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Automotive Drives Qualcomm’s Second Quarter Earnings

The world’s biggest seller of smartphone processors, Qualcomm, has issued a strong earnings report for the quarter ending March 24. Its revenue growth is led not by sales to the smartphone industry, but instead to the automotive sector.

Overall, revenue rose 1 per cent to A$14.38 billion. Net income was A$3.57 billion versus A$2.6 billion in the year-earlier period.

The San Diego-based company noted that revenue from the smartphone segment gained 1 per cent last quarter, slower than the 16 per cent increase in the previous three months.

However, sales to phone makers in China, surged 40 per cent in the first half of the fiscal year, “reflecting our strong competitive positioning and recovery of demand.”

Qualcomm says that the likes of Xiaomi, Honor, OnePlus Technology, Oppo and Vivo were driving demand.

However, the real driver of business in the quarter concluding March was its automotive business wherein it sells chips to auto manufacturers. That division grew 35 per cent year-on-year to generate a revenue of A$923.19 million.

Qualcomm has issued a positive outlook for its current quarter ending June, saying that it forecasts overall sales of between A$13.47 billion and A$14.7 billion in the current quarter. Its automotive business will continue to keep up the momentum with an expected double digit percentage growth in the current quarter too.

“We are excited about our continued growth and diversification, including achieving our third consecutive quarter of record QCT Automotive revenues, upcoming launches with our Snapdragon X platforms, and enabling leading on-device AI capabilities across multiple product categories,” said Cristiano Amon, president and CEO of Qualcomm.

Qualcomm has been pushing forward with innovation, including in its IoT division. It recently announced a breakthrough wifi technology, Qualcomm QCC730 Wi-Fi solution for IOT connectivity, which it says provides up to 88 per cent lower power than previous generations and can revolutionise products in battery powered industrial, commercial and consumer applications.

Also, Qualcomm recently revealed its new Snapdragon X series of processors, designed for Windows on Arm laptops. Four chipsets were revealed as part of the range, three of which belong to the Snapdragon X Elite tier. The remaining chipset is the Snapdragon X Plus and is expected to power more affordable laptops.

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