Thu. May 19th, 2022


Cristiano Amon is terribly friendly to the head of a company known for its battles with Apple, Broadcom and antitrust enforcers from Beijing to Washington.

The Brazilian-born 51-year-old was described as “sociable”, “passionate” and “optimistic about everything.” In his San Diego office, there is a life-size cut of the engineer, his smiling face, and an outstretched hand that forms an inch upward.

Amon is CEO of Qualcomm, a $ 192 billion semiconductor designer whose Snapdragon chips power almost all premium Android devices. Its modems provide 5G connectivity to anything built by Apple, Samsung, Xiaomi and OPPO.

The primary task this decade for Amon – who first joined Qualcomm in 1995 and became CEO in June 2021 – is to expand beyond mobile phones to connected cars, the metaverse and the internet of things.

“5G is about really creating an opportunity to connect everyone and everything 100 percent of the time to the cloud,” says Amon about Zoom. “And we’re seeing an acceleration of digital transformation – it’s not a buzzword. Every single company is currently going through the process of accelerating digitally. That’s why we have the semiconductor supply chain crisis.”

Amon led the development of Qualcomm’s 5G strategy as president of its semiconductor device. While convincing managers of service providers, infrastructure providers and device manufacturers to accelerate the launch by a year, he quoted racer Mario Andretti as saying: “if everything seems out of control, you just are not going fast enough”.

During his first months as CEO, the pandemic largely robbed him of his personal touch. The last two years have seen far more demand for chips than suppliers can handle, and although Qualcomm is described as a “chip maker”, it can not increase production because it has none – it outsources manufacturing to like Samsung, TSMC and GlobalFoundries.

Yet, while Covid has risen, Amon has been navigating quarantines in Taiwan and South Korea to ensure a steady supply of chips from multiple sources, putting the company in a better position than competitors amid the chip shortage.

Working with suppliers to ensure production is the challenge Amon thrives on. Just as Apple’s Tim Cook oversaw direct investment in research and development and machinery to manufacture the iPhone, Amon works with vendors to design chips in every available capacity.

“We’re pushing the boundaries of what a ‘fabulous’ company is,” he says, using the industry term for a company that designs chips but outsources their manufacturing, or fab. “We are one of the few companies in the industry that actually, from a design perspective, drives the leading node – or advanced semiconductor manufacturing process – so we were a preferred partner of the foundries.”

Its predecessor, Steve Mollenkopf, oversaw years of conflict that gave Qualcomm an antagonistic image. It fought activist shareholders who wanted to break it up, avoiding a hostile takeover by Broadcom, and has won a significant battle against the U.S. Federal Trade Commission over allegations that it charged “unreasonably high royalties” for its intellectual property.

Qualcomm also filed an antitrust case in China, where it eventually paid a $ 975 million fine. And Beijing has forced Qualcomm to abandon a $ 44 billion acquisition of its Dutch counterpart NXP. Apple, meanwhile, has been battling Qualcomm for years, accusing it of laundering access to its patents. establish in 2019, which gives Qualcomm a $ 4.7 billion revenue boost.

Amon’s challenge is to move beyond conflicts and to reposition the company as a critical provider to industries moving in the digital age. Qualcomm needs more partners than ever, and Amon has been appointed as the smiling face to help make that happen.

Amon’s message to investors is that the company’s total available market of $ 100 billion will grow sevenfold this decade as Qualcomm diversifies.

In the metaverse, where Qualcomm is already working with Microsoft and Facebook parent Meta, Amon says the opportunity could be “as big as the smartphone itself.”

In the automotive industry, Amon wants to make sure Qualcomm not only makes chips, but designs platforms – a “digital chassis” – to power cars’ information entertainment systems and enable them to drive autonomously.

He says 23 of the big 26 global carmakers, including General Motors, BMW, Renault, Volvo and Honda, are partners. And in October, Qualcomm paid $ 4.5 billion to acquire the autonomous vehicle software company Veoneer, a Swedish auto parts manufacturer.

Investors were slow to understand Amon’s messages. From last January, when the company announced that Amon would take over the role, until mid-October, Qualcomm shares fell 17 percent. But by early this month, they had shot up 53 percent, to a record high, after Amon showed deft handling of the supply chain crisis.

Amon compares the market that Qualcomm tackles with the cloud groups Microsoft, Amazon and Alphabet. “You look at how valuable those companies are and you say, why is that? Because you assume exponential growth year-on-year from the cloud as more data moves to the cloud, ”he says.

“Well, where does the data come from? Who actually connects all those different devices to the cloud? This is us! So, if you believe in that opportunity, you must believe in a Qualcomm opportunity. This is the opportunity I have as CEO. ”

One of the biggest risks is that Qualcomm’s Chinese customers will develop their own integrated circuit products, as Beijing’s “Made in China 2025” campaign targets 70 percent semiconductor self-sufficiency by 2025. Few companies are as exposed to China as Qualcomm: last year, two-thirds of its $ 33.6 billion in revenue was earned in the region.

Apple demonstrates how a customer can wean himself from Qualcomm. In 2019, it acquired Intel’s modem business and launched a multi-year campaign to catch up with 5G modem technologies. It dropped Intel processors and made “Apple Silicon”.

Three questions for Cristiano Amon

Who is your leadership hero?

I have been fortunate to have many mentors. Many different people from all walks of life who have had an impact.

What was your first leadership lesson?

Surround yourself with people who are better than you.

If you were not a CEO / leader, what would you be?

If I had not chosen an engineering career – and I love technology, especially communication and wireless – I would have gone to law enforcement.

Amon says he understands the challenge. Even before becoming CEO, he orchestrated a $ 1.4 billion deal to acquire Nuvia, a new venture founded by former Apple chip architects. Nuvia’s mission focused on CPUs for data centers, but Amon is shifting its focus to consumer products.

The interests are existential. “You have to bet the company,” he says. Its good comparison to today’s technological rivalry is the ruthless world of Ancient Rome. “Especially at the moment, it’s like being in the gladiator venture: you go in, you prepare, you go to the Colosseum,” he says.

“The outcome can be one of three: You can win, you can lose and you can both lose. And if you win, all you have achieved is the right to go to the Colosseum one more time. ”

The metaphor is blunt, but even here Amon’s friendly side stopped him from pointing out that gladiators not only lose, they are killed. “I used ‘lost’,” he says with a smile, “because I did not want to say the word ‘die’.”

patrick.mcgee@ft.com



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