Qualcomm to raise phone chip prices starting September 1st
Qualcomm announced a price hike on all its processors from September 1st, citing memory pricing increases and supply constraints that have also driven a 20% drop in handset revenue.
Qualcomm CEO Cristiano Amon said on Wednesday that the company will raise prices on all its processors starting September 1st, according to CNBC. Last week, rumors suggested the price increase could be in the double digits.
The announcement came alongside a 20% year-over-year drop in Qualcomm's handset business revenue, the lowest since 2021. In its quarterly earnings report, Qualcomm attributed the decline to “unprecedented increases in memory pricing and supply constraints,” which have been driving up costs across devices from game consoles to laptops and even Raspberry Pi boards.
Qualcomm also expects an acceleration in the revenue dip from Apple products, noting that its modem share for the upcoming iPhone launch will be “materially lower.” The company suggested twice on its earnings call that other businesses would compensate for the decline.
Additionally, Qualcomm announced a decade-long deal to supply chips for BMW. CFO Akash Palkhiwala said some OEMs are beginning to use prior-generation Qualcomm chips in response to higher component costs.
As smartphone revenue declines, Qualcomm plans to become a “tripod” of handset, data center, and automotive businesses. The company said that soon only half of its revenue will come from phones, and by 2029 only one-third will come from phones.
