Huawei’s Switch to Kirin 9000S Processors Poses Challenges for Qualcomm
Despite the US trade sanctions, Huawei has long remained one of the largest Qualcomm customers. In 2023, the Chinese manufacturer purchased over 40 million chipsets from the American year.
However, according to the analytics of Min-Chi Kuo, in 2024 Huawei will completely switch to the Kirin 9000S processors, putting Qualcomm in a challenging position.
Qualcomm’s chip supplies next year can be reduced by 50-60 million units. Assuming each chipset costs $180, the loss of revenue for the American company could amount to about $10.8 billion.
In addition, losing its main wholesale buyer means Qualcomm will now have a serious competitor. To maintain market share, the company will likely have to reduce prices for its chips in the fourth quarter of 2023, which will impact its profits. Samsung with the new Exynos 2400 chipset can also pose a threat to Qualcomm.
Furthermore, according to the forecasts of the aforementioned analyst, in 2025 Apple will begin to use its own 5G modems in its devices, leading to a further decrease in sales for Qualcomm, this time for basic chipsets.
Clearly, the US sanctions imposed on Chinese technological companies have ultimately caused problems for the American manufacturer of Qualcomm chips.
Having lost its largest client and facing growing competition, Qualcomm now risks significant financial losses in the coming years.
Therefore, the company is faced with the difficult question of how to minimize financial losses and stay afloat in these challenging economic conditions. Only time will tell if Qualcomm is able to succeed in this endeavor.