Qualcomm Incorporated

QUALCOMM Announces First Quarter Fiscal 2007 Results

    San Diego (ots/PRNewswire) -

    - Revenues US$2.02 Billion, Diluted EPS US$0.38

    - Pro Forma Revenues US$2.02 Billion, Diluted EPS US$0.43

    - QUALCOMM Reaffirms Most Recent Fiscal 2007 Revenue and Pro Forma Earnings Guidance

    QUALCOMM Incorporated (Nasdaq: QCOM) today announced results for the first quarter of fiscal 2007 ended December 31, 2006.

    Total QUALCOMM (GAAP) First Quarter Results

    Total QUALCOMM results are reported in accordance with generally accepted accounting principles (GAAP).

@@start.t1@@      - Revenues: US$2.02 billion, up 16 percent year-over-year and 1 percent
         sequentially.
      - Net income: US$648 million, up 5 percent year-over-year and 6 percent
         sequentially.
      - Diluted earnings per share: US$0.38, up 6 percent year-over-year and
         6 percent sequentially.
      - Effective tax rate: 17 percent for the quarter. Fiscal 2007 estimated
         tax rate of approximately 21 percent.
      - Estimated share-based compensation: US$87 million, net of tax, up
         6 percent year-over-year and 14 percent sequentially.
      - Operating cash flow: US$789 million, up 32 percent year-over-year;
         39 percent of revenues.
      - Return of capital to stockholders: in the quarter, dividends announced
         totaled US$198 million, or US$0.12 per share, which were paid on
         January 4, 2007, and US$96 million related to the repurchase of our
         common stock.@@end@@

    QUALCOMM Pro Forma First Quarter Results

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

@@start.t2@@      - Revenues: US$2.02 billion, up 16 percent year-over-year and 1 percent
         sequentially.
      - Net income: US$722 million, up 8 percent year-over-year and 2 percent
         sequentially.
      - Diluted earnings per share: US$0.43, up 10 percent year-over-year and
         2 percent sequentially; excludes US$0.01 loss per share attributable to
         the QSI segment, US$0.05 loss per share attributable to estimated
         share-based compensation and US$0.02 earnings per share attributable to
         certain tax adjustments related to prior years. (The sum of pro forma
         earnings per share and items excluded do not equal total QUALCOMM
         (GAAP) earnings per share due to rounding).
      - Effective tax rate: 24 percent for the quarter. Fiscal 2007
         estimated tax rate of approximately 25 percent.
      - Free cash flow: US$544 million, up 2 percent year-over-year; 27 percent
         of revenues. (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 flow 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 record 3G handset and chipset shipments," said Dr. Paul E. Jacobs, chief executive officer of QUALCOMM. "The worldwide migration to CDMA-based technologies is accelerating as we continue to execute with our partners to drive innovations into the marketplace."

    "An increasing number of subscribers and enterprise customers are benefiting from 3G's higher data rates enabling new applications including multimedia, 3D gaming, downloadable navigation and access to the wireless Internet. It is evident that the innovation and competition our business model enables has benefited wireless consumers, operators and manufacturers globally."

    "Based on our current outlook for CDMA-based handset shipments, we are pleased to reaffirm our calendar year 2007 forecast which represents approximately 28% year-over-year growth. We are also reaffirming our most recent fiscal 2007 revenue and pro forma diluted earnings per share guidance as adjusted by our recently announced acquisitions."

    Cash and Marketable Securities

    QUALCOMM's cash, cash equivalents and marketable securities totaled approximately US$10.5 billion at the end of the first quarter of fiscal 2007, compared to US$9.9 billion at the end of fiscal 2006 and US$9.4 billion a year ago. On January 12, 2007, we announced a cash dividend of US$0.12 per common share payable on March 30, 2007 to stockholders of record at the close of business on March 2, 2007.

    Estimated Share-Based Compensation

    Total QUALCOMM (GAAP) net income for the first quarter of fiscal 2007 included estimated share-based compensation, net of tax, of US$87 million, or US$0.05 per share, compared to US$82 million, or US$0.05 per share in the prior year quarter.

@@start.t3@@      Research and Development
      (All figures are in US$)
                                                                        Estimated                         Total
                                                 QUALCOMM        Share-Based                      QUALCOMM
      ($ in millions)                 Pro Forma        Compensation        QSI         (GAAP)
      First quarter fiscal 2007      $365                 $58                $17          $440
      As a % of revenue                      18%                                                        22%
      First quarter fiscal 2006      $273                 $52                $15          $340
      As a % of revenue                      16%                                                        20%
      Year-over-year change ($)         34%                 12%                13%            29%@@end@@

    Pro forma R&D expenses increased 34 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 multi-mode, multi-band, multi-network products and technologies.

