DJ Qualcomm Oper Chief Sees 15%-20% Annual Growth For 2 Cos
Dow Jones News Service ~ March 22, 2001 ~ 8:16 am EST
By Christine Nuzum
Of DOW JONES NEWSWIRES
(This story originally ran late Wednesday.)
LAS VEGAS (Dow Jones)--It will be another couple of years before third- generation wireless service using Qualcomm Inc.'s (QCOM) patented technology is launched in Europe, Chief Operating Officer Richard Sulpizio said Wednesday.
Sulpizio estimates that wideband code division multiple access, or WCDMA, technology won't appear in Europe until 2003 or 2004, he told Dow Jones Newswires in an interview late Wednesday. Qualcomm, which collects royalties on patents for WCDMA and CDMA phones, recommends the latter standard as more cost- efficient, Sulpizio said.
Qualcomm's long-awaited sales of chipsets for use in China may be under way as soon as this summer, Sulpizio predicts. He thinks China Unicom will request quotations for CDMA, or code division multiple access, handsets and bay stations in 30 to 45 days. Negotiations could take an additional three to four months, he said.
"You could see in June orders being given, with equipment being shipped in the summer," Sulpizio said.
Qualcomm collects revenue from both semiconductor sales and patent royalties for CDMA products. Those two revenue streams will be separated later this year, when Qualcomm spins off its semiconductor business to shareholders.
Sulpizio will be chief executive of the new company.
Qualcomm had filed for a November 2000 IPO for its semiconductor business, but the fall the stock took on Nasdaq put an end to those plans.
"We see no reason to sell stock that we consider to be undervalued," Sulpizio told Dow Jones Newswires Wednesday evening.
Instead, Qualcomm will spin off the business all at once to shareholders by October. To avoid being required to refile to spin off the business, Qualcomm must complete the transaction within a year of the originally slated IPO date. Lehman Brothers and Goldman Sachs are advising Qualcomm in the spinoff. Sulpizio said that market conditions won't have an impact on the spinoff.
Last year, Qualcomm's semiconductor business brought in about $1.2 billion of the company's total revenue of $2.8 to $2.9 billion, Sulpizio said. The two companies will have roughly parallel growth, which he estimates will soon level off to roughly 15% to 20% a year.
Qualcomm will retain the bulk of its intellectual property, but will give the new company a percentage of patents in every category, he said. In addition to patents, Qualcomm will purvey Binary Runtime Environment for Wireless, or BREW, a platform for developing wireless programs.
-Christine Nuzum, Dow Jones Newswires; 201-938-5172
(END) DOW JONES NEWS 03-22-01
08:16 AM |
