Thanks to Chinese companies, Qualcomm's profits are higher than Apple's
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Just as the National Development and Reform Commission was gradually determining that Qualcomm was suspected of monopoly in China, Qualcomm's financial report showed that its 32% net profit was astonishingly high, making it easier for Apple to make money; moreover, more than 80% of the net profit came from licensing and patent fees, and more than half of the licensing and patent fees came from Chinese companies, which has aroused great concern from the Chinese industry to Qualcomm. Whether it has harmed the Chinese industry, even people outside the industry can judge. Qualcomm's high net profit margin is rare in the world. According to Qualcomm's latest third-quarter financial report for fiscal year 2014, Qualcomm's third-quarter revenue was US$6.81 billion and its net profit was US$2.24 billion. From this, it can be calculated that Qualcomm's net profit margin is 32%. The day before, Apple also released its latest quarterly financial report. The report showed that Apple's third-quarter revenue was US$37.432 billion and its net profit was US$7.748 billion. From this, it can be calculated that Apple's net profit margin is 20%. In fact, companies like Apple with a net profit margin of 20% are rare, and Microsoft and IBM are far behind. But compared with Qualcomm, Apple's net profit margin is not high. From the reaction of the investment banks, it can be seen that Apple's performance in this quarter has worried Wall Street, because Apple's sales and profit growth have slowed down significantly, while Qualcomm's net profit margin in this quarter increased by 42% compared with $1.58 billion in the same period last year. Such net profit even far exceeded the expectations of Wall Street analysts. 84% of net profit comes from licensing and patent fees. From the composition of Qualcomm's net profit, it is also shocking, because Qualcomm's revenue from licensing and patent fees in this quarter was $1.884 billion, and licensing and patent fees are almost free of cost. Mobile phone companies have to pay licensing and patent fees for every mobile phone they sell. In other words, after adding and removing the licensing and patent fees of $1.884 billion, Qualcomm's net profit in this quarter will only be 360 million yuan, and the net profit margin is 5%. It seems not high, but this is actually the profit margin of most chip companies in the world, which is not low. It can be seen that Qualcomm's net profit margin is too high, and it is caused by licensing and patent fees. Because of this, Qualcomm held a total of $32.7 billion in cash, cash equivalents and marketable securities at the end of the third quarter. Such a large amount of cash and cash equivalents is rare among global companies, and it can be said to be as rich as Apple. Qualcomm is "optimistic" about China's 4G chip patent fees. What have Chinese companies contributed to Qualcomm's net profit margin? According to Qualcomm's financial report, half of Qualcomm's revenue comes from China; moreover, China has the largest number of mobile phone companies in the world, and its production accounts for more than half of the world's total. This shows the proportion of licensing and patent fees paid by Chinese companies to Qualcomm. Even so, at the investor conference held by Qualcomm in November 2013, Qualcomm executives also emphasized that the Chinese market and the upcoming LTE in China are great opportunities to increase sales of smartphone chips, and with the adoption of LTE, Qualcomm will obtain a new source of patent fee income. But it is clear that patent fees have stimulated Chinese mobile phone companies and the National Development and Reform Commission. At present, China's three major operators have all achieved 4G commercial use. 4G mobile phones will greatly increase sales. Among them, TD-LTE is considered to be China's independent intellectual property, but it still faces the risk of paying patent fees to Qualcomm. This makes people question who owns the TD-LTE patent? Moreover, what is the basis for Qualcomm's patent fees and when will they be collected? "Qualcomm's net profit margin is 32%, while China's mobile phone manufacturers generally have a net profit margin of only 1% to 5%, and many are still in a loss-making state. The contrast between the two is too great," said a mobile phone manufacturer. As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity. |
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