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Qualcomm (QCOM) Boosts 5G RF Demand With GlobalFoundries Tie-Up

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Qualcomm Incorporated’s (QCOM - Free Report) unit, Qualcomm Global Trading PTE. Ltd., has inked an agreement with chipset manufacturer GlobalFoundries (“GF”) to manufacture state-of-the-art 5G multi-gigabit speed RF front-end products owing to their increasing demand. The entities have extended their RF collaboration to offer high cellular speeds supported by maximum power efficiency and enhanced coverage in the sleek form factors.

At a time when foundries are raking up the prices of semiconductor chips amid a global supply crunch, tech giants are devising ways to design and develop devices within a budget to preserve supply for its customers. Hence, Qualcomm’s alliance with GF to redefine semiconductor manufacturing innovation with highly differentiated solutions is likely to be a fruitful one in augmenting 5G connectivity in this dynamic digital era.

Qualcomm and Malta, NY-based GlobalFoundries have been sharing an active working relationship for quite some time now. Their partnership involves investing in advanced mmWave technology and sub-6 GHz for a seamless access to 5G, driven by unrivalled data speeds. This will help in better serving the accretive networking requirements of specific products and industry verticals such as 5G-enabled smartphones, automotive and data centers, to name a few.

Qualcomm’s shares have gained 20.4% compared with the industry’s growth of 26.6% in the past year.

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Per the extended alliance, the San Diego, CA-based tech behemoth and GF aims to boost the demand for RF front-end products by continuing the supply of sturdy low-power semiconductor solutions. These innovative offerings are specifically designed to power 5G-enabled connected devices with revolutionary coverage and ubiquitous mobility.

Backed by such dedicated efforts, the partnership is likely to highlight GF’s leadership in the RF-specific, feature-rich foundry solutions space, while addressing the high-performance requirements of Qualcomm’s 5G products by catalyzing innovation in IoT and automation.

Moving ahead, Qualcomm will remain focused on helping customers experience seamless transition to superfast 5G networks with low-power resilient multi-gigabit connectivity. The company anticipates witnessing healthy growth momentum, driven by the ramp-up in 5G-enabled chips and higher demand for digital transformation in the cloud economy.

Healthy traction in EDGE networking, as well as robust automotive telematics and connectivity platforms, are fueling the emerging automotive industry trends. Qualcomm is focused on retaining its leadership in 5G, chipset market and mobile connectivity with several technological achievements and innovative product launches. This bodes well for its long-term growth proposition.

Zacks Rank & Other Stocks to Consider

Qualcomm carries a Zacks Rank #2 (Buy).

Other top-ranked stocks in the industry are Clearfield, Inc. (CLFD - Free Report) , Aviat Networks, Inc. (AVNW - Free Report) , and InterDigital, Inc. (IDCC - Free Report) . While Clearfield sports a Zacks Rank #1 (Strong Buy), Aviat Networks and InterDigital carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Clearfield delivered a trailing four-quarter earnings surprise of 49%, on average.

Aviat Networks delivered a trailing four-quarter earnings surprise of 41.8%, on average.

InterDigital delivered a trailing four-quarter earnings surprise of 536%, on average.