Fri, Mar. 27, 11:48 AM
- After falling 8.3% over the last two days thanks to a major chip stock selloff, Skyworks (NASDAQ:SWKS) is recovering some of its losses in the wake of a $15 Northland Securities target hike to $105. Northland's target was at $80 prior to Skyworks' Jan. 22 FQ1 beat.
- Meanwhile, Citi and Rosenblatt are dueling over near-term smartphone demand. Citi has respectively cut its 2015 and 2016 smartphone unit growth forecasts to 16% and 13% from 19% and 15.5% due to a belief Chinese/emerging markets demand is softer than expected. "We expect a challenging outlook for smartphone companies with high China exposure." With OEMs typically pricing phones in dollars, a strong dollar is seen hurting sales to "price-sensitive markets" in general.
- Rosenlatt, by contrast, says supply chain talks suggest little has changed. "We don’t believe that Taiwan Semi‘s and SanDisk’s forecast cuts are related to the overall smartphone industry ... We believe that Samsung is increasing [Chinese] production from 3 million per month in Q1 to 7-8 million per month in Q2. Qualcomm (NASDAQ:QCOM) and MediaTek are also seeing strong orders from China."
- In addition to Qualcomm/MediaTek, Rosenblatt expects Skyworks, Avago (NASDAQ:AVGO), Synaptics (NASDAQ:SYNA), and Micron (NASDAQ:MU) to benefit from healthy Chinese demand. The firm argued back in December Skyworks and Micron would benefit.
Fri, Mar. 20, 2:15 PM
- The 3G-only Lumia 430 is Microsoft's (MSFT +1.4%) cheapest Windows Phone to date. It has a 4" 800x480 display and 8GB of storage, runs on Qualcomm's (NASDAQ:QCOM) low-end Snapdragon 200 processor (dual-core, 1.2GHz.), and contains a 2MP rear camera to go with a VGA front camera.
- The 430, which goes on sale in April, also supports dual SIMs (important for emerging markets) and comes with up to 30GB of free OneDrive cloud storage. Its unveiling arrives three weeks after Microsoft launched the mid-range Lumia 640 and 640XL, and four months after it launched the low-end Lumia 535 (5" display and 3G-only, starts at €110).
- Low-end devices are believed to account for a big portion of the 10.5M Lumias Microsoft sold in calendar Q4. While costlier Lumias have struggled to gain ground against the iPhone and high-end Android hardware (thanks in part to iOS/Android's app support edge), cheaper models have fared well in many cost-sensitive emerging markets. The 430 aims to significantly lower the cost edge the cheapest Android devices still have.
- IDC estimates Windows Phone had a 2.8% global smartphone unit share in Q4 vs. 76.6% for Android (NASDAQ:GOOG) and 19.7% for the iPhone (NASDAQ:AAPL).
Wed, Mar. 18, 10:42 AM
- Windows 10 (MSFT +0.1%) "will be available this summer in 190 countries and 111 languages," OS chief Terry Myerson writes in a blog post. COO Kevin Turner previously said Windows 10 would be available in in late summer or early fall.
- Meanwhile, during a talk with Reuters, Myerson stated Microsoft will be "upgrading all qualified PCs, genuine and non-genuine, to Windows 10." He asserts Microsoft's goal with the initiative is to "re-engage" with Chinese Windows users, a huge percentage of whom have pirated copies.
- To further its Chinese Windows reach, Microsoft has struck distribution deals with Lenovo, Tencent, and Qihoo; Lenovo will offer Windows 10 "upgrade services" at 2,500 service centers and retail stores, while Tencent and Qihoo will provide the OS to the hundreds of millions of users of their Web services.
- In January, Microsoft promised Windows 10, which contains many features meant to win over enterprises that shunned Windows 8, would be a free upgrade for Windows 7 and 8.1 users. The company has suggested it will rely more on services to monetize Windows (already free or discounted for smaller/cheaper hardware) going forward.
- Microsoft is coming off a December quarter in which its Windows OEM Pro and non-Pro revenue both fell 13% Y/Y, thanks largely to discounts and slowing business PC sales. Intel's Q1 warning (blamed on business weakness and lower-than-expected customer inventories) suggests PC demand has remained soft thus far in 2015.