@@start.t4@@      Selling, General and Administrative
                                                                        Estimated                         Total
                                                 QUALCOMM        Share-Based                      QUALCOMM
      ($ in millions)                  Pro Forma        Compensation        QSI         (GAAP)
      First quarter fiscal 2007      $282                 $62                $25          $369
      As a % of revenue                      14%                                                        18%
      First quarter fiscal 2006      $168                 $58                $13          $239
      As a % of revenue                      10%                                                        14%
      Year-over-year change ($)         68%                  7%                92%            54%@@end@@

    Pro forma selling, general and administrative (SG&A) expenses increased 68 percent year-over-year, largely attributable to increases in legal fees and employee related expenses. The year-over-year increase in QSI SG&A expenses is primarily related to MediaFLO(TM) USA.

    Effective Income Tax Rate

    Our fiscal 2007 effective income tax rates are estimated to be 21 percent for total QUALCOMM (GAAP) and 25 percent for QUALCOMM pro forma, compared to fiscal 2006 effective income tax rates of 22 percent for total QUALCOMM (GAAP) and 26 percent for QUALCOMM pro forma. During the first quarter of fiscal 2007, the federal research and development tax credit that expired on December 31, 2005 was extended by Congress for a period of two years beyond the prior expiration date. We recorded a tax benefit of US$33 million, or US$0.02 diluted earnings per share, related to fiscal 2006 in the first quarter of fiscal 2007 due to this retroactive extension. The effective tax rate for the first quarter of fiscal 2007 for total QUALCOMM (GAAP) was 17%, primarily as a result of this benefit. Our first quarter fiscal 2007 QUALCOMM pro forma results exclude this tax benefit attributable to fiscal 2006.

    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 first quarter of fiscal 2007 include US$0.01 loss per share for the QSI segment. The first quarter of fiscal 2007 QSI results included US$42 million in operating expenses, primarily related to MediaFLO USA.

    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. 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.

    The following table summarizes total QUALCOMM (GAAP) and QUALCOMM pro forma guidance for the second fiscal quarter and fiscal year 2007 based on the current business outlook. The pro forma business outlook provided below is presented consistent with the presentation of pro forma results provided elsewhere herein.

    Our license agreement with Nokia Corp. expires in part on April 9, 2007, with Nokia having an option exercisable through the end of 2008 to extend the agreement. The table includes a footnote to size our estimate of the risk, approximately US$0.04 to US$0.06 diluted earnings per share, of Nokia not paying royalties in the fourth quarter of fiscal 2007 for June quarter shipments. Nokia has publicly stated that they intend to continue to use our patents but not pay royalties after the expiration of their rights under those patents on April 9, 2007 should a new license agreement (or extension of the existing agreement) not be reached by that time. As a result, under generally accepted accounting principles, we will be unable to record royalty revenue attributable to Nokia's sales until a court awards damages or agreement with Nokia is reached. If we cannot conclude an extension or a new license agreement beyond April 9, 2007, Nokia's rights to sell certain subscriber products (such as cellular phones and wireless personal digital assistant devices) under most of our patents will expire, as will our rights to sell integrated circuits under Nokia's patents. We intend to pursue and obtain injunctions against Nokia's sales as well as damages (which will include interest from the date of infringement) for Nokia's unlicensed sales after April 9, 2007. While we will continue to work with Nokia to see if we can reach an agreement, there is no guarantee that we will be able to successfully resolve this matter before April 9, 2007 on terms which we find acceptable and little progress has been made to date. If we are unable to reach agreement, and Nokia continues to use our unlicensed intellectual property, we will aggressively pursue all our legal and business options and assume that Nokia will do likewise.

