Qualcomm’s Cristiano Amon: ‘You have to bet the company’

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Cristiano Amon is very friendly to Apple, Broadcom, and the head of the company known for fighting antitrust enforcers from Beijing to Washington.

Born in Brazil, the 51-year-old is described as “crowd,” “passionate,” and “optimistic about everything.” His San Diego office has a life-sized cutout of an engineer, his smile and a stretched hand with his thumbs up.

Amon is the CEO of Qualcomm, the $ 192 billion designer of semiconductors whose Snapdragon chips power almost all premium Android devices. The modem provides 5G connectivity to everything built by Apple, Samsung, Xiaomi and OPPO.

I first joined Qualcomm in 1995 June CEO 2021 — Expanding beyond mobile phones to the Internet of connected cars, the Metaverse and the Internet of Things.

“5G is about creating the opportunity to connect everyone and everything to the cloud 100% of the time,” Amon said of Zoom. “And we’re seeing an acceleration in digital transformation. That’s not a buzzword. Today, every company is in the process of accelerating digital. That’s why we’re facing a semiconductor supply chain crisis. is.”

As President of the Semiconductor Unit, Amon led the development of Qualcomm’s 5G strategy. He persuaded carrier, infrastructure provider and device maker executives to accelerate launches by a year, but racing driver Mario Andretti said:

During his first months as CEO, the pandemic took a lot of his personal touch. Over the last two years, we have seen much more chip demand than our suppliers can handle. Qualcomm is called a “chip maker”, but it cannot increase production. This is because the manufacturing is outsourced to Samsung and TSMC. And GlobalFoundries.

Still, while covid is skyrocketing, Amon navigates Taiwan and South Korea quarantine to ensure a stable supply of chips from multiple sources, placing the company in a better position than its rivals in the face of chip shortages. I put it.

Working with suppliers to ensure production is a challenge for Amon’s success. Just as Apple’s Tim Cook oversaw R & D and direct investment in machines to make iPhones, Amon works with suppliers to design chips of all available capacities.

“We are pushing the boundaries of what a’fabless’company is,” he says, using the industry term for a company that designs chips but outsources manufacturing. “We are one of the few companies in the industry, and in fact, from a design perspective, we are driving the processes of the key node, the semiconductor manufacturer, making it a foundry’s preferred partner.”

His predecessor, Steve Morenkov, oversaw a long-standing conflict that gave Qualcomm a hostile image.It fought and avoided activist shareholders who wanted to split it Hostile takeover by BroadcomAnd won a serious battle with the US Federal Trade Commission over allegations that the US Federal Trade Commission imposed an “unreasonably high royalty rate” on its intellectual property.

Qualcomm has also filed an antitrust proceeding in China, paying a $ 975 million fine. And Beijing forced Qualcomm to abandon its $ 44 billion acquisition of Dutch peer NXP. Meanwhile, Apple has accused Qualcomm of fighting for years and messing up access to patents. Settle down in 2019Brings Qualcomm an increase in revenue of $ 4.7 billion.

Amon’s challenge is to overcome conflicts and relocate the company as a key supplier to the industry as it moves into the digital age. Qualcomm needs more partners than ever before, and Amon has been appointed as the smile to make it happen.

Amon’s message to investors is that as Qualcomm diversifies, the total market available to Qualcomm will increase sevenfold over the last decade.

In Metaverse, where Qualcomm is already working with Microsoft and Facebook’s parent Meta, Amon states that this opportunity “can be as big as the smartphone itself.”

In the automotive arena, we want to make sure that Qualcomm is not only manufacturing chips, but also designing a platform (“digital chassis”) that powers the automotive infotainment system and enables autonomous driving. thinking about.

He says 23 of the 26 major global automakers, including General Motors, BMW, Renault, Volvo and Honda, are partners. And in October, Qualcomm paid $ 4.5 billion to acquire Veoneer’s self-driving car software business, a Swedish auto parts maker.

Investors took time to understand Amon’s message. From January to mid-October last year, when the company announced that Amon would play its role, Qualcomm’s stock fell 17%. But by the beginning of this month, they had risen 53% to a record high after Amon showed a clever response to the supply chain crisis.

Amon compares Qualcomm’s market with the Microsoft, Amazon, and Alphabet cloud groups. “You see how valuable those companies are, and you say, why? Because you’re assuming exponential growth in the cloud as more data moves to the cloud.” He says.

“Well, where does the data come from? Who actually connects all of these different devices to the cloud? That’s us! So if you believe in that opportunity, Qualcomm’s opportunity You should believe that is the opportunity I have as CEO. “

One of the biggest risks is that Qualcomm’s Chinese clients will develop their own integrated circuit products as Beijing’s Made in China 2025 campaign aims for a semiconductor self-sufficiency of 70% by 2025. One-third of $ 33.6 billion in revenue was earned in the region.

Apple shows how clients can pull themselves away from Qualcomm. In 2019, it acquired Intel’s modem business and launched a multi-year campaign to catch up with 5G modem technology. I dropped the Intel processor and made “Apple Silicon”.

Amon says he understands the challenge. Even before becoming CEO, he coordinated a $ 1.4 billion transaction to acquire Nuvia, a startup founded by a former Apple chip architect. While Nuvia’s mission was focused on data center CPUs, Amon is shifting its focus to consumer products.

The stakes are existential. “You have to bet on the company,” he says. His dependable comparison for today’s technological competition is the ruthless world of ancient Rome. “Especially now it’s like being in the gladiator business. You go in, get ready and go to the Colosseum,” he says.

“The result can be one of three. You can win, you can lose, you can lose both. And if you win, what you have achieved is once again. Only the right to go to the Colosseum. “

The metaphor is dull, but again Amon’s friendly side stopped him pointing out that the gladiator would be killed, not just lost. “I used’losing’,” he says with a smile. “I didn’t want to say the word’die’.”

patrick.mcgee@ft.com

Qualcomm’s Cristiano Amon: ‘You have to bet the company’ Source link Qualcomm’s Cristiano Amon: ‘You have to bet the company’

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