Alger Spectra Fund on QUALCOMM Incorporated
Thesis
Alger's short thesis on Qualcomm focused on slowing growth in the mature smartphone market and intensifying competition in the company's core chips and licensing businesses. The position moved against the fund as investors began to re-rate Qualcomm as an AI-infrastructure participant following better-than-expected earnings and news that data-center chips were on track to ship to a major cloud customer. Record automotive growth, easing trade tensions and analyst upgrades added further upside pressure and illustrate the main risks to the short thesis.
“our position reflected concerns around that slowing core business and intensifying competition within it.”
Key risks
- Successful data-center chip shipments to a major cloud customer
- Record automotive growth
- Further analyst upgrades as investors re-rate the company as an AI participant