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

@@start.t5@@                                            Business Outlook Summary
                                              (All figures are in US$)
      SECOND FISCAL QUARTER
                                                                                                Current Guidance
                                                                                Q2'06                Q2'07
                                                                            Results          Estimates(1)
      QUALCOMM Pro Forma
      Revenues                                                          $1.83B            $2.0B - $2.1B
      Year-over-year change                                                      increase 9% - 15%
      Diluted earnings per share (EPS)                      $0.41            $0.42 - $0.44
      Year-over-year change                                                        increase 2% - 7%
      Total QUALCOMM (GAAP)
      Revenues                                                          $1.83B            $2.0B - $2.1B
      Year-over-year change                                                      increase 9% - 15%
      Diluted earnings per share (EPS)                      $0.34            $0.35 - $0.37
      Year-over-year change                                                        increase 3% - 9%
      Diluted EPS attributable to QSI                      ($0.01)                      ($0.02)
      Diluted EPS attributable to estimated
        share-based compensation                                ($0.05)                      ($0.05)
      Diluted EPS attributable to
        in-process R&D                                                ($0.01)                          n/a
      Metrics
      MSM Shipments                                        approx. 49M      approx. 55M - 57M
      CDMA/WCDMA handset units shipped         approx. 67M(i) approx. 82M - 86M(i)
      CDMA/WCDMA handset unit wholesale
        average selling price                        approx. $208(i)         approx. $217(i)
      (i)Shipments in Dec. quarter, reported in Mar. quarter
      FISCAL YEAR
                                                                Prior Guidance          Current Guidance
                                        FY 2006                 FY 2007                         FY 2007
                                        Results            Estimates(2)(3)              Estimates(2)
      QUALCOMM Pro Forma
      Revenues                      $7.53B                  $8.1B - $8.6B
      Year-over-year change                        increase 8% - 14%        Reaffirm Prior
      Diluted earnings                                                                         Revenue
        per share (EPS)          $1.64                  $1.72 - $1.77      and EPS Guidance
      Year-over-year change                         increase 5% - 8%
      Total QUALCOMM (GAAP)
      Revenues                      $7.53B                  $8.1B - $8.6B        Reaffirm Prior
      Year-over-year change                        increase 8% - 14%      Revenue Guidance
      Diluted earnings
        per share (EPS)          $1.44                  $1.41 - $1.46          $1.44 - $1.49
      Year-over-year change          decrease 2% - increase 1%  even - increase 3%
      Diluted EPS
        attributable to
        in-process R&D          ($0.01)                                 n/a                          n/a
      Diluted EPS
        attributable to
        QSI                            ($0.02)                            ($0.11)                  ($0.10)
      Diluted EPS
        attributable to
        estimated
        share-based
        compensation              ($0.19)                            ($0.20)                  ($0.20)
      Diluted EPS
        attributable to
        tax items
        related to
        prior years                 $0.02                                  n/a                      $0.02
      Metrics
      Fiscal year(ii)
        CDMA/WCDMA
        handset unit
        wholesale
        average
        selling
        price                approx. $215                    approx. $205            approx. $210
      (ii)Shipments in Sept. to June quarters, reported in Dec. to Sept.
            quarters
      CALENDAR YEAR Handset Estimates
                                                                  Prior Guidance        Current Guidance
                                                                      Calendar 2006          Calendar 2006
      CDMA/WCDMA handset unit shipments              Estimates                 Estimates
      March quarter                                              approx. 66M              approx. 66M
      June quarter                                                approx. 70M              approx. 70M
      September quarter                              approx. 74M - 76M              approx. 76M
      December quarter                                        not provided    approx. 82M - 86M
      Calendar year range (approx.)                    290M - 298M              294M - 298M
                                                                          Midpoint                  Midpoint
      CDMA/WCDMA units                                        approx. 294M            approx. 296M
      CDMA units                                                 approx. 196M            approx. 198M
      WCDMA units                                                 approx. 98M              approx. 98M
                                                                  Prior Guidance        Current Guidance
                                                                      Calendar 2007          Calendar 2007
      CDMA/WCDMA handset unit shipments              Estimates                 Estimates
      March quarter                                            not provided            not provided
      June quarter                                              not provided            not provided
      September quarter                                      not provided            not provided
      December quarter                                        not provided            not provided
      Calendar year range (approx.)                    368M - 388M
                                                                          Midpoint            Reaffirm Prior
      CDMA/WCDMA units                                        approx. 378M          Calendar 2007
      CDMA units                                                 approx. 203M                Guidance
      WCDMA units                                                approx. 175M
      (1) Current Q2'07 estimates incorporate the expected results related to
            acquisitions completed in the first quarter of fiscal 2007.
      (2) FY 2007 estimates do not reflect the potential adverse impact on our
            results, approximately US$0.04 to US$0.06 diluted earnings per share,
            of Nokia not paying royalties in the fourth quarter of fiscal 2007
            for June quarter shipments. Further details are included in the
            introductory paragraph which precedes this Business Outlook table.
      (3) Prior Guidance presented above incorporates the US$0.04 dilution
            estimate for FY 2007 provided on December 3, 2006 related to the
            acquisitions completed in the first quarter of fiscal 2007.@@end@@

    Sums may not equal totals due to rounding.

