>>> SEMICONDUCTOR STOCKS ARE
MIXED AT THE MOMENT AFTER THE
HOUSE JUST PASSED THE
$280 BILLION CHIPS AND SCIENCE
BILL, WHICH IS EARMARKED ABOUT
$52 BILLION AIMED AT BOOSTING
U.S. SEMICONDUCTOR STATE SIDE.
PASSAGE SENT TO THE WHITE HOUSE
FOR JOE BIDEN SAID HE’D
ABSOLUTELY SIGN TO LAW.
CHIP GIANT QUALCOMM IS A GIANT
IN THE CELL PHONE BUSINESS AND
REPORTED THIRD QUARTER EARNINGS,
WHILE BEAT ESTIMATES, THEY CAME
IN WITH GUIDANCE FOR THE CURRENT
QUARTER FALLING SHORT OF
WEAKENING SALES.
THE BULK OF REVENUE IS FROM
SELLING PROCESSORS AND MODEMS
FOR CELL PHONES.
IT GREW 59% AND IN A CLEAR SIGN
THE COMPANY IS IN THE EARLY
STAGES OF SUCCESSFULLY SUCCESSFU
DIVERSIFYING ITS BUSINESSES,
QUALCOMM REPORTED RECORD
REVENUES IN ITS MASON AUTOMOTIVE
CHIP BUSINESS, WHICH GREW ABOUT
38% ON ANTI-SEEK ANNUAL BASIS.
THIS THING COULD BE MAJOR FOR
QUALCOMM AND THE INTERNET OF
THINGS, IOT BUSINESS, THAT MAKES
LOW POWERED CHIPS FOR CONNECTED
DEVICES, THAT GREW 31%.
ALL OF THIS AS QUALCOMM’S
CUSTOMER APPLE GEARS UP TO
REPORT EARNINGS IN JUST A FEW
MINUTES AND AHEAD OF THAT, APPLE
IS PRETTY MUCH FLAT TO JUST
SLIGHTLY HIGHER ON THE SESSION.
IT IS PERFECT TIMING TO BRING IN
QUALCOMM PRESIDENT AND CEO
CRISTIANO AMON.
GREAT TO HAVE YOU.
LET’S GET YOUR FIRST REACTION IF
WE CAN TO THE PASSAGE OF CHIPS
AND SCIENCE ACT.
>> GOOD TALKING TO YOU, LIZ.
HAPPY TO BE HERE.
VERY EXCITED.
THIS IS A SIGNIFICANT MILESTONE
FOR THE UNITED STATES, CHIP
INDUSTRY AS WELL AS GLOBALLY.
CHIP SET IS ON THE LAW TO BECOME
THE LAW OF THE LAND.
THAT’S VERY, VERY IMPORTANT.
WE KNOW THE IMPORTANCE OF
SEMICONDUCTORS IN OUR ECONOMY,
ESPECIALLY AS EVERYTHING IS
BECOMING DIGITAL, AND AS THE
LARGEST SEMICONDUCTOR COMPANY IN
THE UNITED STATES, WE NEED
MANUFACTURING OF SEMICONDUCTORS.
THOSE FOUNDRIES ARE GOING TO
NEED CUSTOMERS LIKE QUALCOMM.
THIS IS AN EXCITING TIME, IT’S
IMPORTANT, IT’S A BIG WIN FOR
THE UNITED STATES AND GLOBAL
SEMICONDUCTOR INDUSTRY, AND
THAT’S GREAT NEWS FOR
SEMICONDUCTOR COMPANIES LIKE
QUALCOMM.
>> HOW MUCH OF THE MONEY DO YOU
EXPECT TO GET BECAUSE THERE WAS
A DISCUSSION THAT THE GUYS THAT
BUILD THE FOUNDRIES AND THE FAB
PLANTS LIKE INTEL AND TIE TAIWAN
SEMI WERE GOING TO GET THE
LARGER PART AND PEOPLE PEOPLE
LIKE YOU LEFT OUT IN THE COLD
SAYING WHAT ABOUT US?
NOW I DON’T HEAR THAT AT ALL
FROM YOU, WHICH IS FINE, BUT
DOES IT PUT THE GOVERNMENT IN A
POSITION WHERE IT’S PICKING
WINNERS AT ALL, AND DOES THAT
KIND OF NAG AT YOU?
>> NOT EXPECTING TO RECEIVE THE
MONEY AND SUPER EXCITED ABOUT
THE OUTLOOK.
