Qualcomm Incorporated

QUALCOMM Announces Third Quarter Fiscal 2006 Results

    San Diego (ots/PRNewswire) -

                            Revenues US$1.95 Billion, Diluted EPS US$0.37
                    Pro Forma Revenues US$1.95 Billion, Diluted EPS US$0.42
                  Fourth Consecutive Quarter of Record Revenues and Chip
                 Shipments; Financial Guidance Increased for Fiscal 2006

    QUALCOMM Incorporated (Nasdaq: QCOM) today announced results for the  third fiscal quarter ended June 25, 2006.

    Total QUALCOMM (GAAP) Third Quarter Results:

    Total QUALCOMM results are reported in accordance with Generally Accepted Accounting Principles (GAAP).

@@start.t1@@      - Revenues: US$1.95 billion, up 44 percent year-over-year and 6 percent
         sequentially.
      - Net income: US$643 million, up 15 percent year-over-year and 8 percent
         sequentially.
      - Diluted earnings per share: US$0.37, up 12 percent year-over-year and
         9 percent sequentially.
      - Effective tax rate: 22 percent for the quarter and estimated for
         fiscal 2006.
      - Estimated share-based compensation: US$83 million, net of tax.
      - Operating cash flow: US$816 million, up 56 percent year-over-year;
         42 percent of revenue.
      - Return of capital to stockholders: US$1.37 billion in the third
         quarter, including US$202 million of cash dividends, or US$0.12 per
         share, and US$1.17 billion to repurchase 26.4 million shares of our
         common stock. After the end of the third fiscal quarter, we repurchased
         an additional 5.6 million shares for US$238 million, with fiscal 2006
         repurchases to date totaling 32.0 million shares for US$1.40 billion.@@end@@

    QUALCOMM Pro Forma Third Quarter Results:

    Pro forma results exclude the QUALCOMM Strategic Initiatives (QSI) segment, estimated share-based compensation, tax benefits related to prior years and acquired in-process research and development (R&D) expense.

@@start.t2@@      - Revenues: US$1.95 billion, up 44 percent year-over-year and 6 percent
         sequentially.
      - Net income: US$726 million, up 56 percent year-over-year and 3 percent
         sequentially.
      - Diluted earnings per share: US$0.42, up 50 percent year-over-year and
         2 percent sequentially; excludes US$0.05 loss per share attributable to
         estimated share-based compensation.
      - Effective tax rate: 26 percent for the quarter and estimated for
         fiscal 2006.
      - Free cash flow: US$795 million, up 116 percent year-over-year;
         41 percent of revenue. (Defined as net cash from operating activities
         less capital expenditures)@@end@@

    Detailed reconciliations between total QUALCOMM (GAAP) results and QUALCOMM pro forma results and cash flows are included at the end of this news release. Prior period reconciliations are presented on our Investor Relations web page at www.qualcomm.com.

    "Our results this quarter were driven by continued customer demand for our broadly segmented chipsets with particular strength in 1xEV-DO and WCDMA," said Dr. Paul E. Jacobs, chief executive officer of QUALCOMM. "WCDMA handset shipments continue to increase and WCDMA Mobile Station Modem(TM) (MSM(TM)) unit shipments increased 24 percent from the March quarter."

    "We shipped a record number of cell site modem voice-equivalent channel elements in the quarter, which was primarily driven by demand for our EV-DO Rev A CSM6800(TM) solution. Several operators, including KDDI, Sprint Nextel, Telecom New Zealand and Verizon have announced plans to upgrade their CDMA networks to EV-DO Rev A technology as early as this calendar year. CDMA subscribers and enterprise customers worldwide will soon benefit from the unmatched broadband performance of EV-DO Rev A. In addition, voice over internet protocol (VoIP) on EV-DO Rev A will enable in-band migration to fully packet-based networks and ultimately to much higher data rates via EV-DO Rev B multi-carrier operation. We are currently developing VoIP capabilities and data rate enhancement techniques for WCDMA/HSPA networks as well."

    "This quarter also demonstrated QUALCOMM's continued focus on enhancing stockholder value. Our balance sheet strength and unique business model provide significant financial flexibility to increase cash dividends and repurchase shares while we continue to grow our R&D investments for the many business opportunities we see ahead."

    Cash and Marketable Securities

    QUALCOMM's cash, cash equivalents and marketable securities totaled approximately US$9.5 billion at the end of the third quarter of fiscal 2006, compared to US$10.2 billion at the end of the prior quarter and US$7.9 billion a year ago. The decrease from the prior quarter was primarily attributable to stock repurchases in the third quarter. We also sold four put options in connection with our stock repurchase program which, if exercised, will require us to repurchase an additional 4 million shares of our common stock for US$182 million, net of premiums received. On July 7, 2006, we  announced a cash dividend of US$0.12 per common share payable on  September 22, 2006 to stockholders of record at the close of business on  August 25, 2006.

    Estimated Share-Based Compensation

    In the first quarter of fiscal 2006, we adopted the revised Statement of Financial Accounting Standards No. 123, Share-Based Payment (FAS 123R), which requires that share-based compensation be recorded in our financial statements. We implemented FAS 123R using the modified prospective method. Under this method, prior periods are not revised for comparative purposes. Estimated share-based compensation is included in operating expenses, however, it is not allocated to business segments or included in pro forma results because we do not consider it relevant when evaluating the operating performance of our business. Total QUALCOMM (GAAP) net income for the third quarter of fiscal 2006 included estimated share-based compensation of  US$83 million, net of tax, or US$0.05 per share.

@@start.t3@@      Research and Development
                                                                        Estimated                  Total
                                                  QUALCOMM      Share-Based                QUALCOMM
      (US$ in millions)                    Pro Forma  Compensation    QSI        (GAAP)
      Third quarter fiscal 2006        $322                $56          $17         $395
      Third quarter fiscal 2005        $246                $--          $13         $259
      Year-over-year change                 31%                                31%          53%@@end@@

    Pro forma R&D expenses increased 31 percent year-over-year, primarily due to additional engineering resources for the development of integrated circuit products and other initiatives to support low-cost phones, multimedia applications, high-speed wireless Internet access and multimode, multiband, multinetwork products and technologies, including CDMA2000, 1xEV-DO, EV-DO Rev. A, WCDMA (including GSM/GPRS/EDGE), HSDPA, HSUPA and OFDMA, and the development of our iMoD(TM) display products using MEMS technology. QSI R&D expenses increased year-over-year primarily due to increased R&D activities related to MediaFLO(TM) USA.

@@start.t4@@      Selling, General and Administrative
                                                                         Estimated                    Total
                                                    QUALCOMM      Share-Based                 QUALCOMM
      (US$ in millions)                      Pro Forma  Compensation    QSI         (GAAP)
      Third quarter fiscal 2006        $214                 $60          $19          $293
      Third quarter fiscal 2005        $151                 $--          $(1)         $150
      Year-over-year change                 42%                                 N/M            95%@@end@@

    Pro forma selling, general and administrative (SG&A) expenses increased 42 percent year-over-year, largely attributable to increases in employee related expenses to support our growing worldwide customer base and professional fees related to legal activities. The year-over-year increase in QSI SG&A expenses is primarily related to MediaFLO USA and the effect of other income in the prior year's quarter.

