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Qualcomm is about to report it quarterly earnings tomorrow (Wed).
The company is going through strategic review process. Rumors are rife that it may split into QCT (Technology, chip development group) and QCL (Patent licensing group). Investors have been pushing for this split since a while. There is a report at WSJ HERE.
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There are other rumors too about major layoffs. What comes out on Wednesday would be a news to know about this mobile technology giant. In an almost stagnant smartphone business, are employees here for the cut? How about investors?
I heard a rumor that some Qualcomm employees have been informed already that they are not in the upcoming layoff list. So that probably means a major layoff is planned.
It appears unlikely to me they will give leeway to Intel who is trying to enter China in a big way and then compete with Qualcom. But then in China, MediaTek and Spreadtrum are tougher competition for Qualcom then Intel in China. Is it then that Intel competes with MediaTek and Sreadtrum?
Btw, Spreadtrum is a customer to Intel and also Intel has investment into Spreadtrum, so that could further strengthen the combined force against Qualcom and MediaTek.
QCT revenue was at $3.85B, 22% down and op. profit was at $289M down 74% y-o-y.
QTL revenue was at $1.93B, 7% up and op. profit was at $1.65B also up 7% y-o-y.
It will be a tough choice to separate the two. However 2 more directors, Mark McLaughlin and Tony Vinciquerra, Jana Partners nominated, are entering the board. That will further strengthen the case of separation.
Also, 15% of the workforce is set to go, that's a big layoff.
