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Qualcomm Inc. recorded a loss during its last quarter as sales of the company's mobile modem development unit remained unchanged and its licensing business continued to be affected by a continuing struggle with Apple Inc.
Qualcomm, based in San Diego, announced Wednesday a loss of $ 493 million, or 35 cents per share, against a profit of $ 168 million, or 11 cents a share, a year earlier. Qualcomm also had spending problems in the last quarter, with total costs increasing 16% to $ 6.46 billion.
On an adjusted basis, Qualcomm posted a profit of 90 cents per share, exceeding the 83 cents per share expected by analysts surveyed by FactSet.
Qualcomm achieved a turnover of $ 5.8 billion for the quarter, down 2% from the previous year. Analysts were expecting $ 5.53 billion.
The company had $ 4.65 billion in revenue in its segment that creates chipsets for mobile devices, which is about the same as last year. The company's pre-tax earnings dropped 18 percent to $ 796 million, according to the company. Qualcomm, however, indicated that mobile modem shipments had increased by 5%.
In its licensing business, sales decreased 6% to $ 1.14 billion and pre-tax earnings decreased 11% to $ 739 million. Qualcomm did not record any license revenue during the quarter at Apple, which withholds Qualcomm's royalty payments in connection with a dispute over the company's licensing practices.
Qualcomm has accused Apple of transferring its intellectual property to Intel Corp., which provides chips for new model iPhones.
At the same time, a federal judge said earlier this week that Qualcomm had to license some of its patents in order to compete with chip suppliers in an antitrust proceeding initiated by the Federal Trade Commission.
Qualcomm's shares fell 3.5% after trading hours. Shares of the company closed down 0.7% earlier Wednesday.
For the current quarter – the first of the company's first fiscal year – Qualcomm expects a business turnover of between $ 4.5 and $ 5.3 billion and earnings per share of between 78 and 88 cents. Adjusted earnings are expected to be between $ 1.05 per share and $ 1.15 per share, ahead of consensus consensus forecasts of 94 cents per share.
Write to Micah Maidenberg at [email protected]
Qualcomm Inc. recorded a loss during its last quarter as sales of the company's mobile modem development unit remained unchanged and its licensing business continued to be affected by a continuing struggle with Apple Inc.
Qualcomm, based in San Diego, announced Wednesday a loss of $ 493 million, or 35 cents per share, against a profit of $ 168 million, or 11 cents a share, a year earlier. Qualcomm also had spending problems in the last quarter, with total costs increasing 16% to $ 6.46 billion.
On an adjusted basis, Qualcomm posted a profit of 90 cents per share, exceeding the 83 cents per share expected by analysts surveyed by FactSet.
Qualcomm achieved a turnover of $ 5.8 billion for the quarter, down 2% from the previous year. Analysts were expecting $ 5.53 billion.
The company had $ 4.65 billion in revenue in its segment that creates chipsets for mobile devices, which is about the same as last year. The company's pre-tax earnings dropped 18 percent to $ 796 million, according to the company. Qualcomm, however, indicated that mobile modem shipments had increased by 5%.
In its licensing business, sales decreased 6% to $ 1.14 billion and pre-tax earnings decreased 11% to $ 739 million. Qualcomm did not record any license revenue during the quarter at Apple, which withholds Qualcomm's royalty payments in connection with a dispute over the company's licensing practices.
Qualcomm has accused Apple of transferring its intellectual property to Intel Corp., which provides chips for new model iPhones.
At the same time, a federal judge said earlier this week that Qualcomm had to license some of its patents in order to compete with chip suppliers in an antitrust proceeding initiated by the Federal Trade Commission. According to some analysts, this decision could have the effect of disrupting Qualcomm's practice of licensing manufacturers of devices rather than chip suppliers.
During a phone conversation with analysts Wednesday, chief executive Steve Mollenkopf said the "FTC's decision is incorrect". He said the company was focusing on settling the case, which will go to trial in January.
"Nothing in the order complicates that and, in the meantime, we are not obliged to do the same with the company," said Mollenkopf.
A slowdown in global smartphone sales is compounding Qualcomm's licensing issues. The company expects a 22% drop in modem chip shipments, about 185 million units, over the three months ending in December. The company said the decline partly reflects Apple's release of new iPhones without Qualcomm modem chips.
Qualcomm's shares fell 4.3% after trading hours. Shares of the company closed down 0.7% earlier Wednesday.
For the current quarter – the first of the company's first fiscal year – Qualcomm expects a business turnover of between $ 4.5 and $ 5.3 billion and earnings per share of between 78 and 88 cents. Adjusted earnings are expected to be between $ 1.05 per share and $ 1.15 per share, ahead of consensus consensus forecasts of 94 cents per share.
Qualcomm faced a series of challenges during its last fiscal year. Earlier this year, the company rebuffed a public offer to buy Broadcom Inc., an operation ultimately canceled by President Trump.
In June, Qualcomm canceled its project to acquire Dutch chip maker NXP Semiconductors NV, worth $ 44 billion, after failing to obtain approval from Chinese regulators.
Qualcomm also remains in a separate dispute with Chinese smartphone maker Huawei Technologies Co., which also withholds royalty payments.
Qualcomm said it had repurchased 254.6 million shares worth $ 21.14 billion during the September period, thereby meeting the commitment it had taken after to have abandoned its offer on NXP.
– Tripp Mickle contributed to this article.
Write to Micah Maidenberg at [email protected]
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