- Also: Myerson says Microsoft is launching a free version of Windows 10 for small-footprint embedded/IoT devices. Qualcomm (NASDAQ:QCOM) is among the early supporters, launching a development kit that features its mid-range Snapdragon 410 processor.
Wed, Mar. 11, 10:36 AM
- VentureBeat reports Intel's (INTC +3.7%) recently-announced XMM 7360 4G baseband modem (made by its Infineon unit) will go into 2016 iPhone units aimed at emerging markets in Asia and Latin America, thus partly taking a slot reserved for several years by Qualcomm's (QCOM -0.9%) Gobi modems.
- The site adds Apple (NASDAQ:AAPL) engineers "have been making trips to Munich, Germany to work with Intel engineers to ready the Intel LTE chip for the iPhone," and that Intel "has been willing to go a long way to get its LTE chips into Apple phones." Infineon was once the iPhone's (3G) baseband supplier, before Apple switched to Qualcomm.
- The XMM 7360 supports Cat-10 LTE (450 Mbps peak download speeds), as well as 3x carrier aggregation. Qualcomm, which still claims the lion's share of the 4G baseband market, announced a Cat-10 LTE modem (the Gobi 9x45) last November that was declared to offer better power consumption and take up less board space than the prior-gen/Cat-6 9x35.
- Apple sold 193M iPhones last year, and will likely top 200M this year. As is the case with many other clients, Qualcomm's modem sales to Apple help enable the sale of several complementary parts - an RF transceiver, a power management IC, a receive-only chip, and an envelope-tracking IC that lowers power draw.
- Intel is up sharply today after selling off hard yesterday amid a market rout. The chip giant has already seen 18.2M shares traded vs.a 3-month daily average of 29M.
Mon, Mar. 9, 5:40 PM
Mon, Mar. 9, 4:18 PM
- Qualcomm (NASDAQ:QCOM) has launched a $15B buyback program that will replace a prior program with $2.1B remaining. The company plans to buy back $10B worth of shares within 12 months, on top of a current commitment to return 75% of free cash flow to shareholders. At current levels, the new buyback is good for repurchasing ~1/8 of all outstanding shares.
- The quarterly dividend has been hiked by $0.06 (14%) to $0.48/share; that's good for a 2.6% yield at current levels. It will be effective for dividends payable after March 25.
- Qualcomm spent $1.7B on buybacks in the December quarter (FQ1). With the company ending the quarter with $3.6B left on its buyback authorization, today's announcement suggests it has spent $1.5B on buybacks since.
- A 20% dividend increase and $5B buyback hike was announced a year ago. Qualcomm plans to raise debt to finance the new capital returns. The company had $31.6B in cash/marketable securities and no debt at the end of FQ1.
- Shares have risen to $74.21 AH.
Thu, Mar. 5, 7:49 PM
- The WSJ reports Google's (NASDAQ:GOOG) U.S. mobile phone service will initially feature just one phone - the mammoth Nexus 6 phablet, originally designed by Google and made by Lenovo's (OTCPK:LNVGY) Motorola Mobility unit. iPhone fans are out of luck, as are those who prefer more modestly-sized Android hardware.
- The paper adds the service might launch by month's end. As previously rumored, it will rely on Sprint (NYSE:S) and T-Mobile's (NYSE:TMUS) networks, along with Wi-Fi hotspots.
- For those curious, the Nexus 6 has a 6" quad-HD (2560x1440) OLED display, a 13MP rear camera with optical image stabilization, 4K video recording support, and a large f/2.0 aperture, and Qualcomm's (NASDAQ:QCOM) high-end Snapdragon 805 processor (quad-core, 2.7GHz.). Naturally, it runs on an unmodified version of Android 5.0 (Lollipop).
- The report suggests Google will try to avoid ruffling the feathers of its U.S. carrier partners by limiting the amount of hardware supported by its phone service ... and that it will have it act as a showcase for what it thinks mobile services should be like (as suggested by Sundar Pichai) by offering the services through its favorite devices.
- Separately, Google has launched its long-rumored U.S. car insurance shopping site in California (more states will come later). Google asserts the site, known as Google Compare, can provide price quotes for various providers in "as little as 5 minutes."
