Fri, Nov. 20, 12:41 PM
- Ambarella (NASDAQ:AMBA) has rallied strongly on a day the Nasdaq is up 0.6%. 2.74M shares have been traded; the 3-month daily average is 2.97M.
- On the week, Amabrella is up 15%. The gains come even though top client GoPro (while up 2.5% today) is down 4% on the week after getting hammered on Wednesday due to a bearish Piper note raising pricing/margin concerns. Ambarella, which also sells to GoPro's (NASDAQ:GPRO) rivals and services various non-action camera markets, rose modestly on Wednesday in spite of GoPro's fall.
- Canaccord defended the video processor developer on Monday following a talk with CTO Les Kohn. Kohn argued rival solutions from app processor vendors such as Qualcomm, Intel, and Nvidia can't match Ambarella's offerings in terms of compression and power efficiency, and claimed 3x advantages for both memory bandwidth and power needs for H.264 video compression. Qualcomm (NASDAQ:QCOM) has tried to differentiate its drone offerings in part by providing system-level reference architectures; the company also recently unveiled an IP video camera reference platform.
- Ambarella's FQ3 results are due on Dec. 3. 12.4M shares (43% of the float) were shorted as of Oct. 30.
Thu, Nov. 19, 10:09 AM
- Cristiano Amon, the co-president of Qualcomm's (QCOM +2.1%) chip division (QCT) for the last three years, is now the division's sole president. Murthy Renduchintala, who has also been serving as co-president, will be leaving the company.
- The move comes four months after Qualcomm announced a restructuring that involves cutting 15% of its workforce. The company is coming off an FY15 (ended in September) in which QCT revenue fell 8% Y/Y to $17.2B. Samsung's decision to exclusively use its Exynos app processors in the Galaxy S6/Note 5 weighed, as did the iPhone's share gains (given Apple pairs Qualcomm modems and RF/power management chips with its A-series app processors).
- Qualcomm is bouncing a day after dropping 9.4% on news Korean regulators allege some of the company's IP licensing practices are illegal, and are recommending a fine and business practice changes.
Wed, Nov. 18, 10:17 AM
- The staff of South Korea's Fair Trade Commission (KFTC) allege some of Qualcomm's (NASDAQ:QCOM) IP licensing practices are illegal, and recommends a fine and business practice changes.
- Qualcomm insists its practices are in-line with global norms, and plans to challenge the staff's findings before the KFTC commission. The company has also been dealing with probes from the U.S. FTC and EU regulators; its Chinese dispute was settled in February. EU regulators have been examining the links between Qualcomm's chip and licensing ops; the FTC has been probing the potential violation of obligations to license patents under FRAND terms.
- The allegations come at a time when Qualcomm's relationship with major customer/Korean IT giant Samsung (OTC:SSNLF) has become quite complicated. Samsung opted to exclusively use its Exynos app processors in the Galaxy S6 and Note 5, and also used its own baseband modems in many versions. Qualcomm's Snapdragon 820 baseband/app processor (next-gen flagship, expected to be manufactured by Samsung) will reportedly go into at least some Galaxy S7 models. However, Samsung recently unveiled the Exynos 8890, a baseband/app processor with custom ARM cores and support for 600Mbps peak 4G download speeds.
- Qualcomm recently officially launched the 820, while promising 30% lower power consumption than the Snapdragon 810 (believed to have overheating issues), significantly improved performance via its custom Kryo CPU cores and Adreno 530 GPU, and up to 600Mbps download speeds via an integrated X12 modem. A recent FierceWireless article (has been taken down) indicated the X16, a modem delivering 1Gbps peak download speeds, would arrive in the summer of 2016.
- Shares have fallen to new 52-week lows.
- Update: Bernstein's Stacy Rasgon notes only some of the allegations made in a 2009 KFTC staff report regarding Qualcomm wound up being accepted by the commission. "At this point, we have no idea what the Commission will determine, nor what remedies might be imposed, and we would expect years of appeals before anything concrete (beyond fines) would occur. Nevertheless, the nature of the charges outlined in the Examiner’s report is likely going to cause additional angst among investors who are already worried about the long-term sustainability of Qualcomm’s licensing business..."
