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Technology Stocks : Qualcomm Moderated Thread - please read rules before posting

QCOM 165.77

+1.5%

3:02 PM EST

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To: slacker711 who wrote (40700)	5/12/2004 9:18:29 AM
From: Jim Mullens	Read Replies (1) of 196744

Slacker, Re: Q’s 2005 guidance and “I always like getting information, but I wonder why they are changing their normal timing for guidance? This has to be a pretty conservative target or it makes zero sense to give guidance when you dont have much direct visibility into '05.” Why? 1. CSM shipments for 2004 have been running over 2X the average for the past several years. CSM shipments in large part are a precursor to network expansion to support subscriber growth. 2. With WCDMA beginning its ramp, CDMA handset ASPs are rising- 2004 guidance increased to $195 from $194 ($179 original 2004 guidance). 3. MSM demand continues to outstrip supply. 4. So far, 21 handset manufactures have signed up to use the Q chipsets for WCDMA handsets. There must be a pent-up demand for feature rich devices in Europe where they have been promised such for 3 years (since 2001). 5. The World Phone (MSM6300) is about to be sold by China Unicom, finally tapping the GSM upgrade market of some 70 million subs. 6. To support its loyal long-term investors by providing “official” Q blessed numbers (2005 handset sales estimates) to the generally clueless “analyst” community from which they can base reasonable 2005 EPS estimates upon. ..........Consensus Est......CDMA Handset Sales ..........EPS-fy..................Q’s rev guidance- cy. 2002 $0.98 2003 $1.42 2004 $2.01....................156 2005 $2.14...+6%..........205...31% 2005 $2.63 @ 31% increase to 2004 est, and over 35% CAGR since 2002 (3 years) With the initial Sept qtr MSM guidance at 32 – 36 M (below Q3 of 34- 35), there is still room for more positive surprises. With MSM demand continuing to not meet supply, and the stated objective to build a “cushion”, it should not be a surprise if Q4 MSM shipment exceed 40M units. Note- The “analyst” community continues to reflect a consensus LT growth rate of 15% for the Q, roughly the same as the Communications Equipment industry in general, and slightly above the Technology sector. Perhaps now seeing the Q’s bullish 2005 handset guidance (no doubt still conservative- under promise/ over deliver) , they will now reconsider their unrealistically low LT Growth estimates and bump them up also. Sorry Cooters- thou you may still have your opportunity given this uncooperative market.

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