- A U.K. version of Google Compare has been running for two years. Like rival car insurance shopping sites, Google will get a referral fee on sales; major insurers such as MetLife and Mercury Insurance are on board.
Mon, Mar. 2, 6:39 PM
- Intel (NASDAQ:INTC) has been busy on the first day of the Mobile World Congress, announcing refreshes (and new names) for its mobile processor and modem lineups, as well as new security software OEM deals and alliances with telecom equipment vendors.
- Intel's SoFIA baseband/app processor line, aimed at low-end Android devices, has launched as the Atom x3 line. Three processors are offered - one has a dual-core, 1GHz. CPU and 3G modem, another (made by partner Rockchip) a quad-core, 1.2GHz. CPU and 3G modem, and a third a quad-core 1.4GHz. CPU and 4G modem. Notably, SoFIA uses ARM's (NASDAQ:ARMH) Mali GPU cores, and relies on an older 28nm manufacturing process.
- Also officially launched: Cherry Trail, the 14nm successor to the 22nm Bay Trail line as Intel's entry for the tablet and small-screen convertible market, and whose processors will be sold under the Atom x5 and x7 monikers.
- Relatively few details were provided about x5/x7 parts, which leads AnandTech to suspect they're aimed at late 1H15 and 2H15 products. Intel does note x5/x7 processors will sport powerful Gen 8 GPUs, and (as rumored) the company's next-gen Airmont CPU core.
- The XMM 7360, the latest entry for Intel's standalone baseband modem line, supports Cat-10 LTE (peak speeds of 450Mbps). The prior-gen XMM 7260 topped out at Cat-6 (peak speeds of 300Mbps); Qualcomm (NASDAQ:QCOM) unveiled a Cat-10 modem last November.
- Other announcements: 1) Intel's McAfee unit's VirusScan Mobile software will be pre-installed on Samsung's Galaxy S6, and McAfee's Mobile Security software will be bundled with an LG smartwatch; a pre-install deal already exists for LG smartphones. 2) Intel is partnering with Alcatel-Lucent, Ericsson, and Huawei on creating a variety of network management and radio network hardware running on (Intel-powered) servers.
- Intel is hoping the efforts will bolster a mobile chip division that (thanks in large part to marketing subsidies) posted a $1.1B op. loss in Q4, and a $4.2B op. loss for 2014. Nomura and Wells Fargo are optimistic SoFIA can provide a lift.
- Shares rose 2.4% today to $34.06, aided by a chip stock rally that followed the NXP/Freescale deal.
Mon, Mar. 2, 11:02 AM
- Qualcomm (QCOM -0.5%) has used the first day of the Mobile World Congress to share details about the Snapdragon 820, a next-gen flagship processor (the successor to the 810, which is set to begin shipping in commercial hardware) that will begin sampling in 2H15.
- The 820 makes use of Qualcomm's Zeroth neural networking processor tech, as well as a next-gen ARM CPU core architecture called Kryo (the successor to Qualcomm's Krait); the 810 used off-the-shelf ARM Cortex A-57 cores. Whereas the 810 uses TSMC's 20nm manufacturing process, the 820 will use an unnamed "leading edge FinFET process node" (quite possibly Samsung/Globalfoundries' 14nm process).
- Among other things, Zeroth is said to enable "computer vision, on-device deep learning and smart cameras that can recognize scenes, objects, and read text and handwriting," always-on "awareness Devices that can anticipate user needs by always being aware of their surroundings," and "dynamic audio that can adapt surround sound based on head movement and facial recognition." Qualcomm is counting on the technology to be differentiator as it squares off against MediaTek, Intel, Nvidia, and (indirectly) Samsung.
- Qualcomm has also announced Snapdragon Sense, a fingerprint sensor solution that relies on ultrasonic (sound wave-based) fingerprint recognition rather than (like existing mobile solutions) capacitive touch-based recognition. Qualcomm notes ultrasonic recognition allows a sensor to "scan through a smartphone cover that is made of glass, aluminum, stainless steel, sapphire and plastics," and to "scan through various contaminants that might be present on the finger, such as sweat, hand lotion and condensation."