    Results of Business Segments

    The following tables, which present segment information, have been adjusted to reflect the 2007 segment presentation (Notes 1 and 2) (in millions, except per share data):

@@start.t6@@      First Quarter - Fiscal Year 2007
                                                                                                      Reconciling
      Segments                                QCT(1)      QTL(1)      QWI(2)        Items(1)(2)(3)
      Revenues                              $1,230         $600         $188                  $1
      Change from prior year            19%          14%            5%                 N/M
      Change from prior quarter         7%          (9%)         (4%)                N/M
      EBT                                         $316         $498          $20                $118
      Change from prior year            (7%)          4%          18%                 N/M
      Change from prior quarter        (2%)        (16%)        (23%)                N/M
      Net income (loss)
      Change from prior year
      Change from prior quarter
      Diluted EPS
      Change from prior year
      Change from prior quarter
      Diluted shares used
                                                        Estimated                                          Total
                              QUALCOMM Pro    Share-Based            Tax                    QUALCOMM
      Segments                Forma         Compensation(4)    Items(5)    QSI(6)    (GAAP)
      Revenues                $2,019                 $--                 $--            $--      $2,019
      Change from
        prior year                16%                  --                  --              --          16%
      Change from
        prior quarter            1%                  --                  --              --            1%
      EBT                          $952              $(130)                $--          $(43)        $779
      Change from
        prior year                 5%                 N/M                 N/M            N/M            6%
      Change from
        prior quarter          (1%)                N/M                 N/M            N/M         (4%)
      Net income (loss)    $722                $(86)                $33          $(21)        $648
      Change from
        prior year                 8%                 N/M                 N/M            N/M            5%
      Change from
        prior quarter            2%                 N/M                 N/M            N/M            6%
      Diluted EPS            $0.43            $(0.05)            $0.02        $(0.01)      $0.38
      Change from
        prior year                10%                 N/M                 N/M            N/M            6%
      Change from
        prior quarter            2%                 N/M                 N/M            N/M            6%
      Diluted shares
        used                      1,685              1,685              1,685         1,685        1,685
      Fourth Quarter - Fiscal Year 2006
                                                                                                      Reconciling
      Segments                                QCT(1)      QTL(1)      QWI(2)        Items(1)(2)(3)
      Revenues                              $1,147         $661         $196                 $(5)
      EBT                                          323          591            26                  21
      Net income (loss)
      Diluted EPS
      Diluted shares used
                                              Estimated                                                    Total
                      QUALCOMM Pro  Share-Based         Tax      In-Process          QUALCOMM
      Segments        Forma        Compensation(4) Items(7)      R&D(8)  QSI(6)  (GAAP)
      Revenues      $1,999                 $--              $--            $--         $--    $1,999
      EBT                  961                (127)              --              (1)        (23)        810
      Net income
        (loss)            705                 (76)            (16)            (1)          2         614
      Diluted EPS  $0.42            $(0.05)        $(0.01)          $--         $--      $0.36
      Diluted
        shares
        used            1,693              1,693          1,693         1,693      1,693      1,693
      First Quarter - Fiscal Year 2006
                                                                                                      Reconciling
      Segments                                QCT(1)      QTL(1)      QWI(2)        Items(1)(2)(3)
      Revenues                              $1,033         $526         $179                  $3
      EBT                                          338          479            17                  72
      Net income (loss)
      Diluted EPS
      Diluted shares used
                                                        Estimated                                          Total
                              QUALCOMM Pro    Share-Based            Tax                    QUALCOMM
      Segments                Forma         Compensation(4)    Items(9)    QSI(6)    (GAAP)
      Revenues                $1,741                 $--                 $--            $--      $1,741
      EBT                            906                (122)                 --            (48)         736
      Net income
        (loss)                      667                 (82)                 56            (21)         620
      Diluted EPS            $0.39            $(0.05)            $0.03        $(0.01)      $0.36
      Diluted
        shares
        used                      1,702              1,702              1,702         1,702        1,702
      Second Quarter - Fiscal Year 2006
                                                                                                      Reconciling
      Segments                                QCT(1)      QTL(1)      QWI(2)        Items(1)(2)(3)
      Revenues                              $1,018         $640         $178                 $(2)
      EBT                                          291          587            16                  68
      Net income (loss)
      Diluted EPS
      Diluted shares used
                                                        Estimated                                          Total
                              QUALCOMM Pro    Share-Based      In-Process                QUALCOMM
      Segments                Forma         Compensation(4)      R&D(8)      QSI(6)    (GAAP)
