Qualcomm, on Wednesday, in its fourth quarter fiscal report predicted a “low double-digit percentage” decline in phone sales.
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The company, one of the primary providers of chips and modems for smartphone manufacturers, changed its earlier prediction of a mid-single-digit percentage decline in smartphone sales citing uncertainty caused by macroeconomic environments,
The predictions account for sales of 3G, 4G, and 5G handsets.
Qualcomm, in its report, shared that the decline in demand and easing of supply constraints across the semiconductor industry has resulted in elevated channel inventory for some of their largest customers. This in turn has led them to draw down their inventory impacting Qualcomm’s earlier predictions.
Two of Qualcomm’s “largest customers”, Apple and Samsung have reportedly struggled with slow sales. While Apple recently cut production of its iPhone 14 Plus model, Samsung reportedly has nearly 50 million units in unsold stock.
Qualcomm’s updated predictions indicate sluggish phone sales could continue through the holiday season. The company also shared that there is “roughly 8-10 weeks elevated inventory”, and it expects the problem to take a couple of quarters to work itself through.