Qualcomm Incorporated (QCOM) Message Board

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Technology Stocks : Qualcomm Incorporated (QCOM)

QCOM 172.29

-2.2%

Dec 17 3:59 PM EST

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To: dougjn who wrote (6272)	12/12/1997 1:37:00 PM
From: Michael Allard	Read Replies (1) of 152472

Certainly discouraging. The downgrade, which blamed lower Korean Royalties, lowered their 1998 earnings estimate from $2.30 to 2.06. That's an 11% decrease. The stock is now down 28% this week. I don't know, you think maybe there has been an over reaction? I curently believe that the Koreans will have a small impact on QCOM's earnings, which I expect to be above the street estimates. The Korean infastructure was built out over the last 2 years, and has been mostly paid for. QCOM has already recieved most of the Royalty associated with the harware. In 1998, most of the revenue in Korea will come from royalties on phones that they manufacture and sell either into our out of the Korean market. Every phone will use an ASIC that QCOM sells to the Korean manufacturer. That price isn't going to go down, though it will cost the Koreans more. There is still a large undersupply of CDMA habdsets in the world, and if the Koreans don't manufacture, someone else well.

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