Tag Archives: qcom

Apple ( AAPL ) will tap No. 1 chipmaker Intel ( INTC ) to source 30-40 million iPhone 7 modems, but rival Qualcomm ( QCOM ) will remain top dog, Canaccord analyst T. Michael Walkley predicts. Meanwhile, Qualcomm’s Chinese-licensing recovery is under way despite a $100 million quarterly dispute with South Korean LG, he wrote in a research report. Walkley reiterated his buy rating and 65 price target on Qualcomm stock. For fiscal Q2 ended March 27, the consensus of 35 analysts polled by Thomson Reuters expect Qualcomm to report 96 cents EPS minus items on $5.34 billion in sales, down 33% and 23%, respectively, vs. the year-earlier quarter. Three months ago, Qualcomm guided to $4.9 billion to $5.7 billion in sales and 90 cents to $1 EPS ex items. Then, Qualcomm outlined its improving Chinese negotiations which included four re-signed government-approved contracts. “With the recently signed Lenovo deal, we believe Qualcomm now has the top four Chinese (smartphone makers) licensed for 3-mode and all 3G/4G devices,” Walkley wrote in a research report. He expects licensing sales to buoy in the latter half of 2016. Licensing sales toppled 20% sequentially back in fiscal Q3, ended last June 28, to just short of $2 billion amid the negotiations. Since then, the unit has seen 7%-8% sequential declines. No more, Credit Suisse analyst Kulbinder Garcha says. For Q2, Garcha expects $2.2 billion in licensing sales, up 36% sequentially and down 10% vs. the year-earlier quarter. He expects $7.5 billion in total 2016 licensing revenue growing to $7.6 billion in 2017. But Qualcomm’s chip sales could get snagged in headwinds, Garcha says. Qualcomm quintupled its content in the Samsung Galaxy S7 , teardowns show, but it will likely lose some iPhone 7 share to Intel even as Apple shipments lag. Garcha retained his outperform rating and 67 price target on Qualcomm stock, which is trading near 51, up about 3 percent in 2016.

Wall Street split Friday on Intel ‘s ( INTC ) shrouded PC future. At least one analyst hedged on Intel getting an Apple ( AAPL ) iPhone 7 chip win, as the No. 1 chipmaker prepares to unveil Q1 earnings after the close Tuesday. Intel stock was down a fraction in afternoon trading on the stock market today , near 32. Shares tanked 18% in January and early February on reports of more PC weakness , hitting a year-low 28.22 on Feb. 11. Since then, Intel stock has recovered 13%. For Q1, Intel is expected to report $13.86 billion in sales and 48 cents earnings per share, up a respective 8.5% and 17% from Q1 2015, per the consensus of 45 analysts polled by Thomson Reuters. Three months ago, Intel guided to $14 billion in sales, plus or minus $500 million. Pacific Crest analyst Michael McConnell and S&P Global Market Intelligence analyst Angelo Zino expect Intel to miss the midpoint of its guidance. And McConnell sees Intel cutting its full-year guidance. In January, Intel guided to mid- to high-single-digit sales growth over its $55.36 billion in 2015 sales. Zino notes, “The PC landscape appears to be softer than originally anticipated.” MKM analyst Ian Ing acknowledged Intel’s strong data center sales (about 30% of revenue) but expects Intel’s PC weakness “(to) more than offset strength in cloud computing.” He expects a flat Q2 for PC sales following a subseasonal Q1. But Zino sees Intel’s year-over-year PC losses becoming less pronounced exiting 2016, despite a likely challenging first half. Industry trackers IDC and Gartner predicted 11.5% and 9.6% PC shipment declines in Q1. “We see an aging PC landscape (over 600 million devices more than five years old), market share gains and new innovative devices supporting CCG (client computing group) revenue as the year progress,” Zino wrote in a research report. He reiterated his 39 price target on Intel stock. McConnell has a 35 price target and overweight rating on Intel stock. Ing maintained his buy rating but cut his price target to 38 from 40 on Intel stock. Intel has striven to get its chips inside the iPhone, and rumors recently circulated that Apple might tap the No. 1 chipmaker to source some of its iPhone 7 modems . Qualcomm ( QCOM ) has supplied the iPhone modem in the past four flagship smartphones. But Ing doubts that Apple would risk implementing an Intel chip. Teardowns show that Intel last supplied an iPhone chip in the 2008 iPhone 3G. “We retain some skepticism that Apple would add risk to their global launches,” he wrote in a report.