    Effective Income Tax Rate

    Our fiscal 2006 estimated annual effective income tax rates and our third quarter effective income tax rates are approximately 22 percent for total QUALCOMM (GAAP) and 26 percent for QUALCOMM pro forma.

    QUALCOMM Strategic Initiatives

    The QSI segment includes our strategic investments, including our MediaFLO USA subsidiary, and related income and expenses. Total QUALCOMM (GAAP) results for the third quarter of fiscal 2006 included break-even results for the QSI segment compared to US$0.05 diluted earnings per share in the third quarter of fiscal 2005. The third quarter of fiscal 2006 QSI results included US$36 million in operating expenses, primarily related to MediaFLO USA, and US$4 million in other-than-temporary losses on other  investments, partially offset by US$12 million in realized gains on  investments. In addition to the tax benefit applicable to its loss before  tax, the QSI segment includes the tax benefit resulting from an increase in  the forecast of our ability to use capital loss carryforwards.

    Business Outlook

    The following statements are forward-looking and actual results may differ materially. Please see "Note Regarding Forward-Looking Statements" at the end of this news release for a description of certain risk factors and QUALCOMM's annual and quarterly reports on file with the Securities and Exchange Commission (SEC) for a more complete description of risks. Due to their nature, certain income and expense items, such as realized investment gains or losses in QSI, gains and losses on certain derivative instruments or asset impairments, cannot be accurately forecast. Accordingly, the Company excludes forecasts of such items from its business outlook, and actual results may vary materially from the business outlook if the Company incurs any such income or expense items.

    The following table summarizes total QUALCOMM (GAAP) and QUALCOMM pro forma guidance for the fourth quarter of fiscal 2006 based on the current business outlook. Total QUALCOMM (GAAP) guidance for the fourth fiscal quarter of 2006 includes approximately US$0.05 diluted loss per share related to estimated share-based compensation. Estimated share-based compensation in future periods may vary materially from the business outlook as the methodology used to calculate this estimate is dependent on a variety of assumptions which are subject to market fluctuations and other factors. A pro forma business outlook is provided below consistent with the presentation of pro forma results provided elsewhere herein.

    The following estimates are approximations and are based on the current business outlook:

@@start.t5@@      (All figures are in US$)
                                            Business Outlook Summary
      FOURTH QUARTER
                                                                                              Current Guidance
                                                                          Q4'05                    Q4'06
                                                                         Results                Estimates
      QUALCOMM Pro Forma
      Revenues                                                      $1.56B          $1.88B - $1.98B
      Year-over-year change                                                 increase 21% - 27%
      Diluted earnings per share (EPS)                 $0.32              $0.39 - $0.41
      Year-over-year change                                                 increase 22% - 28%
      Total QUALCOMM (GAAP)
      Revenues                                                      $1.56B          $1.88B - $1.98B
      Year-over-year change                                                 increase 21% - 27%
      Diluted earnings per share (EPS)                 $0.32              $0.33 - $0.35
      Year-over-year change                                                    increase 3% - 9%
      Diluted EPS attributable to QSI                  $0.00                        ($0.01)
      Diluted EPS attributable to estimated
        share-based compensation                                n/a                        ($0.05)
      Metrics
      MSM Shipments                                      approx. 40M        approx. 53M - 56M
      CDMA/WCDMA handset units shipped      approx. 48M(A)    approx. 67M - 70M(A)
      CDMA/WCDMA handset unit wholesale
        average selling price                    approx. $213(A)      approx. $215(A)
      (A)Shipments in June quarter, reported in Sept. quarter
      FISCAL YEAR
                                                                      Prior                          Current
                                                                  Guidance                         Guidance
                                         FY 2005                FY 2006                         FY 2006
                                         Results              Estimates                      Estimates
      QUALCOMM Pro Forma
      Revenues                      $5.67B            $7.1B - $7.4B                $7.4B - $7.5B
      Year-over-year
        change                                      increase 25% - 30%        increase 30% - 32%
      Diluted earnings
        per share (EPS)          $1.16            $1.53 - $1.57                $1.61 - $1.63
      Year-over-year
        change                                      increase 32% - 35%        increase 39% - 41%
      Total QUALCOMM (GAAP)
      Revenues                        $5.67B          $7.1B - $7.4B                $7.4B - $7.5B
      Year-over-year
        change                                      increase 25% - 30%        increase 30% - 32%
      Diluted earnings
        per share (EPS)            $1.26          $1.31 - $1.35                $1.40 - $1.42
      Year-over-year
        change                                         increase 4% - 7%        increase 11% - 13%
      Diluted EPS
        attributable to
        in-process R&D                 n/a                    ($0.01)                         ($0.01)
      Diluted EPS
        attributable to
        QSI                                $0.06                    ($0.04)                         ($0.03)
      Diluted EPS
        attributable to
        estimated
        share-based
        compensation                    n/a                    ($0.20)                         ($0.20)
      Diluted EPS
        attributable to
        tax benefit
        related to
        prior years                  $0.04                        $0.03                            $0.03
      Metrics
      Fiscal year(B)
        CDMA/WCDMA
        handset unit
        wholesale
        average
        selling price    approx. $215            approx. $207                 approx. $213
      (B)Shipments in Sept. to June quarters, reported in Dec. to Sept.
          quarters@@end@@

@@start.t6@@      CALENDAR YEAR Handset Estimates
                                                                          Prior                    Current
      CDMA/WCDMA                                                 Guidance                  Guidance
        handset unit                                        Calendar 2006          Calendar 2006
        shipments          Calendar 2005                Estimates                 Estimates
      March quarter
        actuals                approx. 43M      approx. 65M - 66M                 approx. 66M
      June quarter         approx. 48M              not provided        approx. 67M - 70M
      September
        quarter                approx. 52M              not provided                not provided
      December
        quarter                approx. 67M              not provided                not provided
      Calendar year
        range                 approx. 210M  approx. 275M - 290M    approx. 285M - 295M
                                      Midpoint                    Midpoint                    Midpoint
      CDMA/WCDMA
        units                 approx. 210M              approx. 283M                approx. 290M
      CDMA units          approx. 160M              approx. 187M                approx. 190M
      WCDMA units          approx. 50M                approx. 96M                approx. 100M
      Sums may not equal totals due to rounding
      Results of Business Segments (in millions, except per share data):
      Third Quarter - Fiscal Year 2006
                                                                                      Reconciling    QUALCOMM
      Segments                              QCT         QTL        QWI      Items(1)        Pro Forma
      Revenues                          $1,133      $683      $162         $(27)            $1,951
      Change from prior year          48%        52%        (1%)        N/M                    44%
      Change from prior quarter      11%         1%         0%         N/M                      6%
      EBT                                      $303      $619        $19          $35                 $976
      Change from prior year          63%        52%        58%         N/M                    49%
      Change from prior quarter      20%        (1%)      19%         N/M                      1%
      Net income (loss)                                                                                 $726
      Change from prior year                                                                            56%
      Change from prior quarter                                                                         3%
      Diluted EPS                                                                                         $0.42
      Change from prior year                                                                            50%
      Change from prior quarter                                                                         2%
      Diluted shares used                                                                            1,728
      Third Quarter - Fiscal Year 2006
                                                                  Estimated                              Total
                                                                 Share-Based                          QUALCOMM
      Segments                                          Compensation(2)        QSI(4)        (GAAP)
      Revenues                                                    $--                  $--          $1,951
      Change from prior year                                --                    --                 44%
      Change from prior quarter                          --                    --                  6%
      EBT                                                         $(126)                $(26)            $824
      Change from prior year                              N/M                  N/M                 20%
      Change from prior quarter                         N/M                  N/M                  5%
      Net income (loss)                                    $(83)                 $--              $643
      Change from prior year                              N/M                  N/M                 15%
      Change from prior quarter                         N/M                  N/M                  8%
      Diluted EPS                                          $(0.05)                 $--            $0.37
      Change from prior year                              N/M                  N/M                 12%
      Change from prior quarter                         N/M                  N/M                  9%
      Diluted shares used                                1,728                1,728            1,728@@end@@

