Aristotle Value Equity Fund on Qualcomm
Thesis
Qualcomm is evolving from a handset-centric semiconductor company into a broader provider of connected-computing technologies. Aristotle views recent handset inventory and memory-cost pressures as cyclical rather than structural and points to record automotive revenue and growing exposure to IoT, AI-enabled PCs, industrial applications and data-center computing. The fund expects connectivity to expand across devices and AI workloads to move increasingly from the cloud to the edge, supporting strong long-run free cash flow.
“We believed these headwinds to be cyclical rather than structural and did not alter our long-term investment thesis.”
Key risks
- Handset inventory adjustments
- Higher memory costs and related production constraints
- Weakness in handset demand from Chinese customers