TECH

Qualcomm to raise prices starting in September, and MediaTek is loving it...

Qualcomm has confirmed that all its products, including the upcoming Snapdragon 8 Elite Gen 6 Pro, will become more expensive starting next month. This hike opens a window of opportunity for MediaTek, which—according to supply chain rumors—could sell the Dimensity 9600 Pro to manufacturers for significantly less money...

Qualcomm confirmed that, effective September 1st, all its products will undergo a "double-digit" price increase, citing rising costs from its suppliers. The hike also applies to the Snapdragon 8 Elite Gen 6 Pro, the flagship chipset the company is preparing to launch later this quarter. It is worth noting that this chip was already expected to be the most expensive ever for the mobile market due to its complexity and the fact that it is one of the first chips to utilize TSMC’s 2-nanometer N2P manufacturing process.

The latest confirmation of the price hike did not come as a standalone announcement but was instead part of Qualcomm's third fiscal quarter earnings report, released yesterday after market close. The company reported revenue of $9.9 billion—surpassing market estimates of $9.67 billion but still falling short of the $10.37 billion recorded in the same quarter last year. Adjusted earnings per share stood at $2.21, slightly below the estimated $2.23.

The smartphone (handset) chip segment generated $5.1 billion—a 20% year-over-year decline—which the company attributes to softening demand in the Chinese market. In contrast, the automotive segment continues to grow strongly, bringing in $1.59 billion (up 61% from a year ago) and marking the 23rd consecutive quarter of double-digit growth in this area. For the fourth quarter, Qualcomm anticipates total revenue between $9.70 billion and $10.50 billion.

The reaction to this announcement was somewhat guarded, especially given the ongoing supply crunch for memory chips. It was alongside these results that CEO Cristiano Amon reaffirmed the price hike taking effect on September 1st, framing it as part of Qualcomm's broader effort to expand margins. However, the most telling statement came when Amon acknowledged that current market dynamics are making low- and mid-range smartphones less competitive due to pricing.

This statement was accompanied by another revealing that even in the premium segment—where Qualcomm has historically dominated—customers are opting for cheaper choices within that same tier, including chips from previous generations. It is this admission from Qualcomm's CEO himself that makes the threat posed by MediaTek particularly credible, especially as market preference shifts toward the more affordable end of the high-end spectrum.

Worst possible timing...The timing of Qualcomm's price hike could not be more inconvenient for smartphone manufacturers, who have been grappling with steadily rising costs for RAM and NAND storage for over a year. Now, TSMC's 2-nanometer wafers are also set to cost significantly more than previous generations. Consequently, Qualcomm's announced price increase will compound a bill that was already ballooning due to costs from other areas.

According to supply chain estimates, the Snapdragon 8 Elite Gen 6 Pro could cost manufacturers over $300 per unit—a figure that, on its own, could account for roughly one-third of a high-end smartphone's total production cost. This is where MediaTek may find an opportunity. According to the Taiwanese business newspaper *Commercial Times*, the Dimensity 9600 Pro—a direct rival to the Qualcomm chip, both manufactured using TSMC’s 2-nanometer process—will sell for approximately $216 per unit; this represents a difference of about 28% compared to the price tag of over $300 commanded by Qualcomm. It is worth noting, however, that this information has not yet been officially confirmed by either company.

This price disparity is nothing new in the relationship between the two brands. The current Dimensity 9500, for instance, costs between $180 and $200 per unit, compared to the roughly $280 charged for the Snapdragon 8 Elite Gen 5. In other words, even if these projected figures prove accurate, MediaTek’s strategy of positioning its flagship chips at a noticeably lower price point than Qualcomm’s is hardly a novelty.

What this could mean for 2026/2027 smartphones...With Qualcomm's price hikes already confirmed and a cheaper rival waiting in the wings, smartphone manufacturers now face a tougher choice than in previous years. Major market players are expected to stick with the Snapdragon 8 Elite Gen 6 Pro for their priciest "Ultra" models, despite the higher cost.

However, smaller brands—or models positioned just below the absolute flagship tier—now have a stronger financial incentive to lean toward the Dimensity 9600 Pro or even Samsung's upcoming Exynos 2700, which will benefit from Samsung Foundry's second-generation 2-nanometer process. This could translate into faster adoption of non-Qualcomm chipsets in mid-range and "near-flagship" smartphones over the coming months.

On a technical level, the Dimensity 9600 Pro is expected to replicate the 2+3+3 CPU architecture anticipated for the Snapdragon 8 Elite Gen 6, combining ARM C2-Ultra and C2-Pro cores with the ARM Magni GPU and LPDDR6 memory support. In contrast, the standard Dimensity 9600 is expected to retain LPDDR5X memory to keep costs down. Meanwhile, the Snapdragon 8 Elite Gen 6 Pro relies on fully Qualcomm-designed Oryon cores, with a stated focus on AI-driven upscaling and frame generation capabilities.

mundophone