@@start.t7@@      Second Quarter - Fiscal Year 2006
                                                                                    Reconciling      QUALCOMM
      Segments                              QCT        QTL        QWI      Items(1)         Pro Forma
      Revenues                          $1,018    $679      $162         $(25)              $1,834
      EBT                                        252      626         16            68                    962
      Net income (loss)                                                                                  706
      Diluted EPS                                                                                         $0.41
      Diluted shares used                                                                            1,721
      Second Quarter - Fiscal Year 2006
      Segments                          Estimated                                                  Total
                                            Share-Based          In-Process                    QUALCOMM
                                            Compensation(2)        R&D(3)        QSI(4)        (GAAP)
      Revenues                                $--                      $--              $--         $1,834
      EBT                                      (120)                    (21)            (36)            785
      Net income (loss)                 (78)                    (21)            (14)            593
      Diluted EPS                      $(0.05)                $(0.01)        $(0.01)         $0.34
      Diluted shares used          1,721                  1,721          1,721          1,721
      Third Quarter - Fiscal Year 2005
                                                                                    Reconciling      QUALCOMM
      Segments                              QCT        QTL        QWI      Items(1)         Pro Forma
      Revenues                            $766      $448      $164          $(20)          $1,358
      EBT                                      186        407         12              51                 656
      Net income                                                                                            465
      Diluted EPS                                                                                        $0.28
      Diluted shares used                                                                          1,683
      Third Quarter - Fiscal Year 2005
                                                                                                              Total
                                                                    Tax                                  QUALCOMM
      Segments                                         Adjustments(5)        QSI(4)         (GAAP)
      Revenues                                                  $--                  $--          $1,358
      EBT                                                            --                    30                686
      Net income                                                 16                    79                560
      Diluted EPS                                          $0.01                $0.05            $0.33
      Diluted shares used                              1,683                1,683            1,683
      Fourth Quarter - Fiscal Year 2005
                                                                                      Reconciling    QUALCOMM
      Segments                                QCT        QTL        QWI      Items(1)        Pro Forma
      Revenues                              $912      $497      $170          $(19)         $1,560
      EBT                                        266        451         21              75                813
      Net income (loss)                                                                                 543
      Diluted EPS                                                                                        $0.32
      Diluted shares used                                                                          1,686
      Fourth Quarter - Fiscal Year 2005
                                                                                                              Total
                                                                                                            QUALCOMM
      Segments                                                                  QSI(4)              (GAAP)
      Revenues                                                                      $--                $1,560
      EBT                                                                              (27)                  786
      Net income (loss)                                                         (5)                  538
      Diluted EPS                                                                 $--                 $0.32
      Diluted shares used                                                 1,686                 1,686
      Twelve Months - Fiscal Year 2005
                                                                                    Reconciling      QUALCOMM
      Segments                         QCT          QTL         QWI        Items(1)        Pro Forma
      Revenues                      $3,290      $1,839      $644         $(100)         $5,673
      EBT                                  852        1,663         57            227            2,799
      Net income                                                                                        1,970
      Diluted EPS                                                                                      $1.16
      Diluted shares used                                                                         1,694
      Twelve Months - Fiscal Year 2005
                                                                                                              Total
                                                                  Tax                                    QUALCOMM
      Segments                                    Adjustments(5)(6)        QSI(4)         (GAAP)
      Revenues                                                $--                      $--          $5,673
      EBT                                                         --                        10            2,809
      Net income                                              71                      102            2,143
      Diluted EPS                                        $0.04                  $0.06            $1.26
      Diluted shares used                          1,694                  1,694            1,694@@end@@

@@start.t8@@      Nine Months - Fiscal Year 2006
                                                                                      Reconciling    QUALCOMM
      Segments                         QCT          QTL         QWI        Items(1)        Pro Forma
      Revenues                      $3,184      $1,926      $491          $(74)          $5,527
      Change from prior
        year                                 34%          44%         4%          N/M                  34%
      EBT                                 $855      $1,762        $52          $176            $2,845
      Change from prior
        year                                 46%          45%        41%          N/M                  43%
      Net income (loss)                                                                            $2,098
      Change from prior year                                                                          47%
      Diluted EPS                                                                                        $1.22
      Change from prior year                                                                          45%
      Diluted shares used                                                                          1,717
      Nine Months - Fiscal Year 2006
                            Estimated                                                                    Total
                          Share-Based                Tax            In-Process                QUALCOMM
      Segments  Compensation(2)    Adjustments(7)      R&D(3)      QSI(4)      (GAAP)
      Revenues              $--                      $--                $--            $--        $5,527
      Change
        from
        prior
        year                    --                        --                 --              --              34%
      EBT                  $(368)                    $--              $(21)        $(110)      $2,346
      Change
        from
        prior
        year                  N/M                        --                 --            N/M              16%
      Net income
        (loss)            $(243)                    $56              $(21)         $(34)      $1,856
      Change
        from
        prior
        year                  N/M                      N/M                N/M            N/M              16%
      Diluted
        EPS                $(0.14)                 $0.03          $(0.01)      $(0.02)        $1.08
      Change
        from
        prior
        year                  N/M                      N/M                N/M            N/M              14%
      Diluted
        shares
        used                1,717                  1,717            1,717         1,717         1,717
      Nine Months - Fiscal Year 2005
                                                                                      Reconciling    QUALCOMM
      Segments                         QCT          QTL         QWI        Items(1)        Pro Forma
      Revenues                      $2,378      $1,342      $473            $(81)         $4,112
      EBT                                  586        1,212         37              151            1,986
      Net income                                                                                         1,427
      Diluted EPS                                                                                        $0.84
      Diluted shares used                                                                          1,697
      Nine Months - Fiscal Year 2005
                                                                                                              Total
                                                                    Tax                                  QUALCOMM
      Segments                                      Adjustments(5)(6)      QSI(4)         (GAAP)
      Revenues                                                 $--                    $--          $4,112
      EBT                                                          --                      37            2,023
      Net income                                                71                    107            1,605
      Diluted EPS                                         $0.04                 $0.06            $0.95
      Diluted shares used                            1,697                 1,697            1,697@@end@@

