The Qualcomm R&D facility in Shanghai, China opened in 2010 and employs nearly 400 staff
While Qualcomm has denied rumors that it plans to shut its Shanghai R&D facility or enact “large-scale” layoffs in China, it did reveal that will reduce the facility’s staff, citing weak demand for smartphones and the country’s slowing economy.
The Shanghai facility opened in 2010 and employs nearly 400 staff. The chip company told Chinese news outlet Yicai Global that the impact won’t be much of a cut, but instead, more like a job trim. Most of the layoffs, said Qualcomm, will occur this quarter and the rest will follow over the next six months.
China is experiencing ongoing slump in smartphone demand, and more pointedly, the government has banned its officials from using Apple’s iPhone, with further reaching bans rumored — although not confirmed — threatening to greatly impact Qualcomm, which supplies iPhone modem chips.
Further, U.S. sanctions restricting the sale of advanced chips in China have also affected Qualcomm’s business as its major Chinese customers such as Huawei and ZTE have been forced to cut orders.
“As time moves forward, the U.S. ban means Chinese companies like Huawei and ZTE are forced to find new ways to meet their own needs,” wrote Analyst Jeff Kagan. “Since Huawei can’t do business with Qualcomm any longer, they are finding other ways to meet their needs with 5G chips and HarmonyOS, which replaces Google Android.”
Qualcomm also has an R&D facility in Beijing, and offices in more than 12 Chinese cities.
