Qualcomm lowers revenue forecasts as Apple squeezes its best customers
Chipmaker Qualcomm on Wednesday revised its revenue forecast downward for 2015, lopping nearly $1 billion off of its high-end estimate and seemingly blaming the change in part on Apple's annexation of market share with the iPhone 6.
Despite booking record revenues for the just-completed quarter, Qualcomm dropped its top-end sales forecast for the rest of the year from $28.8 billion to $28 billion. In its earnings release, the company said this was caused primarily by a "shift in share among OEMs at the premium tier" which has reduced demand for its Snapdragon processors.
That appears to be a thinly-veiled reference to Apple, which has wrenched sales from rival Samsung --?one of Qualcomm's largest customers -- following the release of the larger-screened iPhone 6 and iPhone 6 Plus. The 74.5 million iPhones Apple sold over the holidays were good for half of all mobile phone activations in the U.S. during that time, research suggests.
The iPhone is also grabbing share in China, an important market for Samsung, though one where the company typically ships devices using its in-house Exynos chips. Apple is believed to have sold more smartphones in the Asian nation than any other company in the fourth quarter.
Adding insult to injury, Qualcomm also appears to have lost the contract for Samsung's forthcoming Galaxy S6 as overheating issues plagued preproduction devices. The company expects that its Snapdragon 810, a 64-bit part designed to compete with Apple's A-series, "will not be in the upcoming design cycle of a large customer's flagship device," likely referring to the S6.
The news could be even more bleak for Qualcomm in the future as Apple has been rumored to be considering moving away from the company's baseband chips, which are found in every iPhone. Well-connected analyst Ming-Chi Kuo predicted earlier this month that Intel would win at least part of Apple's baseband business in 2016.
Despite booking record revenues for the just-completed quarter, Qualcomm dropped its top-end sales forecast for the rest of the year from $28.8 billion to $28 billion. In its earnings release, the company said this was caused primarily by a "shift in share among OEMs at the premium tier" which has reduced demand for its Snapdragon processors.
That appears to be a thinly-veiled reference to Apple, which has wrenched sales from rival Samsung --?one of Qualcomm's largest customers -- following the release of the larger-screened iPhone 6 and iPhone 6 Plus. The 74.5 million iPhones Apple sold over the holidays were good for half of all mobile phone activations in the U.S. during that time, research suggests.
The iPhone is also grabbing share in China, an important market for Samsung, though one where the company typically ships devices using its in-house Exynos chips. Apple is believed to have sold more smartphones in the Asian nation than any other company in the fourth quarter.
Adding insult to injury, Qualcomm also appears to have lost the contract for Samsung's forthcoming Galaxy S6 as overheating issues plagued preproduction devices. The company expects that its Snapdragon 810, a 64-bit part designed to compete with Apple's A-series, "will not be in the upcoming design cycle of a large customer's flagship device," likely referring to the S6.
The news could be even more bleak for Qualcomm in the future as Apple has been rumored to be considering moving away from the company's baseband chips, which are found in every iPhone. Well-connected analyst Ming-Chi Kuo predicted earlier this month that Intel would win at least part of Apple's baseband business in 2016.
Comments
[IMG]http://forums.appleinsider.com/content/type/61/id/54834/width/200/height/400[/IMG]
Basically, their mobile phone devision isn't doing as well so now they are playing dirty trying to 'puff up' their SoC chip business.
Those overheating rumors were 'hot' on the lips of Samsung reps at CES..
But we now have other OEMS (LG being one) debunking that 'well sourced' rumor..
Samsung knows no bounds when it comes to slander. Sadly, Qualcomm is no Apple and will be much more vulnerable to Samsung's tactics.
[QUOTE]For the third quarter, global shipments of Android-based smartphones reached 268 million, up from 206 million for the same quarter a year ago. Those numbers helped the OS win a market share of 84 percent, up from 81.4 percent in the year-ago quarter.[/QUOTE]
http://www.cnet.com/news/android-stays-unbeatable-in-smartphone-market-for-now/
If Android phones make up 84% of the smartphone market, and Qualcomm chips seem to be in the vast majority of those devices, they're still selling a s**tload more chips than Apple, right?