@@start.t9@@      (1) Reconciling items related to revenues consist primarily of other
            non-reportable segment revenues less intersegment eliminations.
            Reconciling items related to earnings before taxes consist primarily
            of corporate expenses, charges that are not allocated to the segments
            for management reporting purposes, unallocated net investment income,
            non-reportable segment results, interest expense and the elimination
            of intercompany profit.
      (2) During the first quarter of fiscal 2006, the Company adopted the fair
            value recognition provisions of FAS 123R using a modified prospective
            application. Under this method, prior periods are not revised for
            comparative purposes. Share-based compensation is included in
            operating expenses as part of employee-related costs but is not
            allocated to our segments as these estimated costs are not considered
            relevant by management in evaluating segment performance.
      (3) During the second quarter of fiscal 2006, the Company recorded
            US$21 million of expenses related to acquired in-process R&D
            associated with the acquisitions of Berkana Wireless Inc. and Flarion
            Technologies, Inc. For fiscal 2006 pro forma presentation, results
            have been adjusted to exclude these expenses as they are unrelated to
            the Company's ongoing core operating businesses and are also not
            allocated to our segments as these costs are not considered relevant
            by management in evaluating segment performance.
      (4) At fiscal year-end, the sum of the quarterly tax provisions for each
            column, including QSI, will equal the annual tax provisions for each
            column computed in accordance with GAAP. In interim quarters, the
            tax provision for the QSI operating segment is computed by
            subtracting the tax provision for QUALCOMM pro forma, the tax
            adjustment column and the tax provision related to estimated
            share-based compensation from the tax provision for total QUALCOMM
            (GAAP).
      (5) During the third quarter of fiscal 2005, the Company made an election
            to compute its California tax on the basis of its U.S. operations
            only, which resulted in a US$38 million tax benefit. Our effective
            tax rate in the third quarter of fiscal 2005 for total QUALCOMM
            (GAAP) includes a US$16 million tax benefit, or US$0.01 diluted
            earnings per share, for this California tax election related to
            fiscal 2004. For fiscal 2005 pro forma presentation, results have
            been adjusted to exclude the tax benefit attributable to fiscal 2004.
      (6) During the second quarter of fiscal 2005, the Company decreased its
            estimate of R&D costs allocable to the Company's foreign operations
            under an intercompany cost sharing agreement. Due to this change in
            estimate, the effective tax rate in the second quarter for total
            QUALCOMM (GAAP) included a US$55 million benefit, or US$0.03 diluted
            earnings per share, related to fiscal 2004. For fiscal 2005 pro
            forma presentation, results have been adjusted to exclude the tax
            benefit attributable to fiscal 2004.
      (7) During the first quarter of fiscal 2006, the Company recorded a
            US$56 million tax benefit, or US$0.03 per share, related to the
            expected impact of prior year tax audits completed during the
            quarter. For fiscal 2006 pro forma presentation, results have been
            adjusted to exclude this tax benefit attributable to prior years.
      N/M - Not Meaningful
      Sums may not equal totals due to rounding.@@end@@

@@start.t10@@      Business Segment Information
      QUALCOMM CDMA Technologies (QCT)
      - For the fourth consecutive quarter, we shipped a record number of MSM
         chips. Approximately 55 million MSM chips were shipped to customers
         worldwide during the third quarter of fiscal 2006, compared to
         approximately 36 million units in the same quarter of fiscal 2005 and
         approximately 49 million units in the second quarter of fiscal 2006.
      - We shipped a record number of cell site modem voice-equivalent channel
         elements in the quarter. This record was primarily driven by demand
         for the EV-DO Rev. A CSM6800 solution.
      - We sampled the first 65 nanometer (nm) chipset for EV-DO Rev. A ahead
         of schedule. Commercial devices based on EV-DO Rev. A are expected
         before the end of calendar year 2006.
      - Our WCDMA product portfolio was reinforced by the early sampling of
         three additional WCDMA/HSDPA chipsets in 65nm, which will help drive
         the migration of wireless users to 3G.
      - We introduced the Universal Broadcast Modem, or UBM product, that will
         allow manufacturers to leverage a common platform that supports FLO(TM)
         (Forward Link-Only), DVB-H, and one-segment ISDB-T for mobile TV on
         wireless devices.
      - We announced collaboration with Microsoft which features integrated
         support for Windows Mobile on Convergence Platform chipsets for
         EV-DO/EV-DO Rev. A and HSDPA/HSUPA networks. This joint effort will
         result in a wider range of Windows Mobile Smartphones leveraging MSM
         solutions to be available by early 2007.
      QUALCOMM Technology Licensing (QTL)
      - In the third quarter of fiscal 2006, five new licensees entered into
         CDMA license agreements including our first licensee in India. Two
         companies entered into licenses for CDMA2000 and three companies
         entered into licenses for WCDMA. In addition, two existing CDMA2000
         licensees signed amendments expanding their license to include WCDMA.
      - We entered into a royalty bearing license agreement with a licensee
         covering sales by that licensee of subscriber units implementing
         OFDM/OFDMA technologies, including WiMax, for a total of two OFDM/OFDMA
         licensees.
      - Licensee information for the second quarter of fiscal 2006 as reported
         by licensees in the third quarter of fiscal 2006:
         - Worldwide shipments of approximately 66 million CDMA2000 and WCDMA
            subscriber units at an average selling price of approximately
            US$213 were reported.
         - We estimate WCDMA royalties contributed approximately 47 percent of
            total royalties reported compared to approximately 46 percent
            reported in the prior quarter and approximately 36 percent in the
            year ago quarter.
      QUALCOMM Wireless & Internet Group (QWI)
      QUALCOMM Internet Services (QIS)
      - QUALCOMM has 69 BREW(R) customers in 31 countries. In June 2006, we
         announced that publishers and developers have earned more than
         US$700 million in revenues to date from the sale of BREW applications
         and services, compared to the more than US$350 million announced in
         June 2005, evidencing the continued growth and success of the entire
         BREW wireless value chain.
      QUALCOMM Wireless Business Solutions(R) (QWBS)
      - We shipped approximately 10,700 satellite-based systems (OmniTRACS(R),
         EutelTRACS(TM) and TruckMAIL(TM)) in the third quarter of fiscal 2006,
         compared to approximately 13,800 in the third quarter of fiscal 2005
         and approximately 8,200 in the second quarter of fiscal 2006. This
         brings the cumulative total satellite-based systems shipped worldwide
         to more than 597,000.
      - We shipped approximately 5,500 terrestrial-based systems
         (OmniExpress(R), GlobalTRACS(R) and T2 Untethered TrailerTRACS(TM)) in
         the third quarter of fiscal 2006, compared to approximately
         19,600 terrestrial-based systems in the third quarter of fiscal 2005
         and approximately 8,000 terrestrial-based systems in the second quarter
         of fiscal 2006. This brings the cumulative total terrestrial-based
         systems shipped worldwide to nearly 114,000.
      QUALCOMM Strategic Initiatives (QSI)
      - QUALCOMM's subsidiary, MediaFLO USA Inc. (MediaFLO USA), opened its
         Broadcast Operation Center (BOC) and Network Operations Center (NOC) in
         San Diego. Currently, MediaFLO USA is using the BOC and NOC to conduct
         service trials and in preparation for Verizon Wireless' expected launch
         of MediaFLO services.
      Other
      - In July 2006, the Telecommunications Industry Association (TIA)
         officially approved publication of the FLO Air Interface Specification
         (AIS). The AIS was the first technical specification produced and
         approved by the FLO Forum, an association of 45 wireless industry
         leaders committed to advancing the global standardization of FLO
         technology. The FLO Forum is playing a key role in making FLO
         specifications open and uniform for developers, which aligns with the
         TIA's desire to standardize the technologies needed by industry for use
         in Terrestrial Mobile Multimedia Multicast.
      - We entered into a nonbinding letter of intent with British Sky
         Broadcasting Limited (BSkyB) in May 2006 to conduct technical trials of
         our MediaFLO technology in the United Kingdom.
      - In May 2006, we announced that the issuance of certain patents to our
         subsidiary QUALCOMM Flarion Technologies triggered the payment of
         additional consideration valued at approximately US$205 million to the
         former stockholders and option holders of Flarion Technologies, Inc.,
         of which US$197 million was recorded as goodwill with the remainder
         expected to be recorded as share-based compensation over the vesting
         periods of the related options.@@end@@

