Smartphone RF front-end market revenue decreased 14% QoQ in Q2 2022

Smartphone RF front-end market revenue decreased 14% QoQ in Q2 2022
  • In the second quarter of 2022, the total smartphone RF front-end market revenue fell 14% quarter-on-quarter and 6% year-over-year.
  • Against the fall of the market, Qualcomm and Broadcom generated positive year-over-year revenue growth of around 7.6% and 12.2%, respectively.
  • We have revised the 2022 revenue growth projection for the smartphone RF front-end market to low single digits amid an unfavorable macro environment.

In Q2 2022, the overall market revenue for various smartphone-related RF interface components (RFFE), mainly including integrated RF PA (power amplifier) ​​modules, receiving modules, and discrete components such as filters, switches, LNA (low noise amplifiers). ) and energy trackers, down 14% quarter-on-quarter and 6% year-over-year, according to Counterpoint Smartphone RF Front Tracker.

Global smartphone shipments fell by 9% year-on-year in the second quarter of 2022, with the growth rate expected to slow further in the third quarter of 2022. Against the backdrop of these growing uncertainties, OEMs, particularly in the Android field, they became more conservative in managing Inventory and its liquidation efforts led to significant order reductions for general RF components, interrupting the secular growth trend of the smartphone RFFE sector. In this context, the main suppliers showed a mixed sales performance.

Smartphone RFFE market revenue decreased 6% year over year in Q2 2022

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Source: Counterpoint RF Front-end Tracker, Q2 2022

Qualcomm managed to generate a 7.6% year-over-year increase in revenue from RFFE components, building on its leadership in providing high-performance mobile platforms for premium smartphones. In the second quarter of 2022, shipments of flagship models powered by the Dragon mouth 8/8+ Gen 1 surpassed 10 million with a much stronger presence (share jumped to around 79%) at the samsung galaxy S22 family. This momentum will continue, resulting in strong demand for 4G/5G pairs embedded in PA and millimeter wave modules. Additionally, we saw the widespread adoption of Qualcomm’s diversity reception modules across all platforms at the expense of muRata.

SkyworksRFFE revenues were nearly flat year-on-year, with a higher contribution from Apple and Samsung (the top two customers were estimated to account for approximately 90% of Skyworks’ mobile revenue of $764 million in Q2 2022), but less exposure to China-based OEMs (<10% of revenue Skyworks phones), as its product portfolio is positioned towards the mid to high end where there is a high level of customization requirements.

QorveQorvo’s smartphone RFFE revenue decreased 11.3% year-over-year in Q2 2022 due to reduced smartphone production across its Android customers (collectively contributing to around 60% of Qorvo’s MP revenue). Qorvo of $733 million in the second quarter of 2022), although the company achieved new design achievements, such as the first shipments of low-band PAMiD (LB PAD) modules to Samsung, and increased production of PAMiD (MHB PAD) modules from mid/high band for the next Google 7 Serie.

broadcomwhich has been providing MHB PAD modules for Apple iPhones and Samsung premium models, saw its RFFE revenue increase by 12.2% year-on-year in the second quarter of 2022, mainly driven by increased production of the iPhone SE 2022.

MurataRFFE’s revenue from smartphone applications experienced a sharp decline of 25.5% YoY in dollar terms. The drop was largely due to the significant depreciation of the yen, as well as falling shipments to its Android customers in China.

China’s RFFE providers face greater challenges as the low-end smartphone segment is more vulnerable to the impact of the global economic downturn and rising inflation. For example, Maxscend, the leading provider of RF solutions in mainland China, reported a revenue decline of more than 25% year over year for the second quarter of 2022 in dollar terms.

2022 Smartphone RFFE Revenue Growth Forecast Revised Down

Globally, high inflation and economic slowdown are prompting consumers to cut back on unnecessary spending, leading to a prolonged smartphone replacement cycle. Major Android OEMs have lowered their production targets for the second half of 2022, and the resulting inventory fix is ​​expected to persist through early 2023.

On the other hand, the annual 5G smartphone Shipment volume is expected to increase by 20%, while the high-end segment indicates a higher level of resilience in the face of the current market contraction. For example, Apple is estimated to ship 25 million more 5G iPhones than in 2021, with an equivalent production volume for the iPhone 14 series in the second half of 2022 compared to its predecessor.

Therefore, Counterpoint revised down its 2022 growth forecast for the RFFE smartphone market to the low single-digit range (1% ~ 3%) to reflect the larger-than-expected impact on demand for RFFE components. But in the longer term, the RFFE market is built on the global expansion of 5G and mmWave and has great potential for secular growth.

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