Qualcomm last month again lowered its smartphone shipment forecast and made a pessimistic assessment for the next few quarters, according to the Wall Street Journal. Qualcomm Chief Financial Officer Akash Palkhiwala said Qualcomm is reducing spending in mature business areas, making selective layoffs in certain functions and preparing for contingency plans.
Qualcomm cut its sales forecast for handset chips to a lower double-digit percentage decline from a previous mid-single-digit drop, joining other consumer-facing businesses that face a sharp shift in demand after a boom driven by the new crown epidemic, the report noted.
Regarding 2023, Palkhiwala said, “There is a lot of global uncertainty. There’s the macroeconomic environment, what’s happening in the U.S., China and Europe, and the New Crown epidemic situation in China – how long it will take to resolve. In the semiconductor industry, some of our customers have large inventories.” Palkhiwala believes it will take several quarters to resolve the inventory issue.
As a result, Qualcomm is working to reduce operating costs and double down on new areas, including its automotive business. These are the key drivers of Qualcomm’s business growth. In addition, Qualcomm has made selective reductions in certain functions. The third thing is that Qualcomm is preparing a contingency plan.