    Conference Call

    QUALCOMM's third quarter fiscal 2006 earnings conference call will be broadcast live on July 19, 2006 beginning at 1:45 p.m. Pacific Daylight Time on the Company's web site at: www.qualcomm.com. This conference call may contain forward-looking financial information. The conference call will include a discussion of "non-GAAP financial measures" as that term is defined in Regulation G. The most directly comparable GAAP financial measures and information reconciling these non-GAAP financial measures to the Company's financial results prepared in accordance with GAAP, as well as the other material financial and statistical information to be discussed in the conference call, will be posted on the Company's Investor Relations web site at www.qualcomm.com immediately prior to commencement of the call. A taped audio replay will be available via telephone on July 19, 2006 beginning at approximately 5:30 p.m. (PDT) through August 2, 2006 at 5:30 p.m. (PDT). To listen to the replay, U.S. callers may dial +1-800-642-1687 and international callers may dial +1-706-645-9291. U.S. and international callers should use reservation number 7439642. An audio replay of the conference call will be available on the Company's web site at www.qualcomm.com for two weeks following the live call.

    QUALCOMM Incorporated (www.qualcomm.com) is a leader in developing and delivering innovative digital wireless communications products and services based on CDMA and other advanced technologies. Headquartered in San Diego, Calif., QUALCOMM is included in the S&P 500 Index and is a 2006 FORTUNE 500(R) company traded on The Nasdaq Stock Market(R) under the ticker symbol QCOM.

    Note Regarding Use of Non-GAAP Financial Measures

    The Company presents pro forma financial information that is used by management (i) to evaluate, assess and benchmark the Company's operating results on a consistent and comparable basis, (ii) to measure the performance and efficiency of the Company's ongoing core operating businesses, including the QUALCOMM CDMA Technologies, QUALCOMM Technology Licensing and QUALCOMM Wireless & Internet segments, and (iii) to compare the performance and efficiency of these segments against each other and against competitors outside the Company. Pro forma measurements of the following financial data are used by the Company's management: revenues, R&D expenses, SG&A expenses, total operating expenses, operating income, net investment income, income before income taxes, effective tax rate, net income, diluted earnings per share, operating cash flow and free cash flow.

    Pro forma information used by management excludes the QUALCOMM Strategic Initiatives (QSI) segment, estimated share-based compensation, certain tax benefits related to prior years and acquired in-process R&D expense. The QSI segment is excluded because the Company expects to exit its strategic investments at various times and the effects of fluctuations in the value of such investments are viewed by management as unrelated to the Company's operational performance. Estimated share-based compensation is excluded because management views the valuation of options and other share-based compensation as theoretical and unrelated to the Company's operational performance as it is affected by factors that are subject to change on each grant date including the Company's stock price, stock market volatility, expected option life, risk-free interest rates and expected dividend payouts in future years. Moreover, it is not an expense that requires or will require cash payment by the Company. Certain tax benefits related to prior years are excluded in order to provide a clearer understanding of the Company's ongoing tax rate and after tax earnings. Acquired in-process R&D expense in fiscal 2006 is excluded because such expense is incurred infrequently and is viewed by management as unrelated to the operating activities of the Company's ongoing core businesses.

    Management is able to assess what it believes is a more meaningful and comparable set of financial performance measures for the Company and its business segments by eliminating the episodic impact of strategic investments in QSI and items such as acquired in-process R&D, as well as the inherent, non-operational volatility of share-based compensation. As a result, management compensation decisions and the review of executive compensation by the Compensation Committee of the Board of Directors focus primarily on pro forma financial measures applicable to the Company and its business segments.

    The Company's management uses pro forma cash flow information including marketable securities to analyze increases and decreases in certain of its liquid assets, comprised of cash, cash equivalents and marketable securities. Management views certain marketable securities as liquid assets available on short notice to fund operations, acquisitions, strategic initiatives, stock repurchases and dividends even though these marketable securities do not meet the definition of cash equivalents in accordance with Statement of Financial Accounting Standards No. 95, "Statement of Cash Flows." The GAAP statements of cash flows present the purchases and sales of marketable securities as inflows and outflows. For internal analysis of the Company's cash position, management does not view these transactions as inflows and outflows from the business, but as cash management transactions. The Company believes that this non-GAAP presentation is a helpful and practical measure of the Company's liquidity.

    The Company presents free cash flow, defined as net cash provided by operating activities less capital expenditures, to facilitate an understanding of the amount of cash flow generated that is available to grow its business and to create long-term shareholder value. The Company believes that this presentation is useful in evaluating its operating performance and financial strength. In addition, management uses this measure to value the Company and to compare its operating performance with other companies in the industry.

    The non-GAAP pro forma financial information presented herein should be considered in addition to, not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. In addition, pro forma is not a term defined by GAAP, and, as a result, the Company's measure of pro forma results might be different than similarly titled measures used by other companies. Reconciliations between total QUALCOMM (GAAP) results and QUALCOMM pro forma results and total QUALCOMM (GAAP) cash flow and QUALCOMM pro forma changes in cash, cash equivalents and marketable securities are presented herein.

    Note Regarding Forward-Looking Statements

    In addition to the historical information contained herein, this news release contains forward-looking statements that are subject to risks and uncertainties. Actual results may differ substantially from those referred to herein due to a number of factors, including but not limited to risks associated with: the rate of development, deployment and commercial acceptance of CDMA-based networks and CDMA-based technology, including CDMA2000 1X, 1xEV-DO, WCDMA and HSDPA both domestically and internationally;  our dependence on major customers and licensees; fluctuations in the demand  for CDMA-based products, services or applications; foreign currency  fluctuations; strategic loans, investments and transactions the Company has  or may pursue; our dependence on third party manufacturers and suppliers; our  ability to maintain and improve operational efficiencies and profitability;  developments in current and future litigation; the development, deployment  and commercial acceptance of the MediaFLO USA network and FLO technology; as  well as the other risks detailed from time-to-time in the Company's SEC  reports.

    (C) 2006 QUALCOMM Incorporated. All rights reserved. QUALCOMM is a registered trademark of QUALCOMM Incorporated. CDMA2000(R) is a registered trademark of the Telecommunications Industry Association. All other trademarks are the property of their respective owners.

