Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: slacker711 who wrote (32312)	2/13/2003 11:28:48 AM
From: Jim Mullens	Read Replies (2) \| Respond to of 196559

Ron / Slacker– Re “What does the accrual (plus estimate) of royalties have to do with the handset estimate?” This was my original thinking based on a misunderstanding of Slacker’s post. - The royalties are less for CDMA handsets that include a Qualcomm chipset than they are for those that don’t include a Qualcomm chipset. Therefore, with a higher chipset market share in the December quarter, one would expect the QTL EBT$/ MSM to be lower. Re: “Additionally, you have been presenting the ratio of QTL Earnings Before Taxes ("EBT") to QCT chipset shipments. But that is not appropriate in an environment of rapidly increasing chipset shipments because .. we don't know the time lag between MSMxxxx chipset shipments and handset shipments.” Exactly, this metric is showing me that because of the lag in royalty revenue recognition, the subsequent quarter(s) revenue and EBT will be higher due to the delay in reporting against actual MSMs shipped and the fact that there is a lead time of approximately one quarter of MSM shipments to handset sales. With the significant increase in MSM shipments between the Sept and Dec quarters (20M vs 29M- 45%), this tells me that we should see a significant increase in handset sales and QTL revenue / EBT in the March quarter even with MSM chipsets declining from 29M in Dec to the 27M estimate for March. Thanks Slacker for your reply correcting my misinterpretation of you prior post and the handset sales units going back to ’99. This is very helpful. When I get the time I will do a spreadsheet with handset sales, MSM shipments and QTL revenue and EBT by quarter and offset the MSM shipments by a quarter to adjust for the lead time and see what relationships that presents. Up until the last two quarters the MSM shipments have consistently fluctuated between 11 and 16 million per quarter. In September the ramp began with 20 million and accelerated to 29 million in December. I will also include in the spreadsheet QTL EBT$ per handset sales which is the more appropriate metric as Ron suggests. In the past it has been difficult to get quarterly handset sales figures, hopefully Qualcomm will be able to provide them going forward. The relationships between MSMs shipped, handset sales, and the various revenue figures can get distorted when abrupt changes occur. p.s. I’m coming up with these figures for Fy 02 and Q1FY03 (dec) Help …………Handset sales…..QTL Revenue…QTL EBT…..Rev/ handset……EBT/handset FY02…..80M………………$847M…………$756M…………$10.58…………$9.45 1Q03….26M……………….$255M…….…..$229M………….$ 9.80…………$8.80 Thanks- Jim

To: slacker711 who wrote (32312)	2/13/2003 11:30:57 AM
From: rkral	Read Replies (1) \| Respond to of 196559

slacker711, re "I think the denominator that you need to use for the first number is 80 million units. This is the (approximate) number of handsets that were shipped during FY02." Thanks for the correction. Knew I had a Delicious/Jonathon apples comparison, but would never have guessed handset shipments were greater than MSM shipments in FY '02. Indeed, I'm still skeptical. Please provide the source of your numbers in #reply-18274267. In particular, do you still have a link for the graph to which you refer? TIA, Ron