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More on Qualcomm: Digitimes reports Qualcomm and Spreadtrum (SPRD) have cut prices for Chinese...

More on Qualcomm: Digitimes reports Qualcomm and Spreadtrum (SPRD) have cut prices for Chinese quad-core chips due to competition from MediaTek; Qualcomm has reportedly cut prices below $10 (low by its standards). The report is noteworthy given Qualcomm's growing Chinese presence, and the fact its chip margins (along with chip/royalty mix) had much to do with its disappointing FQ3/FY13 EPS guidance. Thanks to heavy R&D spend and a mix shift to emerging markets, the chip unit's op. margin fell to 17% in FQ2 from the year-ago period's 20%, and is expected to stay at 17% in FQ3; aided by FQ1's 26% margin, FY13 guidance is still for 18.5%-20.5%.
Comments (2)
  • Howard Hunt
    , contributor
    Comments (62) | Send Message
     
    My gut tells me the Chinese will not let QCOM make its customary mgns...like so many Western companies before them, who went to China "snowed" by the size of their market, only to be snuffed out when production facilities erected there became significant.
    27 Apr 2013, 12:43 PM Reply Like
  • lorvic1
    , contributor
    Comments (94) | Send Message
     
    I did not find the last report either lacking or the guidance disappointing. I saw it as strong.
    27 Apr 2013, 12:44 PM Reply Like
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