People walk past Qualcomm's stand during the Mobile World Congress in Barcelona, Spain February 24, 2016.

JPMorgan lowered its rating on Qualcomm to neutral from overweight due to the risk of deteriorating smartphone demand next year.

The company is a leading provider of mobile processors and chipsets.



"The outlook for the global consumer is negative in early 2017 in our opinion and could weigh on Qualcomm's smartphone exposed fundamentals," analyst Rod Hall wrote in a note to clients Wednesday.

"We also see the shares as more fully valued with returns dominated by the NXPI deal which isn't expected to close until late 2017."

Qualcomm agreed to buy chipmaker NXP Semiconductors in October for about $38 billion.