Qualcomm still riding strong but signs of ripples in the waters ahead
Qualcomm is confronting long term issues as mentioned in recent articles. These include the initial explosive growth of SmartPhones has started to taper off as developed markets have reached a saturation point and leading competitors are almost equal in features and an end to the 'wow factor' of new innovations. More innovation is derived from new software features, camera resolution, etc. There remain many new frontiers to conquer but these tend to be less 'wow factor' than incremental improvements, such as achieving lower power to enable longer operating life.
An additional problem is the rise of the lower cost SmartPhones with capabilities that are now only about a year to 18 months behind those of the bleeding edge premium devices. The market for clones of popular devices is particularly robust in China, India and other populous regions that comprise about 2/3 of the total world population and the majority of new markets. Chief among the chips suppliers is MediaTek which is expected to soon raise their guidance for sales in 2013:
see article: MediaTek likely to raise shipment target for 2013
"MediaTek previously set a shipment target of about 200 million smartphone solutions for 2013, compared to the about 110 million units shipped last year." The new guidance is expected to be 10%-25% higher. Mediatek is due out with an 8-core 3G MTK6589 with LTE support in the MTK6599 due out latter this year.
One article chides Mediatek as not having LTE until several month after Qualcomm and other suppliers. However, MediaTek's primary markets are the populous regions where demand for sub $250 SmartPhones is highest. Their entry will coincide with the major roll outs of TD-LTE in China, Russia, India, Indonesia and probably here in the US once Sprint-Softbank-Clearwire-DISH get something settled out.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.