From Briefing.com
12:15 ET ******
QUALCOMM INC. (QCOM) 47 7/8 +1/8. Shares of wireless communications equipment concern are trading tentatively higher today as the company said the South Korean sales impact is not viewed to be as bad as had been originally suspected. Following a visit to China, the company's CEO Irwin Jacobs commented on activities in Korea, noting that instead of order cancellations, it is receiving order delays, which are likely to be delivered in future quarters. In early February, Qualcomm said that because two Korean manufacturers had requested partial cancellation or postponement of their major orders, the company would not meet Q2 earnings expectations. At the time, Qualcomm was projected to earn $0.50 a share, compared with year-ago net of $0.23 a share on revenues of $585.7 million. Since then, however, earnings expectations have been scaled back to $0.24 a share, more than 50% below what it earned in the preceding quarter when revenues topped the $785.85 million mark. Today's comment that the situation in Korea may not be as bad as had originally been suspected has had little impact on the stock. This is partly because the company also announced that its code division multiple access or CDMA format that was expected to be launched in Japan in April has been pushed back until July. No fault of their own of course, just that the Japanese government wished to assure a certain degree of subscribers before the format was launched.
On the positive side, the company is trying to set-up manufacturing facilities in China in order to develop the market for digital wireless phone systems in the region. So far, the government has yet to give the okay on QCOM's plans, but some type of authorization is expected before the end of the year. The recent bout of bad news has left the stock trading well below its high of $71 15/16 reached late last year before the problems in Asia became so evident. |