HERE’S HOW YOU SHOULD THINK
ABOUT THIS.
A COMPANY LIKE QUALCOMM, WE NEED
MANUFACTURERS OF SEMICONDUCTORS.
WE HAVE BEEN, YOU KNOW, WORKING
WITH -- WE’RE THE NUMBER ONE
CUSTOMER OF SAMSUNG FOUNDRY IN
KOREA.
WE’RE BETWEEN THE TOP TWO
CUSTOMERS OF TSMC IN TAIWAN,
BEEN THE NUMBER ONE BEING APPLE.
THE ABILITY TO HAVE MORE
MANUFACTURING CAPACITY BUILT IN
DIFFERENT GEOGRAPHIES, FOR
EXAMPLE THE UNITED STATES WITH
THE U.S. CHIP SEC WILL BUILD
RESILIENCE TO THE SUPPLY CHAIN
AND A COMPANY LIKE QUALCOMM, WE
NOW HAVE MORE OPTIONS AND MORE
CAPACITY TO BUILD THEIR CHIPS
EVEN AS INTEL BECOME A FOUNDRY.
SO YOU CAN THINK ABOUT IT, NOW
YOU HAVE ONE MORE FOUNDRY IN THE
INDUSTRY.
THIS IS ALL GREAT NEWS AND WE’RE
NOT EXPECTED TO GET ANY MONEY.
>> LET’S GO TO THE NEXT BIG
HEADLINE AND IT HASN’T COME OUT
YET AND THAT IS APPLE’S
EARNINGS.
WE ARE EXPECTING THAT THEY WILL
POSSIBLY BE DINGED BY A STRONGER
DOLLAR BECAUSE SOMETHING LIKE
58% OF APPLE’S SMART PHONE SALES
COME FROM OUTSIDE THE AMERICAS,
THE STRONG DOLLAR IS WEAKENING
THE EURO CERTAINLY, AND
OBVIOUSLY THE JAPANESE YEN,
WHICH GOT A LITTLE BIT STRONGER
TODAY.
CAN YOU GIVE US SOME CLARITY ON
WHAT YOU HAVE SEEN FROM APPLE
ORDERS FOR YOUR CHIPS TO THEIR
HAND SETS?
>> LOOK, WE’RE NOT IN A POSITION
TO COMMENT SPECIFICALLY ABOUT
ANY CUSTOMER ORDER, BUT WHAT I
CAN TELL YOU ABOUT OUR VIEW OFF
THE HAND SET MARKET GLOBALLY,
NOT FOCUSED ON IPHONES, JUST
GLOBALLY, WE -- WE’RE VERY HAPPY
WITH OUR COMPANY PERFORMANCE IN
THIS QUARTER.
I THINK WE GOT IN TWO, THREE
FISCAL WE HAVE A BEAT AT THE TOP
LINE, A BEAT AT THE BOTTOM LINE.
HAND SETS WERE STRONG AND OUTSET
IOT.
LOOKING AT MACROECONOMIC HEAD
WINDS, WE WERE MORE CAUTIOUS
THINKING ABOUT GUIDING Q4
BECAUSE WE’VE SEEN THE IMPACT ON
CONSUMER SPENDING.
WE’RE CALLING IT A MOBILE MARKET
AND IT’LL BE A LITTLE BIT MORE
SOFT, BUT EVEN THAT WE OURSELVES
HAVE BEEN MORE INSULATED BECAUSE
OUR CONCENTRATION ON THE -- AND
FOCUS ON THE PREMIUM SMART PHONE
FOR ANDROID AS WELL AS HIGH
TIERS WHEN WE CAN SELL A LOT OF
PROCESSER CONTENT IN ADDITION TO
THE MODEM AND FOCUS ON IOT.
WE EXPECT THE HAND SET MARKET TO
BE SMALLER AS WE DEAL WITH THE
ECONOMIC HEAD WINDS AS WELL AS
CHINA LOCKDOWNS.
>> I WANT TO GET TO DIVERSIFYING
YOUR BUSINESS, WHICH QUITE
FRANKLY, I MEAN, YOU TOOK OVER A
YEAR AGO JUNE, AND WHAT YOU HAVE
DONE FOR QUALCOMM WHEN IT COMES
TO THE AUTO INDUSTRY TO ME,
GIVES US A RUNWAY OF WHERE YOU
MIGHT REALLY SEE A MASSIVE
BUSINESS.
NOW, SMALL AT THE MOMENT, IS IT
NOT?
