Qualcomm Faces Potential $10.8 Billion Loss as Huawei Unveils Game-Changing New Chip
Huawei’s Resurgence: Mate 60 Series Unveils Kirin 9000S Chip
In a bold move signaling its determination to stand tall despite the challenges posed by the US trade ban, Huawei has introduced its latest flagship lineup, the Mate 60 series. What makes this announcement particularly noteworthy is Huawei’s return to its in-house Kirin silicon, specifically the Kirin 9000S chip, after a brief hiatus. This strategic shift signifies that Huawei is reducing its reliance on Qualcomm for chipsets, a move that could potentially have significant repercussions for the American chipmaker.
The Kirin 9000S’s reemergence showcases Huawei’s unwavering commitment to innovation and self-sufficiency in the face of adversity. While it may not directly compete with the most powerful Snapdragon SoCs in terms of performance and efficiency, it represents a significant step towards Huawei regaining its footing in the highly competitive smartphone market.
Despite the constraints imposed by the US trade ban, Huawei had been one of Qualcomm’s largest customers for System-on-Chips (SoCs). This fact underscores the magnitude of the setback that Qualcomm faces due to Huawei’s shift towards in-house Kirin chips. In 2022 alone, Huawei acquired up to 25 million units from Qualcomm, and in 2023, the figure soared to an impressive 40-42 million units.
Industry analyst Ming-Chi Kuo has indicated that Huawei plans to fully transition to Kirin SoCs by 2024. This transition could translate to Qualcomm losing a staggering 50 to 60 million shipments next year—a concerning prospect for the chip giant.
Adding to Qualcomm’s woes is the anticipated cost of its next flagship chip, the Snapdragon 8 Gen 3, expected to be priced at $180 per unit. Losing 60 million Snapdragon 8 Gen 3 shipments would equate to a colossal financial hit of $10.8 billion for the company.
While Huawei has not yet disclosed any intentions to offer Kirin SoCs to other Chinese phone manufacturers, such a move, if executed, could introduce competition at a lower price point compared to the rumored price hike for the Snapdragon 8 Gen 3.
It’s important to note that Qualcomm faces yet another formidable rival in the form of the Exynos 2400, set to debut in select markets alongside the Galaxy S24 lineup. With multiple contenders vying for market share, the competition in the chipset industry is intensifying.
In conclusion, Huawei’s return to its in-house Kirin chipsets marks a significant development in the technology landscape. While the repercussions for Qualcomm are substantial, this shift underscores Huawei’s resilience and commitment to technological advancement. As the smartphone market continues to evolve, the choices made by industry leaders will shape the future of mobile technology.