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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: cfoe who wrote (47871)	11/4/1999 8:47:00 PM
From: Bux	Respond to of 152472

On the cc, management said that ASIC sales where heavier in the qtr. ending Sept because of the lead time for phone makers to get ready for the Oct-Dec sales period. However, royalties for phone sales should be much higher in this quarter than in the Jul-Sep quarter. Is my thinking here correct? That sounds right to me. In addition, I am figuring the parts shortage that hindered phone production in the most recent quarter will be improved or eliminated in the next quarter. I think these two factors combined could lead to a dramatic improvement in royalties and could improve the handset division numbers until it is sold. Bux

To: cfoe who wrote (47871)	11/5/1999 9:18:00 AM
From: slacker711	Respond to of 152472

About Q1/00 earnings. On the cc, management said that ASIC sales where heavier in the qtr. ending Sept because of the lead time for phone makers to get ready for the Oct-Dec sales period. However, royalties for phone sales should be much higher in this quarter than in the Jul-Sep quarter. Is my thinking here correct? Before we start predicting 200m in royalties (or some equally huge number)......I think that we need to look at how royalties track CDMA growth. The last three quarters have had 9m, 11m, and 14m ASIC shipments. The royalties reported were 77m, 86m, and 113m. Those numbers track almost linearly. It really seems like Qualcomm recognises royalties at the time of ASIC shipment. Also, last year Qualcomm reported sequentially lower royalties during the Christmas quarter versus the third quarter of '98. The actual calculations are more complex since you need to figure out how much of the royalties are due to licensee versus handset sales. Also the ASIC shipments need to exclude use by Q's own handset division....however I think the general trend is relatively clear. I think a slight gain on $113m is probably expected....not too much more. Slacker