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Qualcomm Drops on Report Apple Will Use Own Chips by 2023

Apple's 5G chip is currently in development and could be used as soon as 2023, a media report says. Qualcomm shares are lower.
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Shares of Qualcomm  (QCOM) - Get QUALCOMM Incorporated Report and other other Apple  (AAPL) - Get Apple Inc. Report suppliers were dropping Monday after a media report said Apple's 5G baseband chip could be used in the iPhone as soon as 2023. 

AppleInsider cited TF International Securities analyst Ming-Chi Kuo in making its prediction. Kuo sees Qualcomm having to change its strategy to combat order losses from Apple. 

“As Android  (GOOGL) - Get Alphabet Inc. Report sales in the high-end 5G phone market are sluggish, Qualcomm will be forced to compete for more orders in the low-end market to compensate for Apple’s order loss,” Kuo said, according to AppleInsider.

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Meanwhile, Bloomberg Intelligence analyst Anand Srinivasan said that while Apple's reported 5G chip progress hurts sales for Qualcomm's chip-technology segment, it will not hurt its royalty revenue. 

Qualcomm shares at last check dropped 4.7% to $131.32. 

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Other chipmakers were also weaker Monday with Nvidia  (NVDA) - Get NVIDIA Corporation Report falling 2.%9, Advanced Micro Devices (AMD) - Get Advanced Micro Devices Inc. Report off 2.6%, Broadcom  (AVGO) - Get Broadcom Inc. Report down 2.1% and Micron Technology  (MU) - Get Micron Technology Inc. Report giving up 5.2%. 

Two weeks ago, Qualcomm reported fiscal-second-quarter results that topped estimates. 

The San Diego chipmaker reported earnings of $1.90 a share as revenue rose 52% from a year earlier to $7.93 billion. 

Analysts were expecting earnings of $1.67 a share on revenue of $7.62 billion, according to FactSet.

The figures were "driven by sustained demand for smartphones globally and our ability to increase the scale of our non-handset revenues,” Chief Executive Steve Mollenkopf had said in a statement.

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