SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : The New Qualcomm - a S&P500 company
QCOM 174.810.0%Dec 26 9:30 AM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Ron M who wrote (4479)12/23/1999 8:28:00 AM
From: w molloy  Read Replies (1) of 13582
 
Between the lines...

As part of the deal, Kyocera agreed to purchase a majority
of its code division multiple access chip sets from
Qualcomm for five years.

This is fluff. KYO already purchases the majority
of its chips from QCOM. There will be no change in the numbers.

Financial terms of the sale were not disclosed.

Neither were the ERICY terms. Given that the division was a dog, and that KYO will wind down the manufacturing side (they will build the 'phones in Malaysia, Taiwan and China) you can bet that they will not have parted with as much cash as some would like us to believe.

There are 4,000 workers in the consumer products
division, and Kyocera officials said they have not decided
how many will keep their jobs. Qualcomm officials said
some of those employees will stay on to design phones, but
the exact number was unknown.

Anybody associated with manufacturing (the majority) will be out.
The QCP engineers will remain, nominally part of QCOM, for 3 years.
The 'contract out' deal means that QCOM craftily sidestep the option issue that soured the ERICY deal.

The production of mobile phone handsets had become a
barely profitable business in recent years because of parts
shortages and intense competition from industry leaders
such as Nokia and U.S.-based Motorola. Qualcomm's
margin of profit in the division had shrunk to 2 percent.

This is misleading. The division was a 'loss-leader' for CDMA. It only recently got into the black. QCOM were plagued more by manufacturing and QA difficulties than by component shortages.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News