Qualcomm disclosed its momentum in automotive and Internet of things as it leverages 5G into more growth markets and eyes edge computing.
A few surprises include:
- Qualcomm's IoT revenue, which includes industrial, fixed wireless broadband and networking, has expanded the last three quarters and nearing a $4 billion run rate. IoT revenue for Qualcomm was $926 million in the fiscal fourth quarter and $3.03 billion for the year.
- IoT revenue has been driven by networking, retail, industrial, tracking and utility verticals.
- Automotive chips for telematics and digital cockpit installations delivered revenue of $188 million. This business is Qualcomm's smallest, but brings predictable revenue growth.
- Qualcomm's automotive design win pipeline is about $8 billion, up from $6.5 billion at the start of the fiscal year.
- Qualcomm's fourth quarter handset revenue of $3 billion only had a few weeks of sales from a big OEM customer (think Apple).
CEO Steven Mollenkopf explained:
Our 5G design wins continue to be powered by our RF front-end solutions, whether they support 4G, sub-6 millimeter-wave or both 5G bands, and whether they are in smartphones or other products such as embedded modules for PCs, IoT solutions or mobile hotspots. As we have in RF, we have built beachhead positions in both auto and IoT. Our scale enables us to make multiple profitable bets in areas where we expect a tailwind as each of these industry road maps adopt cellular technologies, as you can see taking place today in automotive, where we have emerged as a strategic technology partner to the automotive industry, with nearly all the major OEMs adopting our products. Next-generation 5G telematics design wins, in addition to our 3G and 4G design wins, solidify our position as a leader in connected cars.
Next up for Qualcomm is to tackle edge computing and cloud infrastructure. "Turning to inference, with over 10 years of AI R&D and over 1 billion AI-capable devices enabled with our technology, and fundamental assets such as low-power compute, process node leadership and signal processing expertise, we are well positioned to extend our smartphone AI leadership into growing applications, such as data centers, edge appliances and 5G infrastructure," said Mollenkopf.
Expansion categories of late include:
- Qualcomm revs reference design for next-gen home mesh network platform
- Qualcomm's Cloud AI 100 aims for first half 2021 deployments
- Qualcomm launches RB5 robotic platform, aims to expand industrial, commercial deployments
When you zoom out on Qualcomm's fourth quarter results it's clear that the company is positioning itself well to take on Nvidia, which may be distracted by its Arm purchase, as well as Intel, which is a cloud, IoT and edge compute leader. The 5G upgrade cycle is likely to be transformational for Qualcomm as it moves beyond its core handset business, which is beating its targets nicely. Arm processors: Everything you need to know