From the San Diego Union Tribune;
Qualcomm 3rd-quarter profit
surges fivefold, beating
expectations
BLOOMBERG NEWS SERVICE
July 19, 1999
SAN DIEGO -- Qualcomm Inc., which developed the
world's second-most popular mobile-phone technology,
said Monday fiscal third-quarter profit surged more than
fivefold on strong demand for mobile phones and the chips
that run them.
"We achieved several important milestones this quarter,
including closing the sale of the terrestrial CDMA wireless
infrastructure business, attaining the No. 2 position in
digital phone market share in the U.S., and shipping over
11 million MSM chips to CDMA phone manufacturers
worldwide," said Dr. Irwin Mark Jacobs, chairman and
CEO of Qualcomm. "We are also pleased to have been
selected for inclusion in the S&P 500 index."
Profit from operations in the quarter ended June 27 rose to
$134.9 million, or 75 cents a share, from $24.7 million, or
17 cents, a year earlier. That beat the 63-cent average
estimate of analysts polled by First Call Corp. Estimates
ranged from 56 cents to 68 cents.
Sales rose 15 percent to $1 billion from $875.5 million.
Qualcomm said the growth came from demand for cell
phones and semiconductors for cell phones, as well as
royalties from other companies that use its technology.
Qualcomm shares, which have climbed more than sixfold
so far this year, rose 7/16 to 158 11/16.
The stock has been gaining since March, when the company
settled a patent dispute with No. 3 cellular-phone maker
Ericsson AB, which also agreed to buy Qualcomm's
money-losing cellular-network equipment business.
Qualcomm said it shipped 1.7 million phones during the
quarter and 11 million chips. Phone sales were hurt
somewhat by parts shortages, which could also limit
fourth-quarter results, the company said.
Royalty payments almost doubled to $93 million from $47
million a year ago.
The higher earnings are expected to boost the company's
tax rate to 35 percent in the year ending Sept. 30, from 30
percent in fiscal 1998.
After a pretax charge of $117 million, or 40 cents a share,
for the network unit sales, Qualcomm had net income of
$58.9 million, or 35 cents. A year earlier, net income was
$6 million, or 8 cents a share, including charges to write
down the value of some investments. |
