What it does
The company states that it develops and commercializes technologies for on-device AI, high-performance and low-power computing, and wireless connectivity. Its platforms are used in handsets, automotive systems and internet-of-things (IoT) applications. It operates principally through QCT, its semiconductor business, and QTL, its technology-licensing business; QSI makes strategic investments. QCT supplies integrated-circuit platforms and system software, while QTL grants rights to parts of the company’s intellectual-property portfolio, including patent rights for certain wireless products. The filing also identifies nonreportable QGOV and Data Center businesses.
Source: QUALCOMM Incorporated Form 10-K for fiscal 2025, Item 1 — sec.gov
How it makes money
As reflected in the segment table below, the company reports three segments: QCT, QTL and QSI. The company states that QCT earns revenue by selling integrated-circuit products and licensing system software to manufacturers across mobile, automotive and IoT applications. QTL licensing revenue consists primarily of per-unit royalties: licensees pay quarterly based on their sales of products using the licensed intellectual property. QTL’s revenue has predominantly come from licensees’ sales of OFDMA-based products, including 4G- and 5G-enabled devices. QSI makes strategic investments, primarily in equity securities and, to a lesser extent, convertible debt instruments.
Source: QUALCOMM Incorporated Form 10-K for fiscal 2025, Item 1 — sec.gov
Customers and geography
The filing states that a small number of customers and licensees have historically represented a significant portion of consolidated revenue. In fiscal 2025, Apple, Samsung and Xiaomi each accounted for 10% or more of consolidated revenue. QTL grants licenses for cellular standard-essential patents worldwide, and its patents have coverage in countries including Brazil, China, India, Japan, South Korea, Taiwan, the United States and countries in Europe. For QCT’s supply chain, the filing says that most foundry and semiconductor assembly and test suppliers are in Asia-Pacific. Its internal RFFE-module and RF-filter front-end facilities are in Germany and Singapore, while back-end facilities are in China and Singapore.
Source: QUALCOMM Incorporated Form 10-K for fiscal 2025, Item 1 — sec.gov
Competition
The company states that QCT operates in intensely competitive industries worldwide, against U.S. and international semiconductor designers and manufacturers. The filing does not name individual semiconductor competitors. It says companies offering on-device AI, high-performance and low-power computing, or wireless-connectivity integrated circuits or software are generally competitors or potential competitors. The company also identifies competition from products developed internally by customers, including some of its largest customers. It lists performance, integration, quality, standards compliance, price, time-to-market, system cost, engineering, innovation, distribution, multiple sourcing and customer support among principal product competitive factors.
Source: QUALCOMM Incorporated Form 10-K for fiscal 2025, Item 1 — sec.gov
Key risks
The filing’s risk-factor summary identifies, among others, the following risks:
- The company derives a significant portion of revenue from a small number of customers and licensees, particularly their premium-tier handset-device sales.
- It depends on a limited number of third-party suppliers under a fabless production model.
- Security breaches or misappropriation of technology, intellectual property, or other confidential information could affect the business.
- The continued and future success of licensing programs requires evolution of the patent portfolio and renewal or renegotiation of expiring licenses.
- Adverse rulings in governmental investigations, proceedings or other legal proceedings may affect the business.
- The company operates in the highly cyclical semiconductor industry, which is subject to significant downturns.
Source: QUALCOMM Incorporated Form 10-K for fiscal 2025, Item 1A — sec.gov
People and operations
The company had 52,000 employees in fiscal 2025. Operationally, QCT uses a fabless production model for most integrated circuits, meaning it generally does not own or operate silicon-wafer foundries and relies primarily on third parties for manufacturing, assembly and most testing. The filing names Taiwan Semiconductor Manufacturing Company (TSMC), Samsung Electronics and Global Foundries as primary foundry suppliers. It also states that QCT uses internal fabrication facilities for certain RFFE modules and RF filter products. The annual report directs readers to its management discussion for seasonality information, but the supplied excerpt does not state the seasonality pattern.
Source: QUALCOMM Incorporated Form 10-K for fiscal 2025, Item 1 — sec.gov