What Will Happen to Qualcomm's Chipmaking Business?

Qualcomm (NASDAQ: QCOM) is the world's largest mobile chipmaker. Sales of its flagship Snapdragon SoCs (system on chips) generate most of its revenue, but the chipmaking (QCT) business faces tough headwinds over the next few years. Let's examine those challenges, and see how Qualcomm plans to counter them.

Over the past few years, Qualcomm lost market share to Taiwanese chipmaker MediaTek, which initially aimed for the low-end market with its cheaper ARM-based SoCs with integrated 4G modems and GPUs. MediaTek subsequently targeted the high-end market with its Helio chips, which were promoted as cheaper alternatives to Qualcomm's top-tier Snapdragon chips.

A Snapdragon 835 compared to a penny. Source: Qualcomm.

Source: Fool.com