Pay Attention to Qualcomm

Qualcomm actively pursues more than 24,000 patents and already holds 140,000 global patents, which form the core competitiveness of the company. They operate an integrated patent and chip business, meaning that just purchasing a Snapdragon chip requires agreeing to the corresponding patent license. This is a strategy that distinguishes them from other companies, securing two revenue streams at the same time.

Profits from patents alone are sweet

• Performance of the patent licensing business: In 2023, the Qualcomm Technology Licensing (QTL) division recorded $5.3 billion in revenue and $3.6 billion in profit, achieving a high margin of 68%. This figure accounts for nearly half of Qualcomm's total net profit.
• Achievements in a competitive industry: Qualcomm achieves an average profit margin of over 29%, significantly exceeding the industry average of 22.74%. This is a remarkable achievement in the highly competitive semiconductor industry.
• Dispute with Apple: Qualcomm pursues an aggressive litigation strategy regarding patent infringement, which was also evident in its two-year legal battle with Apple. This strategy further solidifies their strong position in the market.
• Technological superiority and legal response: Qualcomm's strategy suggests that substantial technological superiority and readiness for legal action are essential. Their technological lead is at a level that competitors cannot easily catch up with.

Does NVIDIA come to mind?

Qualcomm's case shows how technological superiority and innovative patent strategies can significantly enhance a company's profitability and market position. From mobile chipsets represented by Snapdragon to its recent unrivaled position in wireless communication technologies (LTE, 5G), Qualcomm and NVIDIA—which excels in high-performance computing—operate in different fields, but both are companies that have established their positions by effectively linking technological superiority to patents.

Category | NVIDIA | Qualcomm

Key Business Areas | Graphics Processing Units (GPUs), Artificial Intelligence (AI), Data Centers | Mobile Chipsets, Wireless Communication Technology (especially 5G), Internet of Things (IoT)

Characteristics | - Strength in developing high-performance graphics cards
- Provides GPUs used in gaming, professional graphic design, data centers, AI, and machine learning
- Also used in cutting-edge technologies such as autonomous driving vehicles | - Strength in manufacturing chipsets for mobile devices
- Develops processors and modems used in smartphones, tablets, wearable devices, etc.
- Strength in wireless communication technologies and patents, leading 5G technology

Innovative Patent Strategy | - Securing new patents in virtual reality, AI, and machine learning alongside GPU technology innovation
- Securing patents related to autonomous vehicles and robotics technology | - Extensive patent portfolio on 3G, 4G, and 5G wireless communication technologies
- Holds fundamental technology patents for chipsets used in mobile terminals
- Securing chipset-related patents applied to IoT and home appliances