Qualcomm warns of smartphone Snapdragon chip shortage

HTC and Qualcomm bosses pose for a photo The shortage may force HTC and others to redesign some of their smartphones

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The world's best-selling mobile phone chipmaker has warned that it cannot meet demand for some of its processors.

Qualcomm said that the third-party factories to which it subcontracts the manufacture of the "28 nanometre" chips would not be able to create enough supply until the end of the year.

The news will impact Android and Windows-based phone makers who had planned to use the products.

The firm admits they may turn to rivals to power their mid-range handsets.

Details of the setback emerged during a conference call to investors after the US firm's latest results.

The company's chief operating officer, Steve Mollenkopf, confirmed that the problem was that Qualcomm had underestimated demand for it S4 Snapdragon chips, adding that the firm was trying to push some of its alternative products.

Alternative chipset

"In any constrained environment, people look for any alternative they can in order to solve the problem," he is quoted as saying in a transcript of the call by financial news site Seeking Alpha.

"We've been helping customers to see how they can swap in our Fusion 2 chipset... [but] we do expect to see some alternative non-Qualcomm chipsets used to solve that issue as well."

He added that the firm was acting to outsource production to other fabricators in addition to its key supplier, Taiwan Semiconductor Manufacturing Company.

One analyst told the BBC that the news could have a limited effect on mobile phone supplies.

"Looking forward, this will impact shipments of mass-market smartphones as firms re-engineer their devices, but having said that, I think the industry should not take too long to catch up," said Malik Saadi, principal analyst at Informa Telecoms.

"This isn't the first time we've seen this kind of problem when a chip designer upgrades to a new semiconductor design."

Qualcomm's shares fell over 7% in after-hours trading following the announcement before making a partial recovery.

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