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

To: 16yearcycle who wrote (122301)	7/26/2002 11:24:49 AM
From: H James Morris	Respond to of 152472

July 26, 2002 Qualcomm reported a $14 million net loss for its third quarter yesterday, but surpassed analysts' estimates and raised its earnings forecast for the rest of year, saying it experienced increased demand for its next-generation wireless technology. Qualcomm's 2-cents-a-share loss was thanks largely to the company's $194 million charge against its investment in Leap, a San Diego wireless carrier. Leap, which was spun off from Qualcomm in 1998, has seen its stock price fall about 90 percent since the beginning of the year. In the same quarter a year ago, Qualcomm recorded a net loss of $193.5 million, or 26 cents a share, as it wrote down its investment in Vesper, a Brazilian wireless company. Excluding investments in wireless carriers and other costs, Qualcomm reported pro forma net income of $193.6 million, or 24 cents a share, compared with $158.4 million, or 20 cents, a year earlier. Based on those pro forma results, Qualcomm beat the forecast of 22 cents a share made by financial analysts polled by Thomson Financial/First Call. Investors reacted positively to Qualcomm's earnings report, pushing the company's stock up as much as $2.07 in after-hours trading to $27.72. Shares in Qualcomm had fallen $3.45, or about 12 percent, during regular trading after one analyst downgraded the stock. William E. Keitel, Qualcomm's chief financial officer, said he thought it was odd that UBS Warburg analyst Jeffrey Schlesinger downgraded the company to "hold" from "buy" before the earnings announcement. "It confounds me a little bit," he said. Despite that downgrade, Qualcomm executives said the future looks bright. The company raised its earnings forecast for the rest of its fiscal year, which ends in September. The company estimated that fourth-quarter pro forma revenue would increase by 10 percent to 13 percent from the third quarter, with pro forma earnings of 26 to 27 cents per share. That compares with the average analyst estimate of 24 cents a share, according to First Call. Qualcomm executives attributed the company's results to the growing demand for third-generation, or 3G, wireless Internet services in such countries as South Korea and Japan. The company expects to gain further momentum as Sprint PCS launches its nationwide next-generation cell phone service. Verizon has already begun rolling out a similar service using Qualcomm's technology in select markets. Analysts were impressed that Qualcomm was able to deliver strong results during such tough economic times in the wireless industry. "Most people on the Street were looking for a good June quarter," said Matthew Hoffman, an analyst with SoundView Technology. "They provided it."