Qualcomm: smartphone sales will fall more than 10% this year, and Apple will not give up its modems in 2023

In the third quarter Qualcomm managed to increase revenues by 22% to $11.39 billion, but not the most optimistic forecast for the smartphone market caused the company's stock price to decline by 7.56% after the close of trading.
According to this provider of mobile processors, at the end of the current calendar year, the smartphone market will shrink not by 5-6%, but by 10-12%.
Since the beginning of this quarter, the company will also stop hiring new staff.Image source: Qualcomm TechnologiesIn the current quarter, as stated by representatives of Qualcomm, the company's revenue will be in the range of $9.2 to $10 billion, which is a couple of billion dollars below the most modest expectations of analysts.
Apparently, this also contributed to Qualcomm's share price decline after the release of financial statistics.
The company's representatives also noted that a sharp decline in demand and an improvement in the supply of components led to an increase in product inventories.
Qualcomm will have to spend the accumulated surplus products in the warehouses for about a couple more quarters.
The company has been running QCT, which supplies chips for smartphones and other devices that transmit data over wireless channels, and has generated $9.9 billion in revenue last quarter, up 28 percent from the same period last year.
Smartphone chip shipments brought Qualcomm $6.57 billion in revenue last quarter, increasing revenue by 40% over the same quarter last year.
The automotive business grew 58% to $427 million, while the Internet of Things added 24%, giving Qualcomm a core revenue of $1.92 billion.
Finally, radio frequency components dropped 20% to $992 million.Technology licensing and patents brought Qualcomm $1.44 billion last quarter, up 8% from a year earlier, but this revenue line still fell short of analysts' expectations.
The head of the company, Cristiano Amon, acknowledged that Qualcomm cannot stay away from the negative impact of macroeconomic conditions on the entire semiconductor industry.
Operating costs are expected to be reduced not only by suspending the expansion of the staff from October this year, but also by other measures.
Regarding the relationship with customers, it was said that the license agreement with Samsung Electronics has been extended until 2030, and in the next quarter the Korean giant will increase the share of Qualcomm chips in its mobile devices.
Almost all of the iPhones next year will use Qualcomm modems, though the company previously expressed fears that it will not get more than 20% of Apple's orders because it has time to introduce modem solutions of its own design.
In a couple of years, in the opinion of Qualcomm's management, Apple will still be able to almost completely abandon the components of the first brand.
According to the forecasts of Bloomberg, the first smartphones Apple with modem components of its own design will not appear until 2024.