Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: slacker711 who wrote (41298)	6/26/2004 11:55:09 PM
From: Jim Mullens	Respond to of 196973

Slacker, Re: RBC report of CDMA semi component weakness, and- “The essence of your argument boils down to the fact that if it isnt confirmed by Qualcomm that it cant possibly be true.”<<<< No, not at all! Virtually all data points, excepting some remarks from the “analyst” community , are at conflict with the subject article. Again, I found the report “strange” in that out of the entire Semiconductor sector which it reported to be strong going into the second half of the year, it singled out wireless as the only area of weakness ("Wireless forecasts are weak going into 2H:04”),...“particularly CDMA”. And, it appeared to extrapolate such on a single data point- forecast data from SAT (semiconductor assembly and test) for wireless components in Taiwan and Singapore. I found it strange that wireless in general and CDMA in particular would be weak in 2H04 based on the following data points - 1. Virtually everything I’ve been reading the past several months indicates that wireless is booming, particularly CDMA. 2. The most recent (somewhat aged) QCOM RBC capital report which sited robust strength in CDMA is in direct conflict with the article and without an update expressing this significant change, the analyst would be derelict in his duty. 3. Robust sales reported by the carriers in the U.S., Korea, and Japan 4. Robust sales / forecasted sales by the handset manufacturers in the U.S., Korea, and Japan (virtually all but Nokia). 5. Articles discussing the positives on WCDMA in Europe and Japan. 6. Articles discussing Dual Mode handsets sales in 2H04 in China, etc. 7. Articles discussing the robust uptake of feature rich (camera) phones and the high upgrade cycle. 8. Positive articles on CDMA450. 9. The fact that the 2nd half of the CY is the strongest for wireless components due to Christmas season production. 10. The fact that QCOM’s chipsets sales have been so robust, they are outstripping demand and on allocation. These reports have be discussed at length in the Korean press and by analysts in addition to Qualcomm. 11. Qualcomm’s recent handset guidance for 2005 reflecting over 30% growth. 12. And, Qualcomm’s recent presentations this past week by TT which mentioned nothing of any weakness in 2H04. In the face of all of this I questioned the article as “strange”, and you thought it “strange” that I would do so. I find it kinda “strange” that one familiar with the industry would not also view the subject article as presenting a data point at odds/ inconsistent/ an anomaly to common thought ( “strange”). The report might have had shed more light on the subject if it had named the particular components and if those included the high value semi components such as baseband chipsets. I suppose that it’s not impossible that a few companies in two countries could be reporting weak forecasts for some wireless semi components. Information statusing the condition at the lower levels of the value chain can be the first indicator of what’s to follow up that chain, but too small of a data point taken out of context of the much larger data universe can lead to false conclusions. Perhaps a more simple explanation has to do with chipset integration. Again, as more components are being integrated on the baseband chipset itself (Qualcomm’s /CDMA especially), it is entirely possible that there may be fewer separate components arriving at these SATs. If this be the case, RBC and the SATs should have offered that as an explanation, rather than extrapolating the SATs weakening business as an indicator of overall weakness in the wireless semi industry. Again, I always appreciate your valued contributions to this thread and generally consider all POV on wireless pertinent. Articles presenting a contrary POV can be of great value to us all, especially if well founded and documented. However, if I find something that appears “inconsistent” (“strange”), I would not be acting inconsistently (“strange”) in challenging it. (gg).