Qualcomm Layoffs: Around 20 Percent In Smartphone Chips Department
After Intel, AMD, and Samsung unsurprisingly either reported losses recently or at least made a gloomy forecast for the rest of the year, Qualcomm is now apparently facing extensive layoffs.
As Asian media reports, the most important supplier of smartphone chips, at least in Western countries, is planning extensive layoffs. According to the Indian publication Business Today, Qualcomm is said to be laying off up to 20 percent of the employees in its smartphone processor department. According to reports, Qualcomm wants to react to the sharp drop in demand from the market for finished smartphones and reduce costs.
The smartphone market shrinks by hundreds of millions of devices this year
According to a report by the Taiwanese industry service Digitimes, there are a number of reasons why Qualcomm wants to reduce the number of employees in the SoC division. Among other things, the report refers to information from Qualcomm’s main competitor, MediaTek, which recently reduced its forecast for the number of devices sold worldwide this year from 1.4 to just 1.1 billion units.
In addition, many smartphone manufacturers are said to be trying to reduce the still high inventories of existing chips, while at the same time shying away from installing the current and next generation of processors in their devices with the Android operating system. Because the next high-end chips from Qualcomm and MediaTek will still come with a structure width of four nanometers, there should be little incentive for device manufacturers to make upgrades.
A clear generational leap in chips is only expected at Apple
Apple is said to be the only manufacturer to switch to processors with a structure width of three nanometers in the course of the year and thus offers relevant advantages over the current generation of chips. It had already been heard in various reports that Apple should have reserved the entire capacity for 3nm chips at its in-house contract manufacturer TSMC for the processors of the iPhone 15 Pro and Pro Max. According to market observers, Apple intends to continue using 4nm chips in the cheaper basic models.
Both the Chinese smartphone suppliers such as Xiaomi and BBK (Oppo, Vivo, OnePlus, Realme) and the well-known globally active manufacturers such as Samsung are still seeing declining sales figures, which is why they are reducing their forecasts for the full year and manufacturing partially massively reduced.
5 percent of employees affected?
At Qualcomm, meanwhile, there should at least be a little more leeway in terms of dependence on smartphone sales. Because the company is selling more high-end chips, Qualcomm is said to be not suffering as much from the overall lower quantities as its main competitor MediaTek. Nevertheless, Qualcomm should now start making cuts.
According to Business Today, around five percent of the Qualcomm workforce will be affected, which would correspond to around 2,000 people according to the current status, since the total number of employees is said to be around 41,000. The company recently reported its latest business figures and admitted that the smartphone market is not expected to improve for the remainder of 2023.
At the same time, Qualcomm indicated that Apple’s sales figures will no longer remain at the previous level since the number of modems supplied to the US computer company for use in iPhones is said to have decreased. However, the crisis does not seem to have reached Apple itself, as the company announced shortly after Qualcomm’s financial figures that iPhone sales had increased slightly year-on-year in the last three months.
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