      QUALCOMM Contact:
      Bill Davidson
      Vice President, Investor Relations
      +1-858-658-4813 (ph) +1-858-651-9303 (fax)
      e-mail: ir@qualcomm.com

@@start.t11@@      (All figures are in US$)
                                                QUALCOMM Incorporated
                          CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  THIS SCHEDULE IS TO ASSIST THE READER IN RECONCILING FROM
                              PRO FORMA RESULTS TO TOTAL QUALCOMM RESULTS
                                  (In millions, except per share data)
                                                        (Unaudited)
                                                          Three Months Ended June 25, 2006
                                                                        Estimated                    Total
                                                 QUALCOMM        Share-Based                 QUALCOMM
                                                 Pro Forma      Compensation      QSI      (GAAP)
      Revenues:
         Equipment and services      $1,240                $--              $--      $1,240
         Licensing and royalty
          fees                                      711                 --                --          711
                Total revenues              1,951                 --                --        1,951
      Operating expenses:
         Cost of equipment and
          services revenues                 549                 10                --          559
         Research and development        322                 56                17          395
         Selling, general and
          administrative                      214                 60                19          293
                Total operating
                 expenses                      1,085                126                36        1,247
      Operating income (loss)            866              (126)            (36)         704
      Investment income, net              110(a)            --                10(b)      120
      Income (loss) before income
        taxes                                        976              (126)            (26)         824
      Income tax (expense)
        benefit                                  (250)(c)          43                26(d)    (181)(c)
      Net income (loss)                    $726              $(83)            $--         $643
      Earnings (loss) per common
        share:
          Diluted                              $0.42          $(0.05)            $--        $0.37
      Shares used in per share
        calculations:
          Diluted                              1,728            1,728          1,728        1,728
      Supplemental Financial Data:
      Operating Cash Flow                 $954            $(103)(f)      $(35)        $816
      Operating Cash Flow as a %
        of Revenue                                 49%                                                  42%
      Free Cash Flow (e)                  $795            $(103)(f)      $(58)        $634
      Free Cash Flow as a % of
        Revenue                                      41%                                                  32%
      (a)  Includes US$117 million in interest and dividend income related to
              cash, cash equivalents and marketable securities, which are not part
              of the Company's strategic investment portfolio, and US$22 million
              in net realized gains on investments, partially offset by US$24
              million in losses on derivative instruments, primarily related to
              the increase in the fair value of the put option liabilities related
              to our share repurchase program, and US$5 million in other-than-
              temporary losses on investments.
      (b)  Includes US$12 million in net realized gains on investments and
              US$3 million in interest and dividend income, partially offset by
              US$4 million in other-than-temporary losses on investments and
              US$1 million in interest expense.
      (c)  The third quarter of fiscal 2006 tax rate of 22% for total QUALCOMM
              (GAAP) and 26% for QUALCOMM pro forma are consistent with the fiscal
              year 2006 estimated effective tax rates.
      (d)  At fiscal year-end, the sum of the quarterly tax provisions for each
              column, including QSI, will equal the annual tax provisions for each
              column computed in accordance with GAAP.  In interim quarters, the
              tax provision for the QSI operating segment is computed by
              subtracting the tax provision for QUALCOMM pro forma and the tax
              provision related to estimated share-based compensation from the tax
              provision for total QUALCOMM (GAAP).
      (e)  Free Cash Flow is calculated as net cash provided by operating
              activities less capital expenditures.  Reconciliation of these
              amounts is included in the Condensed Consolidated Statements of Cash
              Flows and Marketable Securities for the three months ended June 25,
              2006, included herein.
      (f)  Tax benefits from stock options exercised during the quarter.@@end@@

@@start.t12@@                                                QUALCOMM Incorporated
                          CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  THIS SCHEDULE IS TO ASSIST THE READER IN RECONCILING FROM
                              PRO FORMA RESULTS TO TOTAL QUALCOMM RESULTS
                                  (In millions, except per share data)
                                                        (Unaudited)
                                              Nine Months Ended June 25, 2006
                                                Estimated                          In-              Total
                            QUALCOMM    Share-Based         Tax        Process         QUALCOMM
                            Pro Forma  Compensation  Adjustment  R&D        QSI  (GAAP)
      Revenues:
        Equipment
         and
         services        $3,512            $--                $--         $--        $--    $3,512
        Licensing
         and
         royalty
         fees                2,015              --                 --          --         --      2,015
         Total
          revenues        5,527              --                 --          --         --      5,527
      Operating
        expenses:
        Cost of
         equipment
         and
         services
         revenues         1,564              32                 --          --         --      1,596
        Research and
         development        897            160                 --          21         48      1,126
        Selling,
         general and
         administrative  570            176                 --          --         49         795
         Total
          operating
          expenses        3,031            368                 --          21         97      3,517
      Operating
        income
        (loss)              2,496          (368)                            (21)      (97)    2,010
      Investment
        income
        (expense),
        net                      349(a)         --                 --          --        (13)(b)  336
      Income (loss)
        before income
        taxes                2,845          (368)                --         (21)    (110)    2,346
      Income tax
        (expense)
        benefit              (747)(c)      125                 56          --         76(d)  (490)
        Net income
         (loss)          $2,098         $(243)              $56        $(21)    $(34)  $1,856
      Earnings (loss)
        per common
        share:
        Diluted            $1.22        $(0.14)          $0.03    $(0.01) $(0.02)    $1.08
      Shares used
        in per share
        calculations:
        Diluted            1,717         1,717            1,717      1,717    1,717      1,717
      Supplemental
        Financial
        Data:
      Operating
         Cash Flow      $2,739         $(376)(f)         $--         $--      $(62)  $2,301
      Operating
        Cash Flow as
        a % of Revenue      50%                                                                          42%
      Free Cash
        Flow(e)          $2,273         $(376)(f)         $--         $--    $(152)  $1,745
      Free Cash Flow
        as a % of
        Revenue                 41%                                                                          32%
      (a)  Includes US$309 million in interest and dividend income related to
              cash, cash equivalents and marketable securities, which are not part
              of the Company's strategic investment portfolio, and US$76 million
              in net realized gains on investments, partially offset by US$17
              million in losses on derivative instruments, primarily related to
              the increase in the fair values of the put option liabilities
              related to our share repurchase program, US$17 million in other-
              than-temporary losses on investments and US$2 million of interest
              expense.
      (b)  Includes US$30 million in equity in losses of investees, US$3
              million in other-than-temporary losses on investments and US$1
              million of interest expense, partially offset by US$18 million in
              net realized gains on investments and US$3 million in interest and
              dividend income.
      (c)  The tax rate of 21% for the first nine months of fiscal 2006 for
              total QUALCOMM (GAAP) is lower than the estimated annual effective
              tax rate of 22% due primarily to US$56 million of tax benefits
              recorded in the first quarter related to the expected impact of
              prior year tax audits completed in that quarter.
      (d)  At fiscal year-end, the sum of the quarterly tax provisions for each
              column, including QSI, will equal the annual tax provisions for each
              column computed in accordance with GAAP.  In interim quarters, the
              tax provision for the QSI operating segment is computed by
              subtracting the tax provision for QUALCOMM pro forma, the tax
              adjustment column and the tax provision related to estimated
              share-based compensation from the tax provision for total QUALCOMM
              (GAAP).
      (e)  Free Cash Flow is calculated as net cash provided by operating
              activities less capital expenditures.  Reconciliation of these
              amounts is included in the Condensed Consolidated Statements of Cash
              Flows and Marketable Securities for the nine months ended June 25,
              2006, included herein.
      (f)  Tax benefits from stock options exercised during the quarter.@@end@@