      Revenues              $1,834                  $--                 $--            $--      $1,834
      EBT                          962                 (120)                (21)          (36)         785
      Net income
        (loss)                    706                  (78)                (21)          (14)         593
      Diluted EPS          $0.41              $(0.05)          $(0.01)      $(0.01)      $0.34
      Diluted
        shares
        used                    1,721                1,721              1,721         1,721        1,721
      Twelve Months - Fiscal Year 2006
                                                                                                      Reconciling
      Segments                                QCT(1)      QTL(1)      QWI(2)        Items(1)(2)(3)
      Revenues                              $4,332      $2,467         $731                 $(4)
      EBT                                      $1,298      $2,233          $78                $197
      Net income (loss)
      Diluted EPS
      Diluted shares used
                                              Estimated                                                    Total
                      QUALCOMM Pro  Share-Based    Tax Items  In-Process         QUALCOMM
      Segments        Forma        Compensation(4)  (7)(9)        R&D(8)      QSI    (GAAP)
      Revenues        $7,526                $--              $--            $--         $--    $7,526
      EBT                $3,806            $(495)            $--          $(22)    $(133)  $3,156
      Net income
        (loss)         $2,804            $(320)            $40          $(22)      $(32)  $2,470
      Diluted EPS    $1.64          $(0.19)         $0.02        $(0.01)  $(0.02)    $1.44
      Diluted
        shares
        used              1,711            1,711          1,711         1,711      1,711      1,711
      (1) During the first quarter of fiscal 2007, the Company reassessed the
            intersegment royalty charged to QCT by QTL and determined that the
            royalty should be eliminated starting in fiscal 2007 for management
            reporting purposes to, among other reasons, recognize other value
            that QTL has increasingly been realizing from QCT. As a result, QCT
            did not record a royalty to QTL in the first quarter of fiscal 2007,
            and prior period segment information has been adjusted in the same
            manner for comparative purposes.
      (2) During the first quarter of fiscal 2007, the Company reorganized the
            QUALCOMM Wireless Systems (QWS) division, which sells products and
            services to Globalstar, into the QWBS division in the QWI segment.
            Revenues and operating results relating to the QWS business were
            included in reconciling items through the end of fiscal 2006. Prior
            period segment information has been adjusted to conform to the new
            segment presentation.
      (3) Reconciling items related to revenues consist primarily of other
            nonreportable segment revenues less intersegment eliminations.
            Reconciling items related to earnings before taxes consist primarily
            of certain investment income, research and development expenses and
            marketing expenses that are not allocated to the segments for
            management reporting purposes, nonreportable segment results and the
            elimination of intercompany profit.
      (4) Certain share-based compensation is included in operating expenses
            as part of employee-related costs but is not allocated to our
            segments as such costs are not considered relevant by management in
            evaluating segment performance. Estimated share-based compensation,
            presented above and excluded from pro forma results, does not include
            US$1 million, net of tax, related to share-based awards granted under
            the executive bonus program.
      (5) During the first quarter of fiscal 2007, the federal R&D tax credit
            that expired on December 31, 2005 was extended by Congress for a
            period of two years beyond the prior expiration date. We recorded
            a tax benefit of US$33 million, or US$0.02 diluted earnings per
            share, related to fiscal 2006 in the first quarter of fiscal 2007 due
            to this retroactive extension. The effective tax rate for the first
            quarter of fiscal 2007 for total QUALCOMM (GAAP) was 17% primarily as
            a result of this benefit. Our first quarter fiscal 2007 QUALCOMM pro
            forma results exclude this tax benefit attributable to 2006.
      (6) At fiscal year-end, the sum of the quarterly tax provisions for each
            column, including QSI, equals 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).
      (7) During the fourth quarter of fiscal 2006, the Company refined its
            estimate of R&D costs allocable to the Company's foreign operations
            to reflect actual results and updated its forecast of future benefits
            under an intercompany cost sharing agreement. Due to this
            adjustment, the effective tax rate in the fourth quarter of fiscal
            2006 for total QUALCOMM (GAAP) includes US$33 million of tax expense,
            or US$0.02 per diluted share, related to fiscal 2004. In addition,
            the Company recorded a US$17 million tax benefit, or US$0.01 diluted
            earnings per share, related to the impact of prior year tax audits
            completed during the fourth quarter of fiscal 2006. For fiscal 2006
            pro forma presentation, results were adjusted to exclude these tax
            adjustments related to prior years.
      (8) During fiscal 2006, the Company recorded US$22 million of expenses
            related to acquired in-process R&D associated with three
            acquisitions completed during the year. US$21 million of this expense
            was recorded in the second quarter of fiscal 2006 and US$1 million
            was recorded in the fourth quarter of fiscal 2006. For fiscal 2006
            pro forma presentation, results were adjusted to exclude these
            expenses.
      (9) During the first quarter of fiscal 2006, the Company recorded a
            US$56 million tax benefit, or US$0.03 diluted earnings per share,
            related to the expected impact of prior year tax audits completed
            during that quarter. For fiscal 2006 pro forma presentation, results
            were adjusted to exclude this tax adjustment attributable to prior
            years.@@end@@

