US chipmaker Qualcomm has set up a unit in Shenzhen to give domestic handset vendors support in marketing their devices abroad.
The moves comes just two months after the San Diego-based company, which made $7.57 billion last fiscal year in royalties from licensing patents and other IP, was fined CNY6.088 billion ($975 million) by China’s antitrust regulator and agreed to modify its licensing practices.
Qualcomm CEO Steve Mollenkopf told the Wall Street Journal that “more customers in China have shown willingness to sign licensing agreements” after it resolved the anti-trust case and reduced its royalties.
The company is working to build its ties with Chinese device makers as it faces rising competition from Asian semiconductor firms. It recently downgraded its full-year revenue guidance by $1 billion. Its fiscal Q2 net profit fell 46 per cent to $2 billion, mostly due to the fine.
It has been hit by both Apple and Samsung opting not to use its chips as the main processor in their latest devices. Samsung also reportedly replaced the US company as its modem supplier.
Qualcomm is looking to ride the wave of success of fast-rising Xiaomi as well as more mature players like Lenovo and Huawei, which increasingly are targeting overseas markets, but have faced challenges as they attempt to expand outside of China.
Qualcomm has set up a “globalisation” office to help smartphone makers tap into export markets, the Journal said.
The company also has been investing in Chinese technology firms, announcing last December it put $40 million in four Chinese mobile technology companies via its $150 million China strategic venture fund.
The four companies are 7Invensun, a maker of eye-tracking technology; Chukong Technologies, a mobile entertainment platform provider; inPlug, a ‘smart home’ device/platform provider that develops virtualised networks using software defined network software; and Unisound, a maker of voice-recognition technology.
Qualcomm said part of the investment also will go to China Walden Venture Investment fund, which invests in semiconductor related firms.