Qualcomm (QCOM) shares plummeted 5.07% in after-hours trading on Wednesday, despite reporting better-than-expected third-quarter results. The semiconductor giant's weak fourth-quarter guidance and ongoing concerns about its business model overshadowed its strong Q3 performance.

For the third quarter, Qualcomm reported adjusted earnings per share of $2.77, surpassing analyst estimates of $2.71. Revenue came in at $10.37 billion, slightly above the expected $10.35 billion. The company's performance was driven by resilient demand for its mobile chips and expanding opportunities in automotive and Internet of Things (IoT) sectors.

However, investors seemed more focused on Qualcomm's fourth-quarter outlook and long-term challenges. The company forecasts Q4 adjusted EPS between $2.75 and $2.95 on revenue of $10.3 billion to $11.1 billion, which falls short of analysts' expectations. This conservative guidance, coupled with concerns about Qualcomm's reliance on premium smartphone chip sales and the looming loss of Apple as a modem customer, appears to have spooked investors. The company reiterated its warning that Apple's shift to its own modem chips in future devices will impact its chip segment revenue, adding to the downward pressure on the stock.