are likely to begin performing better before the supply shortfall is obviously easing, as investors will sense and anticipate this trend before there's clear and confirmed evidence of it. Analysts see it coming anyway.
Data source: Morningstar. Chart by author.
In the meantime, most (if not all) of the memory shortage's bad news may already be reflected in Qualcomm stock's current price, with none of the inevitable upside priced in. That's how the stock market often works.
