strategy group9 section f qualcomm

8/2/2019 Strategy Group9 Section F Qualcomm

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Presented by Group-9 Section-F

D Naveen PGP27350M Abhinandan PGP27367Satyajeet Jaiswal PGP27377Satyanarayana Murthy PGP27378


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Introduction and Company Background

A US fortune 500 company and world leader in 3G and nextgeneration mobile technologies

A fab-less semi-conductor company

Holds more than 12,600 patents for CDMA and relatedtechnologies

Head Quartered in San Diego USA with an employee base of16,100 highly skilled professionals and spread across 146locations worldwide

Annual revenues of over USD15 Billion and profits of overUSD 4 Billion

A major chunk of its revenues come from China, Japan,Korea and Taiwan


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Year Activity

1985 Company Founded

1989 First CDMA call

1990 Designed CDMA base stations

1992 Manufacture of CDMA mobile, base stations and chipsets

1995 CDMA made as cellular standard

1996 Launches CDMA technology Licensing providing complete range of CDMA

solutions

1999 CDMA selected as 3G Standard

1999 Divestmentof CDMA base stations and Mobile manufacture

2005 Scorpion processor brings consumer electronic features to mobile

2007 Worlds largest mobile chipset provider2007 First Windows mobile launched

2008 World CDMA patents reaches 12000+

2008 Breakthrough to First Android based mobile phone through its chipset

2009 Worlds CDMA subscribers surpass 500 million

2010 Worldwide 3G connections surpass 1 billion


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QualcommDifferent divisions

QualcommIncorporated

QualcommCDMA

Technologies

Segment(QCT)

QualcommTechnology

LicensingSegment(QTL)

Qualcomm wirelessand Internet

Segment(QWI)

Qualcomm InternetServices(QIS)

QualcommGovernment

Technologies(QGOV)

Qualcomm Enterpriseservices(QES)

Qualcomm StrategicInitiatives(QIS)

Qualcomm VenturesStructured Finance &Strategic Investments


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Generic Strategies followed by differentCompanies

Overall Low-cost

Provider Strategy

Broad Differentiation

Strategy

Focused Low-cost

Strategy

Focused Differentiation

Strategy

Best Cost ProviderStrategy


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Qualcomm-Business StrategyBroad Differentiation (2/2)


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Effects of Qualcomms Strategy

Increased revenues to Qualcomm through its extensive portfolio licensing

Development of entire wireless ecosystem

Reduction in the costs of average and low end selling prices for 3G handsetsand other wireless devices


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Results of Qualcomms strategy (1/2)

0

2

4

6

8

10

12

14

16

2008 2009 2010 2011

Revenue

Net Income

0

0.1

0.2

0.3

0.4

0.5

0.60.7

2008 2009 2010 2011

EPS

01000

2000

3000

4000

5000

6000

2011 2010 2009 2008 2007

Royalty earned fromLicensing in million$

Revenue


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Results of Qualcomms strategy (2/2)

Ratios for

2011

Company Industry S&P 500 Remarks

Current Ratio 2.8 1.8 1.6 Healthy Balance Sheet andgood Financial Strength

GrossMargin(%)

70.4 39.9 46.9 Huge profit reapingproducts

ROA 11.9 4.5 3.1 Excellent Management

P/E ratio 23.8 25.4 17.7 Strong Investor Confidence

Revenue/Employee ( in $)

768679 352064 449376 Excellent Efficiency byemployees


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Routes used by Qualcomm to gainCompetitive Advantage under Broad

Differentiation

Improvements that raised product performance

Delivering value by differentiating on the basis ofcompetencies and competitive abilities that rivals don'thave


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Reasons for Success of Qualcomms Strategy

Highly skilled and competentworkforce

Patent portfolio enablingsuccessful product

implementations

Internal

Fast paced technological changes

Rapidly evolving productfeaturesExternal


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Challenges to Qualcomms Strategy

Much of Qualcomms revenue is from its relatively cheaper

Integrated circuit chips that are used in radio and theapplication processors

These cheaper chips will be threatened when companiessuch as MediaTek(which focuses on low cost strategies)mature


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Thank you

strategy group9 section f qualcomm

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