Qualcomm Sees Strong Q4 Earnings Thanks to 5G iPhone 12
Qualcomm earned $8.3 billion in revenue in the fourth quarter of 2020, according to the company's earnings report that was shared today. That's up 73 percent from the fourth quarter of 2019, with Qualcomm's strong performance due in part to the 5G chips used in the iPhone 12 and other smartphones on the market.
As reported by The Wall Street Journal, Qualcomm CEO Steve Mollenkopf said that some of the Q4 earnings report reflected iPhone sales, but earnings will be more substantial in the next quarter. "Our investments in 5G are coming to fruition and showing benefits in our licensing and product businesses," said Mollenkopf.
Qualcomm also received a one-time payment of $1.8 billion from Huawei, but even without that revenue, Qualcomm's sales were up 35 percent year over year.
Apple and Qualcomm last year settled a vicious legal battle over licensing fees after it became clear Apple would not be able to rely on Intel chips for its 5G iPhones. Apple and Qualcomm signed a multi-year licensing deal and all of the iPhone 12 models are equipped with Qualcomm's 5G modems.
Going forward, Apple plans to use Qualcomm chips for years to come. A recent Apple roadmap suggested the company plans to rely on Qualcomm's X60, X65, and X70 chips through at least 2023. Apple is, however, developing its own modem chips in house and at some point, may shift to its own technology.
Apple in 2019 purchased the majority of Intel's smartphone modem business for $1 billion, giving Apple new wireless technology patents and engineers with expertise in modem development. Intel's former chip team has joined Apple's cellular technologies group, and at the time, Apple chip chief Johny Srouji said that the purchase would allow Apple to expedite development on future products.