    N/M - Not Meaningful

    Sums may not equal totals due to rounding.

    Conference Call

    QUALCOMM's first quarter fiscal 2007 earnings conference call will be broadcast live on January 24, 2007 beginning at 1:45 p.m. Pacific Standard Time (PST) 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 January 24, 2007 beginning at approximately 5:30 p.m. (PST) through February 7, 2007 at 9:00 p.m. (PST). 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 4455735. 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.

    Editor's Note: If you would like to view the web slides that accompany this earnings release and conference call, please view the QUALCOMM Investor Relations website at http://investor.qualcomm.com/results.cfm .

    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. 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.

    Pro forma information used by management excludes the QUALCOMM Strategic Initiatives (QSI) segment, certain estimated share-based compensation, certain tax adjustments 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, other than amounts related to share-based awards granted under the executive bonus program, 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 adjustments 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.

    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 cash flow 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; attacks on our licensing business model, including results of current and future litigation as well as actions of governmental or quasi-governmental bodies, and the costs we incur in connection therewith; 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; the development, deployment and commercial acceptance of the MediaFLO USA network and FLO(TM) technology; as well as the other risks detailed from time-to-time in the Company's SEC reports.

    (C) 2007 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.

@@start.t7@@      QUALCOMM Contact:
      John Gilbert
      Vice President of Investor and Industry Analyst Relations
      +1(858)658-4813 (ph) +1(858)651-9303 (fax)
      e-mail: ir@qualcomm.com
                                                QUALCOMM Incorporated
                                  CONSOLIDATED STATEMENTS OF OPERATIONS
                  THIS SCHEDULE IS TO ASSIST THE READER IN RECONCILING FROM
                              PRO FORMA RESULTS TO TOTAL QUALCOMM RESULTS
                                  (In millions US, except per share data)
                                                        (Unaudited)
                                                 Three Months Ended December 31, 2006
                                                      Estimated                                        Total
                                  QUALCOMM    Share-Based                                    QUALCOMM
                                 Pro Forma  Compensation(a)  Tax Items    QSI      (GAAP)
      Revenues:
         Equipment and
          services            $1,342              $--                  $--        $--      $1,342
         Licensing and
          royalty fees          677                --                    --         --          677
            Total
              revenues          2,019                --                    --         --        2,019
      Operating expenses:
         Cost of
          equipment
          and services
          revenues                 624                10                    --         --          634
         Research and
          development            365                58                    --         17          440
         Selling,
          general and
          administrative        282                62                    --         25          369
            Total
              operating
              expenses          1,271              130                    --         42        1,443
      Operating income
        (loss)                        748            (130)                  --        (42)         576
      Investment
        income, net                204(b)          --                    --         (1)(c)    203
      Income (loss)
        before income
        taxes                         952            (130)                  --        (43)         779
      Income tax
        (expense)
        benefit                    (230)(d)         44                    33         22(e)  (131)(d)
      Net income
        (loss)                      $722            $(86)                 $33      $(21)        $648
      Earnings (loss)
        per common share:
         Diluted                 $0.43         $(0.05)              $0.02  $(0.01)      $0.38
      Shares used in
        per share
        calculations:
         Diluted                 1,685          1,685                1,685    1,685        1,685
      Supplemental
        Financial Data:
      Operating Cash Flow  $834            $(32)(g)            $--      $(13)        $789
      Operating Cash Flow
        as a % of Revenues      41%                                                                  39%
      Free Cash Flow (f)    $544            $(32)(g)            $--      $(45)        $467
      Free Cash Flow
        as a % of Revenues      27%                                                                  23%
      (a) Estimated share-based compensation presented above and excluded
            from pro forma results does not include US$1 million, net of tax,
            related to share-based awards granted under the executive bonus
            program.
      (b) Includes US$142 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$63 million in net realized gains on investments, partially offset
            by US$1 million in interest expense.
      (c) Includes US$1 million in losses on derivatives, US$1 million in
            interest expense and US$1 million in other-than-temporary losses on
            investments, partially offset by US$1 million in net realized gains
            on investments and US$1 million in interest and dividend income.
      (d) The first quarter of fiscal 2007 tax rates are approximately 17% for
            total QUALCOMM (GAAP) and approximately 24% for QUALCOMM pro forma.
      (e) 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).
      (f) Free Cash Flow is calculated as net cash provided by operating
            activities less capital expenditures.  Reconciliation of these
            amounts is included in the Reconciliation of Pro Forma Free Cash
            Flows to Net Cash Provided by Operating Activities for Total
            QUALCOMM for the three months ended December 31, 2006, included
            herein.