BUT YOU SAW SUCH A BIG JUMP IN
THERE.
EACH CAR, AN AVERAGE SEDAN HAS
SOMETHING LIKE 1,000 TO 3,000
CHIPS IN IT.
THAT’S ACCORDING TO EXPERTS.
WE CHECKED, I SAID REALLY?
IS THAT POSSIBLE?
I THOUGHT IT WAS LIKE 43.
I MEAN, THE SUBARU CEO A COUPLE
YEARS SAID 43 BUT EVERYTHING IS
CHANGING.
CAN YOU TELL US HOW BIG THIS
BUSINESS COULD BE FOR QUALCOMM
AND THROUGH WHAT TIME FRAME?
>> ABSOLUTELY THAT .
IS A VERY BIG PIECE OF THE
QUALCOMM SUCCESS STORY IN
DIVERSIFYING OF BUSINESS.
AUTO AND IOT.
SPECIFICALLY TO AUTO, WE’VE BEEN
EXECUTING IN A SHORT PERIOD OF
TIME ON THIS BIG TREND OF
TRANSFORMATION OF THE
AUTOMOBILE.
THE CAR IS BECOMING DIGITAL.
CAR COMPANIES ARE BECOMING TECH
COMPANIES, AND
DIGIT CALL COCKPIT, AUTONOMY.
WITHIN THE QUARTER WE HAD
$3 BILLION TOWARDS DESIGN
PIPELINE, NOW IT IS 19 BILLION.
THE MAJORITY OF THE IT, THE
MAJORITY OF THE NUMBER,
VOLKSWAGEN GROUP FOR AUTONOMY.
AS THE CARS GET INTO THE MARKET
YOU WILL SEE ALL THE PIPELINE
COMING INTO THE QUALCOMM REVENUE
AND EARNINGS LINE.
FOR THE BUSINESS WE HAVE TODAY,
WE SAW RECORD OUTPUT IN THE
QUARTER AND IN THE NEXT QUARTER,
EVEN IN FACING THE CURRENT
ECONOMIC HEADWINDS WE EXPECT TO
HAVE SEQUENTIAL GROWTH.
IT’S A GREAT STORY AND IN AUTO
WE’LL KEEP PUSHES IT FORWARD.
LIZ: CARS ARE LIKE SITTING IN
AN iPHONE, SAMSUNG IS YOUR
BIGGEST CUSTOMER.
BEFORE WE GO, LAST TIME YOU AND
I SPOKE AT THE CONSUMER
ELECTRONICS SHOW IN VEGAS YOU
STRUCK A PARTNERSHIP WITH
MICROSOFT, METAVERSE HEADSETS,
ANYTHING CONNECTED PEOPLE TO THE
METAVERSE.
META CAME OUT WITH NUMBERS.
WE MAY HAVE TO WAIT TO 030
BEFORE WE SEE REVENUES FROM
THEIR METAVERSE PLANS.
BUT WHAT DO YOU EXPECT FROM THAT
BUSINESS?
>> THERE WILL BE CONTINUED
DEVELOPMENT AND GROWTH FROM NEW
CLASSES OF DEVICES, BUT WITH THE
TREND CONNECTING PHYSICAL AND
DIGITAL SPACE.
IT IS NOT ONLY CONSUMER
ENTERPRISE AS WELL.
THAT IS THE PARTNERSHIP WITH
MICROSOFT.
ALSO THE PARTNERSHIP WITH
SAMSUNG.
MAYBE ONE THING, IF I MAY, LIZ,
ONE OF THE KEY HIGHLIGHTS OF
THIS QUARTER FOR QUALCOMM, I
KNOW THERE IS A LOT OF FOCUS ON
WHAT IS THE SIZE OF THE MARKET
INTO THE FUTURE AND ECONOMIC
HEADWINDS BUT PEOPLE ARE MISSING
THE VERY BIG PART OF THIS
QUARTER.
-- WITH SAMSUNG.
WE ARE BASICALLY GOING TO BE THE
PLATFORM OF CHOICE FOR SAMSUNG
GALAXY PRODUCTS, INCLUDING
FUTURE DEVICES EXTENDED REALITY,
PCs AND TABLETS.
WE’LL STILL REMAIN BULLISH,
VIRTUAL REALITY AND AUGMENTED
REALITY DEVICE AS WE BUILD METAVERSE NEXT COUPLE YEARS.
METAVERSE NEXT COUPLE YEARS.
LIZ: PROMISE ME BE IN VIRTUAL IN