- Sense is expected to be available in commercial hardware later this year, and is "already in various sampling stages with most major OEMs."
- Leading mobile fingerprint sensor provider Synaptics (NASDAQ:SYNA) is selling off in response. The decline comes in spite of yesterday's Galaxy S6 reveal and a $10 Cowen target hike (to $105). This morning, Synaptics announced a fingerprint sensor solution for gaming hardware, as well as the availability of its TDDI (integrated touch controller/display driver) offerings for mobile devices.
- Last week: Qualcomm backs unlicensed 4G spectrum, invests in drone maker
Fri, Feb. 27, 6:10 PM
- Qualcomm (NASDAQ:QCOM) states its latest small cell base station chipsets (the FSM99xx family) and a new mobile device RF transceiver (the WTR3950) support 4G usage over the unlicensed 5GHz. band (currently used for Wi-Fi).
- Though they can't act as a full replacement for mobile networks using licensed spectrum in lower frequency bands (both due to range and capacity limitations), 5GHz. 4G networks, referred to by Qualcomm as LTE-U, could help relieve congestion and act as a longer-range Wi-Fi alternative in high-traffic/density environments such as train stations, malls, and stadiums.
- Qualcomm adds it has successfully carried out tests "prove co-existence between multiple LTE-U and Wi-Fi access points in ... unlicensed spectrum under extreme load conditions." Phones supporting LTE-U are expected in 1H16.
- Separately, Qualcomm has led a $50M funding round for 3D Robotics, North America's biggest personal drone maker; 3D's drones will use Qualcomm's Snapdragon processors going forward. The funding comes a couple weeks after the FAA proposed commercial drone rules.
Wed, Feb. 18, 7:02 PM
- Looking to fend off MediaTek, Intel (NASDAQ:INTC), and other hungry rivals, Qualcomm (NASDAQ:QCOM) has launched two new 4G baseband/app processors apiece for its mid-range Snapdragon 400 and 600 lines. It has also abandoned its Gobi baseband modem brand in favor of a branding scheme featuring the letter X followed by a number.
- The Snapdragon 618 and 620 are the first announced parts to use ARM's (NASDAQ:ARMH) recently-launched, high-end, Cortex-A72, CPU core: The 618 features two of them at speeds of up to 1.8GHz., and the 620 four of them at up to 1.8GHz. Both chips also contain four low-power Cortex-A53 cores for less demanding tasks, and an X8 Cat-7 LTE modem (300Mbps downlink). The Gobi 9x45, announced in November, supports Cat-10 LTE (450Mbps downlink).
- The Snapdragon 415 and 425 each sport four high-power and four low-power Cortex-A53 cores, with the high-power cores respectively clocked at 1.4GHz. and 1.7GHz. The 415 has an X5 Cat. 4 LTE modem (150Mbps downlink), and the 425 an X8 modem.
- Qualcomm notes the 415/425 are the first 8-core 400 series parts, and that the 618/620 "include features previously only available in the Snapdragon 800 tier, including dual ISP camera, 4K video capture and playback, HEVC hardware encoding, richer gaming ... and advanced Wi-Fi connectivity." AnandTech: "Today Qualcomm raised the bar for low- and mid-range SoCs."
- The company is just three weeks removed from stating it's "seeing heightened competition in China at the mid and high tiers," as it deals with aggressive pricing from MediaTek, Spreadtrum, and others. Intel is also trying hard to gain ground in China and other emerging markets, both through its low-end SoFIA processors and alliances with Chinese chipmakers.
Thu, Feb. 12, 2:00 AM
- South Korea’s Fair Trade Commission is now investigating Qualcomm (NASDAQ:QCOM), adding to the antitrust woes of the U.S. chipmaker following a record $975M fine it agreed to pay China earlier this week.
- The company is also in the midst of dealing with probes in Europe and the U.S. over how it licenses and sells its technology to clients.
- In 2009, South Korea’s antitrust agency fined Qualcomm more than $200M for abusing its dominant market position.
