Is mmWave Adoption Stagnating? Qualcomm’s $6B Opportunity Update, $QCOM EPS Estimates – iPhone 14, Jio, Samsung, and Meta Updates

mmWave was heralded as being able to bring incredible network throughput figures, but its adoption so far has been lackluster. Qualcomm, the leader in mmWave technology, has a front-end opportunity as high as $6B. This $6B would require the broad adoption of mmWave in Japan, China, South Korea, Europe, and India. Despite this massive opportunity, mmWave phones have been relegated to only the US market. US-only adoption for mmWave continues to ring true with yesterday’s iPhone 14announcement, but the recent Jio announcement points to a potential acceleration. We will also be sharing some exclusive details on their relationship and sales with Samsung and Meta. This includes chip-level details and what’s going on with Meta’s in-house SoC development.

Earlier this year, we reported on Qualcomm’s status with modem, transceiver, envelope tracker, PMIC, filter, and mmWave antenna design competition for this year’s and next year’s iPhones. Apple’s annual spend on connectivity was about ~$14.4B. If every iPhone shipped with mmWave, that would be ~$3B of RFFE revenue for Qualcomm. Of course, only ~44 million iPhones shipped with mmWave in 2021, while ~196 million shipped without. In 2021, Apple shipped ~240 million iPhones, with the weighted average of each phone having ~$58.3 of connectivity content per iPhone. ~44 million iPhones shipped with mmWave, whereas ~196 million shipped without. The mmWave content per iPhone represents about ~$12.10. Across Android, Qualcomm has seen as high as $18.4 content in some phones, but the average is lower. Special shout out to Sravan Kundojjala, the most detailed mobile industry analyst, for helping us ballpark some of these figures

We also scraped various countries’ websites to determine which iPhone 14 models have mmWave.

Surprise, surprise, it’s only the US model that has mmWave.

It continues to look bad for the uptake of mmWave, as many expected Japan to have mmWave. Speaking of Japan, Renesas has some interesting mmWave front-end products that could start to gain some share with MediaTek’s entrance into mmWave-capable basebands. On the flip side, there is some incrementally bullish news for mmWave adoption.

Jio, India’s hottest telecommunications company, had a huge announcement last week about investing $25 billion in 5G and mmWave. Jio launched in the 2nd half of 2016 with a modern 4G network built on concepts such as O-RAN. They have quickly accelerated to be the number 1 cellular company by 2020 with more than 400 million subscribers. Jio is why India has the lowest cost per GB of cellular data worldwide. They did this by pumping tens of billions of dollars into their network. Their investments slowed more recently, but they look to reaccelerate due to recent news.

Jio is incredibly spectrum starved. Before recent auctions, the same was often said about Verizon in the US. They are the largest deployer of mmWave in the world. Interestingly, if we look at the number of customers or data volume per MHz of low and mid-spectrum, Jio is the leader. Mobile data consumption in India is growing incredibly rapidly, and Jio is running into a brick wall in network capacity. They need to acquire more low and mid-band spectrum or turn to mmWave.

Jio acquired a significant chunk of the 700MHz spectrum recently, but they have also chosen to embrace mmWave with open arms where spectrum is plentiful and cheap. They are going to install 5G in 1,000 cities in India. This includes using mmWave small cells to offer orders of magnitude more network capacity with a target of 100 million fixed wireless internet home connections.

With Jio’s massive $25B investment, India looks poised to start adopting mmWave on the high end. Qualcomm owns the high-end. It seems clear that from 2023 to 2025, mmWave will begin deployment in India, Japan, and South Korea. We are still unsure of China’s plans for mmWave, with our opinion oscillating between it happening and not happening almost weekly.

We also want to talk about Qualcomm’s stock. It’s beaten back, with mobile industry sales having slowed significantly, which has prompted our consulting clients to ask for deeper dives on the stock. This was not exclusive work, so we can share a snippet of what we have here regarding revenue and EPS estimates for the next couple of years. We also have some commentary on some business units, including exclusive details on Samsung and Meta relationships and future SoCs.

SemiAnalysis is a boutique semiconductor research and consulting firm specializing in the semiconductor supply chain from chemical inputs to fabs to design IP and strategy.

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