After Xiaomi, Qualcomm’s Snapdragon Chipset Powers One Plus Smartphones

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Leading mobile chipmaker Qualcomm’s (NASDAQ:QCOM) Snapdragon 810 will power One Plus One’s forthcoming flagship One Plus 2 smartphones. The company said that the Snapdragon 810’s unmatched speed and ability to multitask while maintaining battery performance had them coming back to it over and over again during their search for the right processor. The Chinese startup is, however, using a newer version of the SoC, to avoid the heating issues involving the first generation Snapdragon 810. Last month, Xiaomi, another popular Chinese smartphone maker, said it had worked with Qualcomm to create a customised v2.1 of the Snapdragon 810 processor, or the third edition of the SoC, to optimize it for the Mi Note Pro. (Read Here)

Qualcomm’s Snapdragon 810 processor was announced back in April of 2014. It has been in the news on overheating and other issues as far back as December, a month before it was launched in its first phone – the LG G Flex2 at CES 2015. Qualcomm since that time has done its best to rebut these reports, but LG itself arranged for a fix. The issue with overheating is that it causes the processor to lower performance, which is particularly noticeable in gaming. Moving away from Qualcomm’s previous issues, this processor will be matched with a custom version of OxygenOS optimized specifically for this processor. Leveraing the chpset’s  eight processor core design, it will assign different tasks to different processors, using the larger processors for heavy tasks and the smaller processors for light tasks. Plus it’s designed not to use processors next to each other. All this should mean great performance.

After Xiaomi and now One Plus 2, Qualcomm has once again proved that the company is continuously striving towards better designs with the best of technology. This another big win can help the company gain a competitive position in the market after being hit by Samsung. In January 2015, reports began to surface that Qualcomm’s upcoming flagship system-on-chip was experiencing overheating problems. And, as a result, Samsung pulled out of using Snapdragon 810 for its soon-to-be released flagship, the Galaxy S6, instead opting for its own Exynos 7420 processor. [1]

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Qualcomm recently provided guidance on how rapidly smartphones have penetrated the market. The future is mobile (shipments of more than 8.5 billion cumulative smartphone units are forecast between 2015 and 2019). The company said that the smartphone technology is expanding its reach in an unmatched scale into a wide spectrum of sectors and products such as automotive, mobile computing, smart cities, healthcare, wearables, smart homes, etc. The company is fueling major technology shifts in the industry by anticipating the big challenges and investing early on to develop solutions. [2]

Our price estimate of $71 for Qualcomm is almost in line with the current market price. For fiscal year 2015, we estimate the company to report revenue of $29 billion and net income of $8.1 billion. Also, our non-GAAP EPS estimate is $4.70 as compared to the market consensus of $4.79.

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Notes:
  1. Samsung’s Galaxy S6 Gamble Is Damaging Qualcomm, Forbes, January 28th, 2015 []
  2. Qualcomm bets big on mobile technology, The Times Of India, June 6th, 2015 []