Qualcomm: another bang-up quarter despite legal overhangs

A “focus on execution” has allowed Qualcomm Inc. to continue performing well, even while searching for a resolution to its stand-off with Nokia Corp. and defending its business model in patent disputes, the company announced.
The San Diego-based chip and intellectual property-licensing firm posted $2.44 billion in revenue for the fiscal first quarter, up 21% year-over-year, while net income rose to $767 million, up 18% year-over-year.
“Our continued focus on execution allows us to deliver excellent financial results despite the impact of defending our business model,” said CEO Paul Jacobs in a statement accompanying Qualcomm’s earnings, which were delivered after the stock market closed.
Qualcomm continued to have “periodic discussions” with Nokia Corp. on reaching a new cross-licensing agreement, after the last such agreement expired in April, according to President Steve Altman. But the two parties have made “no significant progress” in resolving that standoff, despite the appointment of an arbitration panel. Qualcomm is awaiting word on whether it will be allowed to combine the arbitration process with a court case getting underway in Delaware, Altman said. Meanwhile, Qualcomm said it isn’t recording any anticipated licensing revenue from Nokia.
In its various patent disputes with rival chipmaker Broadcom Corp., Qualcomm is complying with court decisions while it develops work-around solutions that could serve its customers, the company said. (Qualcomm reiterated that it expected devices containing various work-arounds to reach consumers in the current quarter.) Meantime, Qualcomm continued to pursue appeals and clarifications of decisions at the U.S. International Trade Commission and before a federal court in Santa Ana, Calif., both of which found that Qualcomm infringed on Broadcom patents.
Qualcomm forecast that revenue in the current quarter would reach $2.4 billion to $2.5 billion, an increase of 8% over the year-ago quarter. That would translate to shipments of approximately 80 million to 85 million chipsets, better than 33% growth over the year-ago quarter.