Marketers are mislead to think that they promotionally come out ahead with incremental sales and profits in spite of lower margins because mix models do not measure the longer-term negative consequences of cannibalized, future full-margin sales.
However, the company maintained its full year operating margin guidance for the chipset and licensing divisions, implying that the later half of the year should pick up the slack as handset makers launch high-end smartphones in preparation for the holiday season.