@@start.t13@@                                                QUALCOMM Incorporated
      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AND MARKETABLE SECURITIES
              THIS SCHEDULE IS TO ASSIST THE READER IN RECONCILING PRO FORMA
      CASH FLOWS FROM CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES TO TOTAL
                                              QUALCOMM CASH FLOWS
                                                      (In millions)
                                                        (Unaudited)
                                                          Three Months Ended June 25, 2006
                                                                      Estimated                         Total
                                                QUALCOMM        Share-Based                      QUALCOMM
                                                Pro Forma      Compensation      QSI          (GAAP)
      Earnings before taxes,
        depreciation,
        amortization and other
        adjustments(1)                  $1,035              $(103)         $(29)          $903
      Working capital changes
        and taxes paid(2)                  (81)                 --              (6)            (87)
      Net cash provided (used)
        by operating activities         954                (103)          (35)            816
      Capital expenditures              (159)                 --            (23)          (182)
      Free cash flow (Net cash
        provided by operating
        activities less capital
        expenditures)                         795                (103)          (58)            634
      Net additional share
        capital                                  155                  --              --              155
      Repurchase and retirement
        of common stock                 (1,165)                 --              --         (1,165)
      Tax benefits from stock
        options exercised during
        the quarter                              --                 103              --              103
      Dividends paid                        (202)                 --              --            (202)
      Other investments and
        acquisitions, net of cash
        acquired                                (113)                 --              (7)          (120)
      Other items, net                        11                  --                5                16
      Changes in fair value and
        other changes to
        marketable securities          (102)                 --              23              (79)
      Marketable securities
        pending settlement                 (31)                 --              --              (31)
      Transfer from QSI(3)                 20                  --            (20)              --
      Transfer to QSI(4)                  (67)                 --              67                --
      Net (decrease) increase
        in cash, cash equivalents
        and marketable
        securities(5)                      $(699)                $--            $10          $(689)
      (1) Reconciliation to GAAP:
            Net income (loss)            $726                $(83)          $--            $643
            Share-based
              compensation, net of
              tax benefit                        --                  83              --                83
            Other non-cash
              adjustments (a)                305                (103)(b)      (17)            185
            Net realized gains on
              marketable securities
              and other investments      (22)                 --            (12)            (34)
            Net taxes paid                    26                  --              --                26
            Earnings before taxes,
              depreciation,
              amortization and
              other adjustments        $1,035              $(103)         $(29)          $903
      (2) Reconciliation to GAAP:
            Increase in cash
              resulting from
              changes in working
              capital                            (55)                $--            $(6)          $(61)
            Net taxes paid                  (26)                 --              --              (26)
            Working capital
              changes and taxes
              paid                                $(81)                $--            $(6)          $(87)
      (3) Cash from loan
              payments and sale of
              equity securities.
      (4) Funding for strategic
              debt and equity
              investments and other
              QSI operating expenses.
      (5) Reconciliation to GAAP
              cash flow statement:
              Net decrease in cash
                and cash equivalents
                (GAAP)                         $(624)                $--            $--          $(624)
              Net purchases
                and maturities of
                marketable
                securities                        58                  --            (13)              45
              Net (decrease)
                increase in
                fair value and
                other changes to
                marketable
                securities                  (102)                  --              23              (79)
              Net decrease
                in marketable
                securities pending
                settlement                    (31)                  --              --              (31)
              Net (decrease)
                increase in cash,
                cash equivalents and
                marketable
                securities                 $(699)                 $--            $10          $(689)
        (a) See detail below.
        (b) Tax benefits from stock options exercised during the quarter.@@end@@

@@start.t14@@                                                QUALCOMM Incorporated
      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AND MARKETABLE SECURITIES
              THIS SCHEDULE IS TO ASSIST THE READER IN RECONCILING PRO FORMA
      CASH FLOWS FROM CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES TO TOTAL
                                              QUALCOMM CASH FLOWS
                                                      (In millions)
                                                        (Unaudited)
                                                    Nine Months Ended June 25, 2006
                                                 Estimated                          In-                 Total
                              QUALCOMM    Share-Based         Tax        Process          QUALCOMM
                              Pro Forma  Compensation  Adjustment    R&D      QSI    (GAAP)
      Earnings
        before
        taxes,
        depreciation,
        amortization
        and other
        adjustments(1)    $2,942        $(376)            $--          $--    $(86)  $2,480
      Working capital
        changes and
        taxes paid (2)        (203)          --                --            --        24        (179)
      Net cash
        provided (used)
        by operating
        activities            2,739         (376)              --            --      (62)    2,301
      Capital
        expenditures          (466)          --                --            --      (90)      (556)
      Free cash flow
        (Net cash
        provided by
        operating
        activities less
        capital
        expenditures)        2,273         (376)              --            --    (152)    1,745
      Net additional
        share capital          623            --                --            --        --         623
      Repurchase and
        retirement of
        common stock        (1,165)          --                --            --        --    (1,165)
      Tax benefits
        from stock
        options
        exercised
        during the
        period                        --          376                --            --        --         376
      Dividends paid         (500)          --                --            --        --        (500)
      Other
        investments
        and
        acquisitions,
        net of cash
        acquired                 (376)          --                --            --      (14)      (390)
      Other items, net         11            --                --            --         9          20
      Changes in fair
        value and other
        changes to
        marketable
        securities                 11            --                --            --        48          59
      Marketable
        securities
        pending
        settlement                 29            --                --            --        --          29
      Transfer from
        QSI(3)                        41            --                --            --      (41)         --
      Transfer to
        QSI(4)                    (170)          --                --            --      170          --
      Net increase in
        cash, cash
        equivalents and
        marketable
        securities(5)         $777          $--              $--          $--      $20        $797
      (1) Reconciliation
              to GAAP:
              Net income
                (loss)         $2,098        $(243)            $56         $(21)  $(34)  $1,856
              Share-based
                compensation,
                net of tax
                benefit              --          243                --            --        --         243
              Other
                non-cash
                adjustments
                (a)                  806         (376)(b)        (56)          21      (34)        361
              Net realized
                gains on
                marketable
                securities
                and other
                investments      (76)          --                --            --      (18)        (94)
              Net taxes
                paid                 114            --                --            --        --         114
              Earnings
                before taxes,
                depreciation,
                amortization
                and other
                adjustments $2,942        $(376)            $--          $--    $(86)  $2,480
      (2) Reconciliation
              to GAAP:
              Increase
                in cash
                resulting
                from changes
                in working
                capital          $(89)         $--              $--          $--      $24        $(65)
              Net taxes
                paid                (114)          --                --            --        --        (114)
              Working
                capital
                changes
                and taxes
                paid              $(203)         $--              $--          $--      $24      $(179)
      (3) Cash from
              loan payments
              and sale of
              equity
              securities.
      (4) Funding for
              strategic debt
              and equity
              investments
              and other QSI
              operating
              expenses.
      (5) Reconciliation
              to GAAP cash
              flow statement:
              Net decrease
                in cash and
                cash
                equivalents
                (GAAP)          $(915)         $--              $--          $--      $--      $(915)
              Net
                purchases
                and
                maturities of
                marketable
                securities    1,652            --                --            --      (28)    1,624
              Net
                increase in
                fair value
                and other
                changes to
                marketable
                securities         11            --                --            --        48          59
              Net
                increase in
                marketable
                securities
                pending
                settlement         29            --                --            --        --          29
              Net increase
                in cash, cash
                equivalents
                and
                marketable
                securities      $777          $--              $--          $--      $20        $797
        (a) See detail below.
        (b) Tax benefits from stock options exercised during the period.@@end@@

