Key points
- Why Alphabet's Qualcomm stake traces to a startup sale
- How Alphabet's GV ended up holding Qualcomm stock
- How much of Alphabet's 13F is SpaceX
Alphabet (GOOGL) disclosed a new $548 million stake in Qualcomm (QCOM) in a 13F filing on November 6. The shares don't look like a fresh purchase. Filings show that GV, Alphabet's venture arm, received Qualcomm stock when Qualcomm bought AI software startup Modular this summer.
Reuters reported that Alphabet "built a stake" in Qualcomm, and Qualcomm rose 3% before the market opened. The route to that stake matters, because a payout from a startup sale says something different from a decision to buy a chipmaker's stock.
The clue sits in a column most people skip. A 13F lists which manager oversees each holding, and Alphabet's filing gives Qualcomm the number 1. The cover page says number 1 is GV Management Company. That sent us to Qualcomm's own filings.
How did GV end up with Qualcomm shares?
Qualcomm agreed on June 21 to buy Modular, a deal valued at about $3.9 billion. Qualcomm paid in stock, saying it expected to issue up to 19.2 million shares to Modular's owners.
After the deal closed, Qualcomm filed a prospectus on July 31 so those owners could resell. It lists two GV funds, and it names Alphabet at the top of the chain of control for both.
| Filing | Holder | Qualcomm shares |
|---|---|---|
| Alphabet 13F, June 30 | All Alphabet managers | 0 |
| Qualcomm prospectus, July 31 | GV 2021, L.P. | 2,206,989 |
| Qualcomm prospectus, July 31 | GV 2023, L.P. | 989,272 |
| Qualcomm prospectus, July 31 | Both GV funds | 3,196,261 |
| Alphabet 13F, September 30 | GV Management Company | 2,976,982 |
The two counts don't match exactly. The September figure is 219,279 shares lower, and the filings don't say why. Neither filing says outright that these are the Modular shares, either. But the manager is the same, the timing fits, and Alphabet's June 13F shows no Qualcomm at all.
The payoff for GV was a good one. Dave Munichiello, the GV partner who led the investment, told Crunchbase News in June that it was "a 27x return on our initial investment and roughly 10x on our total dollars invested." GV's first check was $23 million.
Does this change what the stake means?
A little. Google and Qualcomm are real partners, and Reuters pointed to their work on Android phones, cars, and Google's Googlebook laptops. None of that goes away. But a venture fund taking stock in a sale is a different signal from Google choosing to back Qualcomm's data center plans with cash.
The prospectus also registered those shares for resale. That doesn't mean GV has sold or will sell.
The stake is small, too. It's less than 0.3% of Qualcomm, by our calculations. Amazon (AMZN), by comparison, received a warrant in September to buy up to 25 million Qualcomm shares at $161.26 each, tied to a server chip agreement.
Qualcomm closed at $156.75 on November 5, down from $184.04 on September 30. At that price, the 2,976,982 shares were worth $466.6 million, or $81.2 million less than the 13F value. That assumes the share count hasn't changed since September. Qualcomm closed at $165.41 on November 6, and SpaceX closed at $134.27.
How much of Alphabet's 13F is SpaceX?
Nearly all of it. The filing reports $88.3 billion of holdings, and SpaceX (SPCX) is $83.7 billion, or about 95%. Those shares sit under a different Alphabet unit, XXVI Holdings.
A 13F only covers certain US-listed securities, so private holdings aren't in that total. It also shows one date. SpaceX closed at $150.86 on September 30 and $123.62 on November 5, which would take the 555 million shares from $83.7 billion to $68.6 billion, by our calculations.
Moves in SpaceX's stock reach Alphabet's earnings. Alphabet's quarterly report said other income fell $21.0 billion from a year earlier and gave two main causes: net unrealized losses on marketable equity securities "largely from SpaceX," and smaller unrealized gains on private holdings "largely from a private company." The same report said $75.2 billion of the SpaceX shares had short-term limits on selling at September 30.
What else changed in the filing?
Share counts tell you what happened better than dollar values, since dollar values move with the stock. Here are the biggest changes from June 30 to September 30.
| Company | June 30 shares | September 30 shares |
|---|---|---|
| SpaceX (SPCX) | 551,189,500 | 555,043,560 |
| Qualcomm (QCOM) | 0 | 2,976,982 |
| Freenome | 0 | 2,022,131 |
| Neutron Holdings (Lime) | 0 | 1,898,948 |
| Obsidian Therapeutics | 0 | 1,224,869 |
| Ethos Technologies | 3,622,604 | 571,907 |
| GitLab | 2,724,712 | 0 |
| Freshworks | 16,206,643 | 14,336,643 |
Qualcomm isn't the only new line that looks like this. Freenome, Lime, and Obsidian all recently became public companies, and GV is listed as a manager on each. So a new row on this filing doesn't always mean Alphabet went shopping.
The filing doesn't explain the 3.9 million extra SpaceX shares. Alphabet's stakes in Arm, AST SpaceMobile (ASTS), and CME Group didn't change.
What don't we know yet?
We don't know why the GV count fell by 219,279 shares, or whether GV has sold any since September 30. A 13F is a snapshot of one date. The next regularly scheduled 13F would show the December 31 holdings and is due in February.
There's also a coincidence worth keeping in its place. SpaceX, Alphabet's largest holding, picked Qualcomm for its 5G network on November 4, after the date this filing covers. Nothing in these filings connects the two.
We'll watch whether that Qualcomm row grows, stays flat, or shrinks in the next 13F. The filing may not explain why.