- Previously: China talks to South Korea over Qualcomm violations (Aug. 21 2014)
Mon, Feb. 9, 5:29 PM
- While Qualcomm's (NASDAQ:QCOM) Chinese settlement calls for a 5% royalty rate on multimode 3G/4G devices and a 3.5% rate on other 4G hardware (for "3G and 4G essential Chinese patents"), the rates will be derived from a royalty base of 65% of a device's net selling price.
- Qualcomm's royalty rates are typically derived from an OEM's full sales price. Apple, whose royalty payments are based on the hardware price charged to the company by its contract manufacturers, is a notable exception.
- Existing Chinese licensees will have "an opportunity to elect to take the new [license] terms for sales of branded devices for use in China as of January 1, 2015."
- As part of the settlement, Qualcomm has agreed to expand its existing partnership with Chinese foundry SMIC (NYSE:SMI). Qualcomm struck a deal with SMIC last summer covering the production of 28nm Snapdragon processors.
- TSMC (NYSE:TSM), Qualcomm's primary foundry partner for many years, could see its sales to Qualcomm for older processors (where TSMC's manufacturing process lead relative to SMIC doesn't factor) affected by the SMIC provision.
- QCOM now +3% AH. TSM -0.5%
Mon, Feb. 9, 4:22 PM
- Qualcomm (NASDAQ:QCOM) will pay RMB6.088B ($975M) to settle the Chinese government's antitrust probe, just a little less than the $1B reported by Reuters.
- However, the company will get to charge a 5% royalty rate on 3G-capable devices (including multi-mode 3G/4G hardware, which account for a large % of Chinese 4G phones sold today) for access to "3G and 4G essential Chinese patents," 4G devices that don't support 3G CDMA or WCDMA networks will carry a 3.5% rate. However, the royalty is derived from a base of 65% of the device's net selling price.
- Some fine print: Qualcomm will license its "essential Chinese patents" separately from other patents - that could mean 3G TD-SCDMA patents aren't covered - and negotiate cross-licenses in "good faith." It also won't "condition the sale of baseband chips on the chip customer signing a license agreement with terms that the NDRC found to be unreasonable or on the chip customer not challenging unreasonable terms in its license agreement." However, Qualcomm isn't obligated to sell chips to a non-licensee.
- The company has also agreed to create "a China-specific investment fund of $150 million to further the development of mobile and semiconductor technologies." It already committed $40M to similar investments in December.
- FY15 (ends Sep. '15) guidance has been hiked on the low end: Revenue guidance is now at $26.3B-$28B vs. $26B-$28B, and EPS guidance at $4.85-$5.05 vs. $4.75-$5.05.
- QCOM +2.2% AH to $68.58.
Mon, Feb. 9, 11:51 AM
- "We believe this potential outcome is better than investors feared, and would be consistent with our modeling assumptions used for our F2016 pro-forma EPS estimates," says Canaccord's Mike Walkley (Buy, $84 target) following a Reuters report stating Qualcomm (NASDAQ:QCOM) is close to settling with Chinese regulators in exchange for a $1B fine, lower royalty rates, and licensing policy changes.
- He had already assumed Qualcomm's rate on 5-mode (2G/3G/4G) Chinese phones would fall to 3.25% from 4.5%. Qualcomm typically collects a 3.25% royalty on 4G-only devices, but often gets a higher rate on 3G-capable hardware. Walkley: "With Qualcomm trading in the pre-market at roughly 12x (or 8.5X ex-cash) our F2016 pro forma EPS estimate, we believe the valuation is compelling for longer-term investors."
- Qualcomm's Chinese troubles are a major reason the company has guided for FY15 EPS of $4.75-$5.05, down from FY14's $5.27. They led the company's licensing division revenue to fall 4% Y/Y in FQ1 to $1.8B, even as chip division sales rose 14% to $5.2B.
Mon, Feb. 9, 5:49 AM
- Qualcomm (NASDAQ:QCOM) is likely to pay China a record fine of around $1B to settle violations of a 2008 anti-monopoly law, Reuters reports.
- The deal, which would likely see Qualcomm lower its royalty rates by around a third on patents used in China and would require the company to make changes to its licensing practices, could be announced as soon as today.
- Previously: China to settle Qualcomm violations soon (Dec. 26 2014)
QCOM vs. ETF Alternatives
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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