A world of opportunities: Qualcomm’s expansion into emerging markets

There is one company that’s very good at capitalizing on uncharted opportunities — Qualcomm. Renowned for its work in semiconductors, software, and services related to wireless technology, Qualcomm’s maneuvers take center stage as “new” markets rise to prominence. And here’s a fun fact for you: Michelle Yeoh, the renowned actress and 1983 Miss Malaysia pageant winner, is starring in Qualcomm’s ads. So if you don’t know much about the company, there’s a familiar face you might recognize.

Without further ado, let’s go on a journey through Qualcomm’s expansion into emerging markets. Perhaps this will pique your interest enough to start trading it through Binomo.

Untapped potential in emerging markets

Emerging markets are characterized by economies in developing nations with the potential for rapid growth, and they present a golden opportunity for businesses seeking new avenues for expansion. While developed economies continue to hold significance due to their established populations, substantial middle classes, and stable demand, the prospects for consumer-oriented companies can be relatively limited in these mature markets. These regions hold allure for foreign enterprises eager to establish a presence in fertile markets. 

As emerging markets make strides in such industries as automotive, computation and data storage, and wireless technology, the demand for cutting-edge semiconductor solutions is on the rise. This is precisely where Qualcomm finds its opportunity to capitalize.

Qualcomm’s blueprint for triumph

Qualcomm is playing the business well — they’ve set their sights on the promising horizons of emerging markets like India, Brazil, and Southeast Asia. These regions hold untapped potential, and Qualcomm knows how to tap into it.

In 2021, Qualcomm’s CEO, Cristiano Amon, shared the upcoming plans at the time during a seminal investors’ meeting in New York. He unveiled a trajectory that envisioned the company’s expansion strategy to yield a sevenfold increase in its addressable markets. With projections aiming for a cumulative valuation of $700 billion within a decade, Qualcomm’s ambition to diversify and conquer is a plan to reckon with.

Embedded within this strategic framework is a focus on the fastest-growing phone markets. Qualcomm’s key regions — India, Brazil, and Southeast Asia —witness an exponential rise in smartphone proliferation and data utilization. And here, the company’s technological prowess steps in to facilitate connectivity and better performance. 

A tactic for emerging technologies

Cristiano Amon’s strategic outlook has matured over the years, as evidenced by his breakdown of addressable markets. These opportunities encompass a range of technologies, including those for handsets, RF front end, automotive applications, and IoT.

Currently, the four major avenues for Qualcomm’s growth are: 

1. Merging of mobile technology into PCs
2. Wide-reaching potential of the metaverse in various applications
3. Promise of wireless fiber
4. Opportunities within industrial IoT

Amon emphasized, “We are now diversified across many large additional markets. The time for Qualcomm is now, with one roadmap across every growth opportunity.” He added that they are longer defined by a single end market or single customer relationship.

Challenges and growth prospects

There are many factors in play, and they influence Qualcomm’s strategies and positioning within these regions. Starting with challenges, Qualcomm must navigate several intricacies to establish a strong foothold:

• Competition from local players — Emerging markets are fertile grounds for local tech companies and manufacturers that want to capture their own market share. Qualcomm faces the task of differentiating itself and showcasing the unique value it brings to these markets.
• Regulatory complexity — Regulations vary widely, which impacts the way technology is deployed and utilized in different places. This requires the ability to adapt offerings while adhering to distinct regulatory landscapes.
• Infrastructure variability — The final big headwind is that the technology infrastructure across emerging markets is a spectrum that ranges from advanced to developing. Qualcomm must tailor its solutions to work seamlessly across this spectrum.

However, you can’t ignore the tailwinds (some of them already partially discussed): 

• As smartphones become more accessible, a vast consumer base emerges.
• The company’s solutions can cater to the escalating demand for fast and reliable data transfer.
• In markets where affordability is a key consideration, Qualcomm’s prowess in providing cost-effective connectivity solutions becomes a strategic advantage.
• The rise of the IoT and the automotive sector allows Qualcomm’s technology to underpin its growth.

Taking into account the present earnings, it becomes apparent that Qualcomm harnesses growth potential more effectively than it contends with the challenges at hand.

Strategic partnerships

To truly understand Qualcomm’s positioning in emerging markets, it’s essential to delve into the company’s collaborations, which form a key pillar of its strategy.

Among these strategic alliances, the partnership with Microsoft holds particular significance, underscoring the pivotal role of cloud integration. At the investor meeting, the CEO even played a video message from none other than Microsoft’s CEO, Satya Nadella. He talked about the “wave of digital transformation” and a monumental shift from the “mobile and cloud era to ubiquitous computing and ambient intelligence.”

Other partnerships include:

• Lenovo: purpose-built edge computing infrastructure and advanced AI inferencing technology (ThinkSystem SE350 and ThinkEdge SE450 servers)
• HPE (Hewlett Packard Enterprise): AI inference (integration of the HPE Edgeline EL8000 with the Qualcomm Cloud AI 100 accelerator)
• Inventec: a high-performance solution for AI/ML inference applications (the Inventec Edge AI box)
• Foxconn Industrial Internet: design, manufacturing, and launch of the Gloria AI Edge Box
• GIGABYTE: a provider of Qualcomm Cloud AI 100 qualified server platforms
• ASUS: optimization of AI solutions for high-performance computing, AI training systems, and enterprise customers

What you can do going forward

An idea for your next step — why not take a closer look at trading Qualcomm’s asset on Binomo? This exclusive opportunity is reserved for those who hold VIP status. In doing so, you’re not just trading; you’re also getting a glimpse into emerging markets and the latest technologies, all through the Qualcomm perspective.

So, if you happen to be in the VIP club, make sure to take full advantage of it!

Sources: 

Is investing in emerging markets worth the trouble? Morning Star

Outlook on emerging markets, Lazard Asset Management

Qualcomm: Wireless Technology & Innovation, Qualcomm