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Qualcomm executives are saying that they are pleased with how well the company’s new Snapdragon 810 mobile chip is performing in the marketplace, despite the decision by a major OEM not to use the processor in its upcoming smartphone.
There are more than 60 products in the pipeline—such as LG Electronics’ G Flex 2, the upcoming LG G4 and Xiaomi’s Mi Pro Note—that will be powered by the Snapdragon 810, and Qualcomm officials said they expect even more design wins as the year unfolds.
However, despite the success, Qualcomm executives this week said that with the next version of its high-end processor, the company will move away from using ARM’s 64-bit architecture and instead return to leveraging its own custom 64-bit CPU architecture, as it has done in the past.
During a conference call Jan. 28 to discuss the company’s quarterly financial numbers, CEO Steve Mollenkopf said Qualcomm used ARM’s system-on-a-chip (SoC) design for the Snapdragon 810 to accelerate the chip maker’s adoption of 64-bit capabilities. Now that Qualcomm has made the transition, the next iteration of the Snapdragon chips will be built upon its own design leveraging the ARM architecture it has licensed.
“The use of internally designed custom CPUs has been a core part of our strategy that has worked well for some time,” Mollenkopf said on the conference call with analysts and journalists, according to a transcript on Seeking Alpha. “With the 810, we made a conscious decision to use licensed cores to accommodate the accelerated shift to 64-bit. The competitive landscape has underscored the importance of differentiation associated with our internal custom designs and, looking ahead, our next premium processor will use our own 64-bit custom CPU architecture as well as the most advanced process node.”
The CEO said the new chip, the Snapdragon 820, should start sampling in the second half of the year.
ARM designs low-power SoC architectures, which it then licenses to chip makers that can put their own technologies on top of. The ARM architecture can be found in most of the smartphones and tablets on the market, and is used by such chip makers as Qualcomm, Samsung, Texas Instruments and Nvidia.
Qualcomm officials for months have been talking about the Snapdragon 810 as the top 64-bit processor for mobile devices, and in November the company rolled out early development platforms for smartphones and tablets to encourage hardware and software makers to embrace the chip. The Snapdragon 810 leverages ARM’s big.Little architecture, which uses a combination of high-performance and low-power cores—in this case four 64-bit Cortex-A57 cores and four more Cortex-A53 cores—that offers users performance or power efficiency, depending on the workload.
However, the chip’s reputation took a hit early this year when reports came out that Samsung had decided not to use the Snapdragon 810 in its upcoming Galaxy S6 smartphone, opting instead for its own ARM-based Exynos chips due to overheating issues with the Qualcomm processor.
Qualcomm to Return to Custom CPUs for Future Snapdragon Chips
During the conference call, Mollenkopf said that a major customer had decided against using Qualcomm’s chip, but declined to say which customer it was or what the customer’s problems were.
“We now expect that our Snapdragon 810 processor will not be in the upcoming design cycle of a large customer’s flagship device, impacting our outlook for both volume and content in that device,” he said.
Despite that, Mollenkopf said he is pleased with performance of the Snapdragon 810.
“The 810 is actually doing quite well,” he said. “Any concerns about the 810 in terms of design traction really are probably limited to one OEM versus anything else.”
Mollenkopf said that along with the issue with the larger customer, other challenges the company is seeing helped reduce Qualcomm’s outlook for the second half of the company’s fiscal year, including “a shift in share among OEMs at the premium tier, which has reduced the near term addressable opportunity for our Snapdragon processors and has skewed our product mix towards more modem chipsets in this tier.”
There also is increased competition in the mid and high tiers of the market in China, which is slowing the market share gains Qualcomm officials had expected.
“This is in part due to some product challenges with one of our chips in meeting some of the more demanding design points of those tiers,” he said. “This has provided an opening to competitors who are being very aggressive in order to establish a position in the marketplace, resulting in more pricing pressure than previously expected.”
The issue of the major customer pulling back from the Snapdragon 810 adds to the hurdles. However, the CEO cautioned against reading too much into that situation. While the customer may not use a Qualcomm chip in its latest flagship device, it still has other systems in its portfolio. In addition, he noted the other 60-plus design wins for the Snapdragon 810 and said Qualcomm was about to panic.
“I don’t think we see any change in strategy, and we’re quite pleased with that device,” Mollenkopf said. “We just wish it had won one more design.”