      (g) Tax benefits from stock options exercised during the quarter.
                                            QUALCOMM Incorporated
                         RECONCILIATION OF PRO FORMA FREE CASH FLOWS TO
            TOTAL QUALCOMM (GAAP) NET CASH PROVIDED BY OPERATING ACTIVITIES
                                  AND OTHER SUPPLEMENTAL DISCLOSURES
                                                  (In millions)
                                                    (Unaudited)
                                                      Three Months Ended December 31, 2006
                                                                    Estimated                            Total
                                                QUALCOMM      Share-Based                         QUALCOMM
                                              Pro Forma      Compensation         QSI          (GAAP)
      Net cash provided (used)
        by operating activities      $834              $(32)(a)         $(13)          $789
      Less: capital expenditures  (290)                --                 (32)          (322)
      Free cash flow                      $544              $(32)              $(45)          $467
      Other supplemental
        cash disclosures:
         Cash transfers from
          QSI(1)                                 $7                $--                 $(7)            $--
         Cash transfers to
          QSI(2)                                (95)                --                  95                --
         Net cash transfers
          from (to)/from QSI          $(88)              $--                 $88              $--
      (1) Cash from loan payments and sale of equity securities.
      (2) Funding for strategic debt and equity investments and other QSI
            operating expenses.
                                                      Three Months Ended December 25, 2005
                                                                    Estimated                            Total
                                                QUALCOMM      Share-Based                         QUALCOMM
                                              Pro Forma      Compensation         QSI          (GAAP)
      Net cash provided (used)
        by operating activities      $713            $(101)(a)         $(16)          $596
      Less: capital
        expenditures                        (182)                --                 (31)          (213)
      Free cash flow                      $531            $(101)              $(47)          $383
      (a) Tax benefits from stock options exercised during the period.
                                            QUALCOMM Incorporated
                                CONDENSED CONSOLIDATED BALANCE SHEETS
                                  (In millions, except per share data)
                                                    (Unaudited)
                                                            ASSETS
                                                                              December 31,    September 24,
                                                                                      2006                 2006
      Current assets:
         Cash and cash equivalents                                    $2,649              $1,607
         Marketable securities                                            3,298                4,114
         Accounts receivable, net                                          693                  700
         Inventories                                                                330                  250
         Deferred tax assets                                                  229                  235
         Other current assets                                                 180                  143
            Total current assets                                          7,379                7,049
      Marketable securities                                                4,598                4,228
      Property, plant and equipment, net                          1,559                1,482
      Goodwill                                                                    1,320                1,230
      Deferred tax assets                                                      441                  512
      Other assets                                                              1,041                  707
            Total assets                                                    $16,338            $15,208
                                    LIABILITIES AND STOCKHOLDERS' EQUITY
      Current liabilities:
         Trade accounts payable                                            $471                 $420
         Payroll and other benefits related liabilities        205                  273
         Dividend payable                                                        198                    --
         Unearned revenue                                                        253                  197
         Other current liabilities                                         631                  532
            Total current liabilities                                  1,758                1,422
      Unearned revenue                                                          144                  141
      Other liabilities                                                         261                  239
            Total liabilities                                                2,163                1,802
      Stockholders' equity:
         Preferred stock, $0.0001 par value;
          issuable in series; 8 shares authorized;
          none outstanding at December 31, 2006 and
          September 24, 2006                                                    --                    --
         Common stock, $0.0001 par value;
          6,000 shares authorized;
          1,655 and 1,652 shares issued and outstanding
          at December 31, 2006 and September 24, 2006,
          respectively                                                              --                    --
         Paid-in capital                                                      7,427                7,242
         Retained earnings                                                  6,549                6,100
         Accumulated other comprehensive income                    199                    64
            Total stockholders' equity                                14,175              13,406
            Total liabilities and stockholders' equity    $16,338            $15,208
                                            QUALCOMM Incorporated
