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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 170.90-1.3%Nov 7 9:30 AM EST

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To: DaveMG who wrote (25480)3/29/1999 9:29:00 AM
From: Clarksterh  Read Replies (2) of 152472
 
Daves - Inre royalties contribution to the bottom line:

While it is true that the royalties are about equal to the net profit, it is not true that without royalties we would have had no net profit. First, there are taxes which take a bite out of royalties. Second some of the operating costs should be 'assigned' to the operating costs. For instance, R&D is an indirect cost of future royalty streams and of course IP has to be sold and administered just as does real property. Certainly the accounting is interesting, but I would say that royalties contribute 1/7 of the gross profit and maybe 1/4(?) of the current bottom line.

Clark
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