The next wave of smartphones may come with a higher price tag for more than one reason. Beyond the ongoing RAMageddon squeeze, Qualcomm is preparing to raise prices across its processor lineup. CEO Cristiano Amon said Wednesday that “prices are going to go up” for the company’s products beginning September 1st, according to CNBC. Reports last week suggested the increases could land in the double-digit percentage range.
The pricing move comes as Qualcomm’s handset business faces mounting pressure. The company reported a 20 percent year-over-year decline in revenue from that segment, its weakest result since 2021. In its quarterly earnings materials, Qualcomm blamed the downturn on “unprecedented increases in memory pricing and supply constraints,” the same forces pushing up costs for game consoles, laptops, Raspberry Pi boards, and other electronics. Rather than absorb the hit to margins, Qualcomm says it plans to offset the pressure by increasing its own prices.
The company is also bracing for a sharper decline tied to Apple. Qualcomm said its “modem share for the upcoming iPhone launch is expected to be materially lower,” signaling that Apple-related revenue will fall faster than before. During the earnings call, executives indicated more than once that growth in other parts of the business should help fill the gap.
As smartphone sales become a smaller piece of the company’s story, Qualcomm appears to be reshaping itself around three major pillars: handsets, data centers, and automotive technology. The company said Wednesday that phones will soon account for only about half of total revenue, and by 2029, that share is expected to shrink to roughly one-third as its data center and automotive divisions expand.
That shift is already taking shape. Qualcomm announced Wednesday a 10-year agreement to supply chips to BMW, underscoring its push deeper into the auto market. Meanwhile, Qualcomm EVP, CFO, and COO Akash Palkhiwala said some device makers are responding to rising component costs by turning to “prior generation” Qualcomm chips for new products.
