Qualcomm Chip Sales Down 25 Percent, Plans Layoffs

Smartphone sales are down across the board, and that means component vendors like Qualcomm are also feeling the heat. From a report: The company's Q3 2023 earnings (Qualcomm's fiscal year is October-September) have handset chip sales down 25 percent year over year, with net income down 52 percent year over year. The company also issued lower-than-expected guidance for the next quarter, all causing the stock to drop around 8 percent in the aftermath of the call. Like most other tech companies, Qualcomm's response to the less-than-stellar earnings is to cut costs via layoffs. Earlier this year the company cut 415 jobs at its San Diego headquarters, but the company's securities filing revealed more cuts are coming.

but but we have to make more chips!

[Virtucon]

I see a day here in the near future when we have a lot of FABs that can create semiconductors but with no market for them. Because of politics, we're risking billions of dollars of investment that won't be used.

Re:

[jhoegl]

There will always be a market. We saw demand go nuts in 2021/2022. All because they were off for a few months due to COVID.

That is an indicator of a strained supply chain that was pushed over the edge with a pause.

Re:but but we have to make more chips!

[DraconPern]

The only reason new FAB's are going up in the US is because of politics. There is already no market for them before so we are already wasting billions in the name of national security.  No one wants to pay 30%+ for the same thing.  You think the current inflation numbers are bad... lol

It's not nothing to do with politics

[rsilvergun]

unless you're talking the politics that maintain borders and arbitrary divisions among human beings. But beyond that this is about supply chains. We haven't done anything to stop the next global pandemic. China's still cheerfully running the unsafe wet markets & doing the deforestation practices that caused the the epidemiologists warned us would eventually cause a global pandemic.

Rather than have China curtail those (very profitable) practices we're all gonna build redundant factories so the next t

Re:

[e065c8515d206cb0e190]

unless you're talking the politics that maintain borders and arbitrary divisions among human beings.

Is there a door to your house/apartment? Is it locked? Are your windows closed? How about your car?

Narrow market.

[Ostracus]

I would think Qualcomm would find more uses for it's chips than smartphones. Say a PI killer.

Re:

[rsilvergun]

The PI is just about given away at it's prices. Qualcomm already faces thin margins, I don't blame them for not wanting to get into that space. Never mind that PI's annual revenue is around 90m GBPs while Qualcomm's is 44 billion with a 'b'...

That said, you can absolutely buy single board computers with Qualcomm chips, they're just expensive and mostly used for a handful of industrial applications.

dangerous

[groobly]

The danger here is the potential loss of knowhow. Unfortunately, govt should support the retention of technical people. When demand picks back up, these workers will be off making car alarms or smart doorbells, while China will happily pick up the business.

Re:

[Pinky's Brain]

By the time demand picks up, the shift to Apple will be even further along. Unless Nuvia provides gets them new customers insulated from the Apple competition, it's terminal.