Mon, Nov. 9, 10:18 AM
- "Admittedly, we should have made this change when issues with China surfaced a year ago," says Nomura's Romit Shah, downgrading Qualcomm (QCOM -0.8%) to Neutral and cutting his target by $15 to $60. "[W]hile handset OEMs have long been dissatisfied with terms, every patent-related dispute spanning Europe, Korea, Japan and India resolved in favor of Qualcomm. We expected a similar outcome after Qualcomm settled with China’s NDRC in February. China though has proven to be a different animal."
- Citing Qualcomm's FQ4 earnings call remarks, Shah observes the company has seen slower-than-expected progress inking Chinese 4G licensing deals, that existing licensees are withholding/under-reporting payments as new contracts are being negotiated, and that share gains by Chinese OEMs that are often undercutting non-Chinese rivals are impacting royalty revenue.
- Qualcomm also stated on its call it's "actively preparing to enforce our agreements and/or take other actions against OEMs that are not negotiating in good faith, under-reporting royalties, or refusing to conclude agreements within a reasonable period of time," and insisted it has "a number of tools at our disposable that can be deployed both within and outside of China that we believe will ultimately resolve this activity." The WSJ has reported Lenovo and Xiaomi haven't yet agreed to new deals.
- Qualcomm is down 12% since providing soft FQ1 EPS guidance (due to royalty pressures) to go with an FQ4 beat last Wednesday. Shares trade for 12.5x an FY16 (ends Sep. '16) EPS consensus of $4.20.
- Qualcomm's results/guidance, details
Thu, Nov. 5, 9:10 AM| Thu, Nov. 5, 9:10 AM | 32 Comments
Wed, Nov. 4, 6:29 PM
- Qualcomm (NASDAQ:QCOM) has fallen to $56.75 after hours after providing soft FQ1 EPS guidance (and in-line revenue guidance) to go with an FQ4 beat. At the midpoints, the guidance implies 21% Y/Y revenue and EPS declines.
- The company notes stronger-than-expected MSM chip shipments offset slower-than-expected progress in striking new Chinese licensing deals in FQ1 (a deal with ZTE was recently announced). A revenue mix shift towards chips from (higher-margin) royalties pressures EPS. Though not providing full FY16 revenue guidance, Qualcomm is guiding for QTL (licensing division) revenue of $7.3B-$8B vs. an FY15 level of $7.9B.
- Key metrics: FQ4 MSM shipments totaled 203M, -14% Y/Y but above guidance of 170M-190M. FQ1 shipments are expected to total 225M-245M (-9%-17% Y/Y). Reported 3G/4G device sales (from which royalties are collected) rose 2% Y/Y in FQ4 to $58.3B. They're expected to total $50B-$58B (-11% to +3% Y/Y) in FQ1. Estimated 3G/4G device ASP fell to $207-$213 from $220-$226 a year ago. Global 3G/4G device shipments are expected to rise 11%-17% in 2015 to 1.52-1.6B, and 7%-13% in 2016 to 1.67B-1.77B.
- Business performance: QCT (chip division) revenue fell 25% Y/Y in FQ4 to $3.6B (hurt by iPhone share gains and Samsung's use of Exynos processors in the Galaxy S6/Note 5); segment op. profit fell 73% to $280M. QTL revenue fell 1% to $1.8B; op. profit fell 3% to $1.5B. GAAP R&D spend fell slightly Y/Y to $1.36B; SG&A rose 9% to $595M.
- Financials/restructuring: $2.2B was spent to buy back 37.5M shares, and another $1.4B has been spent on buybacks thus far in FQ1. Qualcomm ended FQ4 with $30.9B in cash ($25.6B offshore), and $11B in debt. Thanks to job cuts, the company expects non-GAAP SG&A/R&D spend to drop 6%-8% in FY16. Qualcomm aims to lower its spending run rate by $1.1B/year by the end of FY16, and to cut annual stock compensation by $300M.
