Mobile Chip Giant QUALCOMM Downsizing In China And Taiwan Amid Lingering Industry Challenges: Report - Qu

QUALCOMM Incorporated (NASDAQ:QCOM) is reportedly slashing hundreds of staff in China and Taiwan, signaling a longer-than-expected industry downturn and slow recovery.

The mobile chip manufacturing giant is downsizing the workforce at its research center in Shanghai, according to a report by Nikkei Asia, citing several posts by employees on local social media.

The company's third-quarter results, reported last month, lacked luster, with revenues falling 23% year-over-year amid recent headwinds in the global smartphone market.

QUALCOMM also plans to cut staff in Taiwan, particularly for chip testing, quality assurance, and engineering positions, the report read.

The company told some workers that they could "voluntarily" quit or be terminated afterward, according to a document seen by Nikkei Asia.

QUALCOMM told Nikkei Asia the layoffs are in line with previous announcements.

QUALCOMM is confronting competitive challenges from Huawei Technologies Co, Ltd, which unveiled its Mate 60 Pro featuring a fresh 7nm processor.

With this advancement, Huawei might be poised to reclaim its top market spot, putting QUALCOMM at risk of this shift, especially if Huawei can adeptly leverage SMIC's 14nm and 7nm production processes and R&D team to enhance technological prowess and production efficiency.

However, QUALCOMM's latest three-year pact with AAPL may instill confidence in investors, as last year, Apple Inc's (NASDAQ:AAPL) modem buys accounted for 16% of Qualcomm's earnings – that's $7.26 billion.

Price Action: QCOM shares are trading higher by 0.57% premarket to $108.57 on the last check Friday.

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