iSuppli issues fast facts on Qualcomm’s quarterly results

EL SEGUNDO, USA: To support media coverage of Qualcomm Inc.’s quarterly earnings announcement, iSuppli Corp. is issuing the following fast facts:

* Total revenue for all kinds of semiconductors used in cell phones in the first calendar quarter of 2010 amounted to $9.4 billion, up 4.6 percent from $9.0 billion in the fourth quarter of 2009, according to a preliminary estimate from iSuppli.

This sequential growth in sales runs contrary to the normal seasonal pattern wherein cell-phone-related semiconductor sales decline in the first quarter from the holiday-driven peak in the fourth quarter.

* “The unusually strong conditions in the global mobile phone semiconductor market in the first quarter mainly were driven by the smart phone segment and rising sales of 3G handsets,” said Francis Sideco, principal analyst, wireless communications, for iSuppli.

“Smart phones contain more semiconductor content than plain cell phones, and their share of total mobile handset shipments is rising. Meanwhile, 3G phones also carry a higher semiconductor content than the older 2G models, and represent an increasing portion of total cell phone sales.”

* Qualcomm is expected to report strong revenue and profits for the first quarter. However, this mainly will be driven by increases in Intellectual Property (IP) and licensing revenue, rather than from shipments of chips.

* Qualcomm was the leading supplier of Integrated Circuit (IC) semiconductors for mobile handsets in the fourth quarter of 2009, with a 24.8 percent share of global revenue. However, the company’s share was down from 26.2 percent in the third quarter of 2009 and 29.9 percent in the second quarter.

* “Qualcomm in recent quarters has been losing share in mobile handset ICs to competitors including ST-Ericsson, Infineon and MediaTek,” Sideco said. “While this trend is likely to continue in the first quarter, Qualcomm’s results should provide some indication of whether it has started to stem the tide.”

* While Qualcomm is facing challenges in its core mobile-handset business, the company is taking steps to expand its sales into other product areas.

* “With its Snapdragon processor IC, Qualcomm is vying to address non-handset applications, such as smartbooks, a new type of mobile device that combines features of smart phones and laptop PCs. Products like the snapdragon command higher Average Selling Prices (ASPs) than most ICs used in mobile phones. Revenue-wise, the Snapdragon could make a big impact on Qualcomm’s results in 2010.”