- FQ4 results/FQ1 guidance, PR, slides (.pdf)
Wed, Nov. 4, 4:08 PM| Wed, Nov. 4, 4:08 PM | 17 Comments
Tue, Nov. 3, 5:35 PM
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Mon, Nov. 2, 6:30 PM
- Nine months after reaching a settlement with Chinese authorities regarding its 3G/4G royalty rates, Qualcomm (NASDAQ:QCOM) has inked a new licensing deal with major local OEM ZTE.
- The deal covers both mobile devices and infrastructure gear, and features terms consistent with the Chinese settlement. The deal called for a 5% royalty rate on multi-mode 3G/4G devices, and a 3.5% rate on 4G-only devices, off a royalty base equal to 65% of a device's net selling price.
- ZTE is aiming for 60M 2015 smartphone sales, and is also a major mobile infrastructure provider. Qualcomm mentioned in July its Chinese sales were still being affected by under-reporting from OEMs, and that negotiations with certain OEMs remain ongoing. FQ4 results arrive on Wednesday afternoon.
- Last week: Qualcomm appoints strategy/M&A chief, launches modem and IP camera reference platform
Thu, Oct. 29, 2:57 PM
- Brian Modoff, a long-time Deutche managing director and tech/telecom analyst - Qualcomm (QCOM -0.6%) is among the companies he has covered - has been hired by Qualcomm to be its EVP of strategy, M&A, and ventures.
- Modoff will have "companywide oversight for strategy, M&A and [Qualcomm's] venture investment portfolio." Last year, Qualcomm saw Peggy Johnson, an EVP responsible for creating new business opportunities and strategic relationships (among other things), leave for Microsoft.
- In other news, Qualcomm has unveiled two 4G modems meant specifically for low-power IoT applications such as smart metering, wearables, and industrial automation, and an IP camera reference platform that leverages the company's Snapdragon 618 processor (features two 1.8GHz. ARM Cortex-A72 cores + four 1.2GHz. Cortex-A53 cores).
- The more powerful of the IoT modems (the MDM9207-1) contains a 1.2GHz. app processor and is said to enable 10+ years of battery life through a power save mode. The IP camera platform aims to challenge market leader Ambarella; as with its drone platform, Qualcomm is hoping an end-to-end reference design will act as a selling point.
- Qualcomm's FQ4 report arrives on the afternoon of Nov. 4.
Mon, Oct. 26, 10:52 AM
- Apple suppliers Qualcomm (QCOM -2.9%), Cirrus Logic (CRUS -10.1%), Skyworks (SWKS -5.1%), Qorvo (QRVO -5%), Avago (AVGO -4.2%), Broadcom (BRCM -2.3%), NXP (NXPI -3.5%), InvenSense (INVN -2.1%), Synaptics (SYNA -4.4%), and Analog Devices (ADI -2.7%) are selling off after iPhone/iPad power management IC supplier Dialog Semi (down 18.8% in Frankfurt) reported 18% Y/Y Q3 revenue growth and guided for annual Q4 growth to be in a range of -1% to +6%. Both the Q3 sales and Q4 guidance missed consensus estimates.
- NXP merger partner Freescale (FSL -2.9%) is also lower. As is Atmel (ATML -8.1%), which is set to merge with Dialog in a cash/stock deal. Atmel was originally due to receive over half its payout in Dialog shares, whose value has fallen considerably since the deal was announced in mid-September.
- Broadcom, set to merge with Avago, reports after the bell. Apple reports tomorrow, and Cirrus, NXP, and InvenSense on Wednesday. With the help of improving demand and ongoing M&A, chip stocks had bounced strongly from their August/September lows in recent weeks.
Mon, Oct. 19, 1:51 PM
- U.K. retailer Carphone Warehouse has begun taking pre-orders for BlackBerry's (BBRY +0.4%) Priv Android phone. The device, slide-out keyboard/touchpad and all, goes for a steep £579.99 ($899) unsubsidized. Monthly payment plans start at £49/month ($76/month). Delivery is promised by Nov. 6.