                        CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (In millions, except per share data)
                                                    (Unaudited)
                                                                                      Three Months Ended
                                                                                December 31,    December 25,
                                                                                      2006                 2005
      Revenues:
         Equipment and services                                         $1,342              $1,150
         Licensing and royalty fees                                        677                  591
            Total revenues                                                    2,019                1,741
      Operating expenses:
         Cost of equipment and services revenues                  634                  517
         Research and development                                          440                  340
         Selling, general and administrative                         369                  239
            Total operating expenses                                    1,443                1,096
      Operating income                                                          576                  645
      Investment income, net                                                 203                    91
      Income before income taxes                                          779                  736
      Income tax expense                                                      (131)                (116)
      Net income                                                                  $648                 $620
      Basic earnings per common share                                $0.39                $0.38
      Diluted earnings per common share                            $0.38                $0.36
      Shares used in per share calculations:
         Basic                                                                      1,653                1,645
         Diluted                                                                  1,685                1,702
      Dividends per share paid                                              $--                  $--
      Dividends per share announced                                  $0.12                $0.09
                                            QUALCOMM Incorporated
                        CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                  (In millions)
                                                    (Unaudited)
                                                                                      Three Months Ended
                                                                                December 31,    December 25,
                                                                                      2006                 2005
      Operating Activities:
      Net income                                                                  $648                 $620
      Adjustments to reconcile net income to
        net cash provided by operating activities:
         Depreciation and amortization                                    91                    58
         Non-cash portion of share-based
          compensation expense                                                130                  122
         Incremental tax benefits from
          stock options exercised                                          (32)                (101)
         Net realized gains on marketable securities
          and other investments                                              (64)                 (20)
         Equity in losses of investees                                    --                    20
         Non-cash income tax expense                                        54                  104
         Other items, net                                                          5                  (16)
      Changes in assets and liabilities,
        net of effects of acquisitions:
         Accounts receivable, net                                            (9)                (171)
         Inventories                                                                (81)                 (18)
         Other assets                                                              (98)                  16
         Trade accounts payable                                                47                    87
         Payroll, benefits and other liabilities                    38                  (86)
         Unearned revenue                                                         60                  (19)
         Net cash provided by operating activities                789                  596
      Investing Activities:
         Capital expenditures                                                (322)                (213)
         Purchases of available-for-sale securities         (1,673)            (3,318)
         Proceeds from sale of available-for-sale
          securities                                                            2,436                2,160
         Other investments and acquisitions,
          net of cash acquired                                              (220)                  (6)
         Other items, net                                                         (2)                    4
         Net cash provided (used) by investing activities    219              (1,373)
      Financing Activities:
         Proceeds from issuance of common stock                      97                  181
         Repurchase and retirement of common stock                (96)                  --
         Incremental tax benefits from stock options
          exercised                                                                  32                  101
         Net cash provided by financing activities                 33                  282
         Effect of exchange rate changes on cash                      1                      2
      Net increase (decrease) in cash and
        cash equivalents                                                      1,042                 (493)
      Cash and cash equivalents at beginning of period    1,607                2,070
      Cash and cash equivalents at end of period            $2,649              $1,577@@end@@

    Web site: http://www.qualcomm.com

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

Contact:
John Gilbert, Vice President of Investor and Industry Analyst
Relations of QUALCOMM Incorporated, +1-858-658-4813, or fax,
+1-858-651-9303, ir@qualcomm.com



Weitere Meldungen: Qualcomm Incorporated

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