Businessmodel of Qorvo

Customer Segments

Qorvo has a niche market business model, with a specialized customer segment. The company targets its offerings at original design manufacturers (ODMs) and original equipment manufacturers (OEMs) seeking RF solutions for mobile, defense, and infrastructure applications.

Value Proposition

Qorvo offers four primary value propositions: accessibility, performance, innovation, and brand/status.

The company creates accessibility by offering what it touts as the broadest selection of RF technologies in its industry. It offers an end-to-end product line featuring all essential RF building blocks, including everything from premium filters to power amplifiers.

The company’s solutions demonstrate strong performance. Between its offerings from RFMD and TriQuint, it has achieved ISO 14001, ISO 9001, AS9100, and ISO/TS 16949 certifications.

The company emphasizes innovation. It is a pioneering player in the field of envelope tracking (ET) technology for wireless applications. It also continuously invests in and develops advanced GaN process technologies that will lead to groundbreaking GaN-based products.

The company has established a strong brand as a result of its performance. It maintains deep, longstanding relationships with many top tablet and smartphone manufacturers, consumer premises and network equipment manufacturers, and reference design partners. Its customer base also includes several Tier One defense subcontractors to the United States government. It has been accredited by the U.S. Department of Defense as a Microelectronics Trusted Source for foundry, packaging, post-processing, and assembly and test services. Further, in 2014 it was recognized by the Defense Department as the first GaN supplier to attain Manufacturing Readiness Level 9 based on readiness for full-scale GaN device production. Finally, it has won many honors. These include:

• The GTI Award for Outstanding Contribution on Innovative Technical Product
• The Electronic Engineering & Product World (EEPW) Editor’s Choice Award
• The ZTE Corporation Best Technical Support Award
• The NEOTech Star Supplier Award
• The Telephonics Innovation Award
• The Lenovo Mobile Business Group (MBG) Technology Innovation Award
• The Raytheon Gold Performance Award for Quality and Delivery ### Channels

Qorvo’s main channels are its direct sales force, its website, manufacturers’ representatives, and distributors (Mouser Electronics, RFMW, and Richardson RFPD). The company promotes its offering through its social media pages, e-mail newsletters, attendance at trade shows, and an annual product selection guide.

Customer Relationships

Qorvo’s customer relationship is primarily of a self-service nature. Customers utilize its products while having limited interaction with employees. The company’s website features a “Resources” section that includes articles, technical papers, videos, brochures, product catalogs, design tools (e.g., response calculators, cascade calculators, temperature calculators), and answers to frequently asked questions. That said, there is a personal assistance element in the form of phone and e-mail support.

Key Activities

Qorvo’s business model entails designing, developing, and manufacturing its products.

Key Partners

Qorvo maintains worldwide distribution agreements with RFMW, Mouser Electronics, and Richardson RFPD. The partners provide increased access to the company’s portfolio as well as broader design expertise. Qorvo also engages in collaboration with university researchers, professors, and students for the purpose of advancing radio frequency solutions. The arrangement offers internship opportunities to many students. Specific partners are as follows:

• Georgia Tech
• North Carolina State University
• Portland State University
• Texas A&M University
• UMass Amherst
• Universitat Politècnica de Catalunya
• University of California, Santa Barbara
• University of Central Florida
• University of Colorado Boulder
• University of Erlangen-Nuremberg
• University of Maine
• University of North Carolina at Charlotte
• University of Oregon
• University of South Florida
• University of Texas at Dallas
• Virginia Tech ### Key Resources

Qorvo’s main resource is its collection of manufacturing facilities, which are certified to ISO/TS 16949 standards, the highest quality standard for the automotive industry. Its primary buildings are located in Greensboro, North Carolina; Richardson, Texas; Hillsboro, Oregon; and Apopka, Florida. That said, it also maintains facilities in other North American cities, Europe, and Asia. The company relies on independent foundries to serve as suppliers for all of its silicon-based integrated circuits. Lastly, it places a high priority on its intellectual property, with over 1,100 patents.

Cost Structure

Qorvo has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions. Its biggest cost driver by far is cost of goods sold, a variable expense. Other major drivers are in the areas of research/development, sales/marketing, and administration, all fixed costs.

Revenue Streams

Qorvo has two revenue streams:

Product Revenues – The company generates revenues from the sale of its semiconductor products.

Other Revenues – Qorvo also obtains revenue from various miscellaneous sources such as contracts for R&D work, non-recurring engineering fees, royalty income, service revenue, and intellectual property (IP) revenue. These sources combined account for less than 1% of annual earnings.