Qualcomm is predicting a low double digit drop in phone sales after the release of the company’s earnings this week. Qualcomm had already predicted a mid single digit drop as expected in 2022. But taking in to consideration the uncertain macro economic conditions the phone sales will drop much more than expected.
Qualcomm, one of the leading providers of chipsets and modems in smartphones says, “Given the uncertainty caused by the macroeconomic environment, we are updating our guidance for calendar year 2022 3G/4G/5G handset volumes from a year-over-year mid-single-digit percentage decline, to a low double-digit percentage decline.”
The company also speaks of a rapid deterioration in the case of demand and an easing of supply constraints in the semi conductor industry which has led to increased inventory. Their largest customers who are likely to be Samsung and Apple reports to having struggled with not selling enough smartphones and are having difficulties with purchasing from Qualcomm.
According to the article published in The Elec, nearly 50 million of Samsung smartphones are piled up at the distributors. Apple has also taken a decision of not to increase the production of their new iPhone 14 series according to the Bloomberg. Reports also states that their iPhone 14 smartphones are underperforming and is much lower than the company’s expectations.
Qualcomm thus predicts a drop in phone sales and is supposedly going to come down even during the critical holiday sales. More stocks are piling up in their inventory and the current trend will probably make a couple of more quarters to work itself through this crisis.
