(Corrects surname of former CEO to Jacobs, not James)
By Noel Randewich
SAN FRANCISCO, March 4 Steve Mollenkopf, the new
chief executive of Qualcomm, said on Tuesday that the
mobile chipmaker is developing technologies that will drive
continued demand for smartphones even as others worry that the
smartphone market's best days are behind it.
Mollenkopf, 45, who was previously chief operating officer,
officially took over as chief executive officer at the company's
annual shareholders meeting on Tuesday. He was named in December
to replace Paul Jacobs, the son of a Qualcomm co-founder.
"A lot of people talk about the fact that everyone has a
smartphone. That's true to some degree in some parts of the
world, but the world is a big place and there are a lot more
smartphones coming," Mollenkopf told the shareholders meeting.
Qualcomm's shares have underperformed the S&P 500 for the
past 12 months as smartphone demand shifts from the United
States and other developed countries, where top-tier phones like
the iPhone have become ubiquitous, to China, where consumers
tend to buy less expensive devices with lower-end displays and
Mollenkopf pointed to wireless connectivity, cameras,
sensors and audio as key smartphone technologies Qualcomm is
improving and which he said will help drive demand.
"We're working on technologies that emulate how the brain
processes information. Ultimately, I think you get to the point
where the phone becomes an extension of all of your senses,"
After increasing 39 percent last year, smartphone shipments
are expected to expand by 19 percent in 2014, and growth is
expected to continue to slow, falling to just 6 percent in 2018,
according to market research firm IDC.
China's local market is becoming increasingly important for
Qualcomm as China Mobile, the world's largest wireless
carrier, rolls out an advanced network this year based on
technology the U.S. chipmaker effectively dominates.
But Mollenkopf, who joined Qualcomm in 1994 as an engineer
and was named chief operating officer in 2011, also faces an
antitrust investigation in China that may affect future
licensing revenue from smartphones made there.
China's country's competition regulator said in February it
suspected Qualcomm of overcharging and abusing its market
While most of Qualcomm's revenue comes from chips that allow
phones to communicate with carrier networks, most of its profit
comes from licensing patents for its CDMA cellphone technology -
a component in new fourth-generation mobile phones.
Also on Tuesday, Qualcomm raised its dividend by 20 percent
and upped its share repurchase authorization by $5 billion to
Shares of Qualcomm rose 3.74 percent to $76.38 following
after the company announced its dividend increase.
(Reporting by Noel Randewich; Editing by Leslie Adler)