@@start.t15@@                                                QUALCOMM Incorporated
                                          SUPPLEMENTAL DETAIL TO THE
      CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AND MARKETABLE SECURITIES
                                                      (In millions)
                                                        (Unaudited)
                                                            Three Months Ended June 25, 2006
                                                                         Estimated                      Total
                                                    QUALCOMM      Share-Based                  QUALCOMM
                                                    Pro Forma    Compensation      QSI        (GAAP)
      (a) Other non-cash
              adjustments are
              comprised of:
            Depreciation and
              amortization                        $66                $--                $3          $69
            Tax benefits from stock
              options exercised during
              the quarter                          --              (103)              --         (103)
            Non-cash income tax
              expense (benefit)                224                 --              (26)         198
            Other non-cash charges          15                 --                 6            21
      Total non-cash adjustments        $305            $(103)          $(17)        $185
                                                    Nine Months Ended June 25, 2006
                                                 Estimated                          In-                Total
                              QUALCOMM    Share-Based         Tax        Process          QUALCOMM
                              Pro Forma  Compensation  Adjustment    R&D      QSI    (GAAP)
      (a) Other
              non-cash
              adjustments
              are
              comprised
              of:
            Depreciation
              and
              amortization $184            $--                $--          $--      $6        $190
            Tax benefits
              from stock
              options
              exercised
              during the
              period              --          (376)                --            --      --        (376)
            Non-cash
              income tax
              expense
              (benefit)        632              --                (56)          --    (76)        500
            Other
              non-cash
              charges and
              (credits)        (10)            --                 --            21      36          47
            Total
              non-cash
              adjustments  $806         $(376)            $(56)         $21  $(34)      $361@@end@@

@@start.t16@@                      RECONCILIATION OF PRIOR YEAR PRO FORMA FREE CASH FLOW
                            TO NET CASH PROVIDED BY OPERATING ACTIVITIES
                                                      (In millions)
                                                        (Unaudited)
                                                                        Three Months Ended June 26, 2005
                                                                                                          Total
                                                                          QUALCOMM                 QUALCOMM
                                                                          Pro forma      QSI      (GAAP)
      Net cash provided by operating activities      $520            $3        $523
      Capital expenditures                                        (152)          (4)      (156)
      Free cash flow (Net cash provided by
        operating activities less capital
        expenditures)                                                 $368          $(1)      $367
                                                                         Nine Months Ended June 26, 2005
                                                                                                              Total
                                                                              QUALCOMM                 QUALCOMM
                                                                              Pro Forma      QSI      (GAAP)
      Net cash provided by operating activities        $1,741         $--      $1,741
      Capital expenditures                                            (356)        (82)      $(438)
      Free cash flow (Net cash provided by
        operating activities less capital
        expenditures)                                                  $1,385        $(82)    $1,303
                                                QUALCOMM Incorporated
                                  CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (In millions, except per share data)
                                                        (Unaudited)
                                                          ASSETS
                                                                              June 25,          September 25,
                                                                                2006                      2005
      Current assets:
        Cash and cash equivalents                              $1,155                  $2,070
        Marketable securities                                      4,716                    4,478
        Accounts receivable, net                                    695                        544
        Inventories                                                         259                        177
        Deferred tax assets                                            316                        343
        Other current assets                                          133                        179
          Total current assets                                    7,274                    7,791
      Marketable securities                                        3,607                    2,133
      Property, plant and equipment, net                  1,420                    1,022
      Goodwill                                                            1,236                        571
      Deferred tax assets                                              483                        444
      Other assets                                                         693                        518
          Total assets                                              $14,713                 $12,479
                                 LIABILITIES AND STOCKHOLDERS' EQUITY
      Current liabilities:
        Trade accounts payable                                      $501                      $376
        Payroll and other benefits related
         liabilities                                                        241                        196
        Unearned revenue                                                 176                        163
        Other current liabilities                                  418                        335
          Total current liabilities                            1,336                    1,070
      Unearned revenue                                                  144                        146
      Other liabilities                                                 235                        144
          Total liabilities                                         1,715                    1,360
      Stockholders' equity:
        Preferred stock, $0.0001 par  value;
         issuable in series; 8 shares authorized;
         none outstanding at June 25, 2006 and
         September 25, 2005, respectively                        --                         --
        Common stock, $0.0001 par value;
         6,000 shares authorized; 1,656 and
         1,640 shares issued and outstanding
         at June 25, 2006 and September 25, 2005,
         respectively                                                        --                         --
        Paid-in capital                                                7,325                    6,753
        Retained earnings                                            5,684                    4,328
        Accumulated other comprehensive (loss)
         income                                                                (11)                        38
          Total stockholders' equity                         12,998                  11,119
          Total liabilities and stockholders'
            equity                                                      $14,713                 $12,479@@end@@

@@start.t17@@                                                QUALCOMM Incorporated
                          CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (In millions, except per share data)
                                                        (Unaudited)
                                                          Three Months Ended    Nine Months Ended
                                                          June 25,  June 26,    June 25,  June 26,
                                                              2006         2005          2006         2005
      Revenues:
        Equipment and services                 $1,240        $882         $3,512      $2,708
        Licensing and royalty fees                711         476          2,015        1,404
          Total revenues                            1,951      1,358          5,527        4,112
      Operating expenses:
        Cost of equipment and services
         revenues                                          559         389          1,596        1,204
        Research and development                  395         259          1,126          740
        Selling, general and
         administrative                                 293         150              795          452
          Total operating expenses            1,247         798          3,517        2,396
      Operating income                                 704         560          2,010        1,716
      Investment income, net                        120         126              336          307
      Income before income taxes                 824         686          2,346        2,023
      Income tax expense                            (181)      (126)          (490)        (418)
      Net income                                         $643        $560         $1,856      $1,605
      Basic earnings per common share      $0.38      $0.34          $1.12        $0.98
      Diluted earnings per common share  $0.37      $0.33          $1.08        $0.95
      Shares used in per share
        calculations:
         Basic                                            1,675      1,633          1,661        1,640
         Diluted                                         1,728      1,683          1,717        1,697
      Dividends per share paid                 $0.12      $0.09          $0.30        $0.23
      Dividends per share announced         $0.12      $0.09          $0.30        $0.23@@end@@

    Web site: http://www.qualcomm.com

ots Originaltext: Qualcomm Incorporated
Im Internet recherchierbar: http://www.presseportal.ch

Contact:
Bill Davidson, Vice President, Investor Relations of QUALCOMM
Incorporated, +1-858-658-4813, or fax, +1-858-651-9303,
ir@qualcomm.com /NOTE TO EDITORS:  If you would like additional
information on QUALCOMM, please view the QUALCOMM press room at
http://www.qualcomm.com/press/index.html .



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