Qualcomm is selling more chips for high-end smartphones
Its renewed relationship with Samsung seems to be benefiting both companies.
Qualcomm shipped more Snapdragon chips this quarter than even it expected, and for that reason (and others), made more money. It reported sales of 201 million high-end chips, beating its estimates by at least 6 million. As a result, it raked in sales of $6.04 billion, up 3.6 percent from last year. Not coincidentally, Samsung also reported a very good quarter earlier this month, selling 15 million Galaxy S7/S7 Edge models. The company is, of course, back to using Qualcomm Snapdragon 820 chips (which it actually builds itself), after it stopped with the Galaxy S6.
Though Qualcomm's revenue bump was small, its net income is up 22 percent over last quarter to $1.44 billion. That can also be attributed, in part, to improved sales of its more profitable high-end chips. However, another big reason is that the company is licensing more of its chipsets and technology to China-based OEMs like Huawei, Xiaomi and ZTE, it said. Overall, Qualcomm's licensees sold $62.6 billion worth of devices.
The immediate future of the company looks good, though there could be a few dark clouds. Samung is going to release it's much-leaked Galaxy Note 7 shortly, a smartphone that's expected to have Qualcomm's new Snapdragon 821 CPU in the US, Europe and other markets. That CPU, which gives about a 10 percent performance bump over the 820 model, will likely also appear in upcoming Nexus phones and other important models. However, Apple could switch from Qualcomm to Intel modems on its next model, and as it sold some 231 million phones last year, that could impact the chip company's bottom line.