- Carphone has also confirmed the Priv's specs. The phone has a curved 5.4" 2K OLED display, an 18MP rear camera with dual-LED flash, a 2MP front camera, a Qualcomm (NASDAQ:QCOM) Snapdragon 808 processor, 3GB of RAM, 32GB of internal storage, and a large 3,410mAh battery. (promo video)
- BlackBerry is hoping the Priv, which pairs Google's version of Android (and all the Google apps/services bundled with it) with BlackBerry apps/services, will carve out a niche with keyboard enthusiasts and high-end enterprise/government users. The company recognized revenue on just 800K phones in FQ2 (the August quarter), down from 1.1M in FQ1 and 2.1M a year ago.
- John Chen has suggested BlackBerry could exit the smartphone market if it doesn't sell 5M phones/year, the level he considers necessary for the company's smartphone ops to be profitable.
Fri, Oct. 16, 5:13 PM
- Intel (NASDAQ:INTC) "now has a thousand people or more working to outfit a 2016 iPhone" with its XMM 7360 2G/3G/4G modem, sources tell VentureBeat. It adds Apple (NASDAQ:AAPL) may dual-source its 2016 iPhone modems via Intel and current supplier Qualcomm (NASDAQ:QCOM).
- That meshes with a March VentureBeat report stating the XMM 7360 will go into 2016 iPhones aimed at emerging markets. Though an August Northland Securities report forecast Intel will supply modems for some iPhone 6S/6S+ units, teardowns indicate Apple is solely relying on Qualcomm's MDM9635M modem.
- The MDM9635M supports 300Mbps peak download speeds, and the XMM 7360 450Mbps peak speeds. Qualcomm, whose high-end modems are generally considered to have a performance/power consumption edge, recently unveiled the X12, which supports 600Mbps peak speeds and will be integrated with its Snapdragon 820 processor.
- Also: VentureBeat reports Apple would like to eventually develop an SoC that features both an A-series app processor and a 4G modem, and which would be manufactured using Intel's 14nm process. The site also suggests Apple is interested in Intel's 10nm process (due in 2017).
- Intel would provide modem IP for the SoC in addition to manufacturing the chip. To date, Intel has paired discrete A-series processors manufactured by Samsung (OTC:SSNLF) and TSMC (NYSE:TSM) with 3rd-party modems (in recent years, Qualcomm's). Intel recently bought 3G CDMA modem assets (needed to service Verizon, Sprint, China Telecom, and certain other carriers) from Taiwan's VIA Telecom.
Mon, Oct. 12, 9:29 AM
- Enterprise software firm PTC is buying Qualcomm's (NASDAQ:QCOM) Vuforia augmented reality technology unit, and acquiring the related developer ecosystem.
- Re/code reported in September Qualcomm is thinking of selling Vuforia, which provides developer tools and IP for creating apps supporting augmented reality (i.e. the melding of real-world and computer-generated material). Qualcomm has claimed Vuforia is supported by 175K+ developers and has been used by 20K+ apps.
- Update: While Qualcomm didn't announce the deal price, PTC states it's paying $65M for Vuforia. The company expects the purchase to close by year's end, and doesn't expect it to impact 2016 EPS.
Fri, Oct. 9, 4:04 PM
- ITC administrative law judge Thomas Pender has ruled Samsung (OTC:SSNLF) and Qualcomm (NASDAQ:QCOM) didn't infringe two Nvidia (NVDA -0.4%) GPU patents asserted by the latter. He did rule the companies infringed a third patent, but also found it to be invalid, arguing the patent doesn't cover a new invention.
- The case will now go to the full ITC commission. Nvidia sued Qualcomm and Samsung last year, alleging their Snapdragon and Exynos processors respectively infringe the company's IP. It obtained a favorable Markman ruling from Pender in April. Samsung, meanwhile, has countersued Nvidia in a Virginia federal court.
- Update: Nvidia has issued a statement regarding Pender's ruling. "We now intend to ask the full commission (which is made up of six commissioners) to review this initial determination and to confirm the previous judgment of the U.S. Patent Office — that the third patent is valid. If they agree, the ITC would issue an order that would preclude Samsung from importing into the U.S. infringing Samsung mobile devices and smart TVs."
Fri, Oct. 9, 9:02 AM
Qualcomm Inc develops digital communication technology called CDMA (Code Division Multiple Access), & owns intellectual property applicable to products that implement any version of CDMA including patents, patent applications & trade secrets.
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