Qualcomm Inc., the biggest maker of smartphone processors, plans to increase prices by a percentage in the double digits, a move that’s likely to ripple through much of the tech industry.
The San Diego-based company sent a letter to customers Friday informing them of price hikes, according to a copy of the document seen by Bloomberg News. The rise will go into effect for products shipped after Sept. 1, Qualcomm told clients.
The company said it had exhausted its ability to absorb higher costs from suppliers and had made attempts to secure alternative components from new sources.
Like the rest of the tech industry, Qualcomm is suffering from historic supply shortages — a crunch that is hitting everything from smartphones to supercomputers to vehicles. A massive surge in AI data center construction has placed a strain on production of memory chips and other semiconductors, but it’s also made more prosaic components difficult to obtain.
Qualcomm is one of the biggest customers of Taiwan Semiconductor Manufacturing Co., the top provider of outsourced chipmaking. It in turn is a top supplier to South Korea’s Samsung Electronics Co. and major Chinese phone makers including Xiaomi Corp. Qualcomm’s chips also are used in Meta Platforms Inc.’s wearable devices.
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Qualcomm shares, which had been down as much as 2.7% Friday as part of a broader tech retreat, reached a session high on the news — a sign investors are anticipating a boost in revenue. They were down 1.5% to $168.49 as of 12:47 p.m. in New York.
The company has suffered declining sales this year because shortages of memory chips have hurt the smartphone industry’s ability to build enough devices. Wall Street is estimating that crunch will drag on into next year.
Qualcomm, Apple Inc., Nvidia Corp. and most of the leading semiconductor designers are all trying to get more supply out of TSMC, which has said it expects shortages to continue even as it works to increase production.
The Taiwanese company has become a chokepoint for the global electronics industry, partly because would-be rivals such as Samsung and Intel Corp. have yet to convince customers that their plants are capable of producing high-end chips in the volume and quality needed.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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