Qualcomm Extends Its Deals With Apple And Samsung: Analyst Calls It A 'Not Surprising Development'
Portfolio Pulse from Rounak Jain
Qualcomm Inc. (QCOM) has extended its deals with Apple Inc. (AAPL) and Samsung Electronics Co Ltd. (SSNLF), with the Apple modem deal now running through 2027. Qualcomm reported a 5% year-on-year revenue increase to $9.94 billion for the December 2023 quarter. The extensions highlight the challenges of fabricating high-quality chipsets and modems, as Apple's in-house 5G modem rollout has been delayed, and Samsung continues to use Qualcomm's Snapdragon chipsets for its flagship Galaxy smartphones.
February 01, 2024 | 9:41 am
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POSITIVE IMPACT
Qualcomm's extended deals with Apple and Samsung for modems and Snapdragon chipsets, respectively, and a reported revenue increase may positively influence investor sentiment and stock price.
The extension of Qualcomm's deals with Apple and Samsung is a strong positive signal for the company's future revenue streams and market position. The reported revenue growth further supports a positive outlook, likely leading to a short-term positive impact on the stock price.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100
POSITIVE IMPACT
Samsung's deal extension with Qualcomm to use Snapdragon chipsets for its Galaxy smartphones reaffirms the long-standing partnership, potentially impacting investor sentiment.
Samsung's continued use of Qualcomm's Snapdragon chipsets for its flagship smartphones is a positive for Qualcomm. For Samsung, it shows a reliance on external high-quality chipsets, which could be seen as a positive for maintaining product quality but may also raise questions about the competitiveness of Samsung's own Exynos chipsets.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70
NEUTRAL IMPACT
Apple's extension of its modem deal with Qualcomm through 2027 indicates continued reliance on Qualcomm's technology, which may affect investor perception of Apple's progress on in-house modem development.
While the deal extension with Qualcomm ensures Apple's access to necessary modem technology, it also suggests that Apple's own modem development is not progressing as quickly as expected. This could be seen as a neutral to slightly negative factor for Apple's stock in the short term, as it may raise concerns about the company's ability to innovate independently in this area.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 75