Look at the source of your information, CNET, and then look at their source for their statistics, IDC, both worse than BS on an Oklahoma farm...
IDC is well known for producing imaginary who knows were they come from, numbers. Their numbers of "shipped" tablets for Samsung are legendary... In how false they were.
That was my first reaction too ... Next we wait to see the other DED predictions fall into place.
That was my first reaction too ... Next we wait to see the other DED predictions fall into place.
Even a broken clock is right twice a day.
While everyone else is focused on tapping a market or figuring a clever way to drain money from customers or how to cast doubt on their competitors or to copy them etc.
Apple simply keeps doing what it loves to do: make the best conouting products out there.
Bravo.
Umm, It's been debunked more than a few times that the overheating issue was rumor started with Samsung.. to put further pressure on Qualcomm... irony of ironies.. as Samsung has decided to sell their own processor to other OEMs and they wanted to scare off competitors from the Qualcomm version and sell their Exynos to the likes of LG, HTC, etc, instead..
Basically, their mobile phone devision isn't doing as well so now they are playing dirty trying to 'puff up' their SoC chip business.
Those overheating rumors were 'hot' on the lips of Samsung reps at CES..
But we now have other OEMS (LG being one) debunking that 'well sourced' rumor..
Samsung knows no bounds when it comes to slander. Sadly, Qualcomm is no Apple and will be much more vulnerable to Samsung's tactics.
From what I've read, rumors that Samesung planted rumors about the 810 overheating seem to be themselves, just that, rumors. Don't get me wrong, it is absolutely in character with Samesung to do such a thing. I just haven't read anything that was a definitive source that they had planted the overheating rumors.
I'll second that. They really just create good quality products, that's the whole secret to their success.
It has not been debunked. The reporters who used that LG phone stated that it was pretty hot, hotter than a phone should be. Perhaps Samsung has a different standard for heat output than trailing edge LG does.
What I love about Apple and what is earning them this type of power is the simple fact they exist to make the best computing devices in the world.
While everyone else is focused on tapping a market or figuring a clever way to drain money from customers or how to cast doubt on their competitors or to copy them etc.
Apple simply keeps doing what it loves to do: make the best conouting products out there.
Bravo.
Agreed.
And this is why Apple's would-be competitors fail—NOT because Apple is so successful and that it made most of the money (there's ALWAYS more money to be made, markets and customers to be had or MADE)—because they failed to be inspired by Apple's EXAMPLE of how it's done business since Jobs' return, and build their own companies with similar values and focus and follow through.
I'm really excited to see Sammy's quarterly report
From MR "On the heels of an earnings call that saw Apple announcing record earnings, rival phone maker Samsung today announced its own results for the October to December period, reporting a 27 percent quarterly decline in earnings."
There is no money on low end components. They have to commit enormous $ to architect a new chip so it needs high end phone manufacturers
Haha!!
I figured Apple Insider would have an article up about this!(or DED editorial)
I thought they hadn't reported yet
Maybe they're just not relevant anymore?
I have noticed less and less Sammy articles!! Hahaha.
OK, maybe I'm missing something, but I don't understand the slant of this article.
http://www.cnet.com/news/android-stays-unbeatable-in-smartphone-market-for-now/
If Android phones make up 84% of the smartphone market, and Qualcomm chips seem to be in the vast majority of those devices, they're still selling a s**tload more chips than Apple, right?
Absolutely. Apple is doomed.
OK, maybe I'm missing something, but I don't understand the slant of this article.
http://www.cnet.com/news/android-stays-unbeatable-in-smartphone-market-for-now/
If Android phones make up 84% of the smartphone market, and Qualcomm chips seem to be in the vast majority of those devices, they're still selling a s**tload more chips than Apple, right?
I had to edit my response after realizing the Cnet article was dated October 31, 2014.
I am looking forward to seeing how IDC and Strategy Analytics spin this quarter's iOS sales vs. Android shipments. With the world knowing Samsung smartphone shipments have collapsed, IDC and Strategy Analytics will have to discover a lot of previously undiscovered white box Android smartphones that had never been accounted for to keep Google's Android (see the title of the Cnet article) above 80% global smartphone market share.