Investing.com -- Qualcomm shares surged over 11% on Friday before adding a further 1% on Monday, but analysts are urging caution, suggesting the rally owes more to short-covering than improving fundamentals heading into Wednesday's earnings report.

The catalyst for the latest leg higher was an unconfirmed report out of Asia suggesting Qualcomm and MediaTek are working with OpenAI on a processor for an upcoming smartphone, with 2028 production cited as the target timeline.

Wolfe Research analyst Chris Caso acknowledged the move but was measured in his assessment.

"We would be similarly skeptical that an OpenAI phone would materialize into much of a catalyst," he wrote, noting that iPhone and Android's grip on the market "would be tough to overcome."

Caso also cautioned that if OpenAI were to take share from Android, it would only cannibalize Qualcomm's existing business rather than generate incremental revenue.

Bernstein analyst Stacy Rasgon, who rates Qualcomm Market Perform with a $140 price target, echoed that skepticism.

"The responses feel a bit more 'squeeze-y' than fundamental to us at this point," he wrote. Rasgon models full-year fiscal 2026 earnings per share of $10.64, below the Street's $11.02, citing weakening smartphone dynamics and the beginning of a significant Apple content roll-off into year-end.

Mizuho TMT specialist Jordan Klein was the most direct, saying he remains negative on Qualcomm and characterizing the move as a "massive short squeeze and dumb retail chasers."

Klein flagged surging memory prices as a headwind to smartphone demand in the second half of 2026 and warned that Qualcomm's April 29 earnings guidance could serve as a downside catalyst.