The Wall Street Journal-20080124-Qualcomm Lifts View On Full-Year Revenue
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Qualcomm Lifts View On Full-Year Revenue
Qualcomm Inc., bucking jitters about a slowing economy, reported an 18% jump in fiscal-first-quarter net income and slightly boosted its revenue forecast for the fiscal year.
The cellular-technology company, which yesterday also landed an important chip-purchase commitment from Motorola Inc., had seen its shares slide lately on economic worries that have hurt many technology stocks. But its stock rebounded more than 7% in after-hours trading following its announcement.
Qualcomm, based in San Diego, sells cellphone chips and charges handset makers royalties for using its patents. The company has benefited as carriers upgrade to what the industry calls third- generation, or 3G, networks that Qualcomm contends rely on its patents.
Qualcomm Chief Executive Paul Jacobs, in a conference call, cited industry statistics that global 3G subscribers reached 560 million in the quarter ended December, up 30% from the year-earlier period. He said Qualcomm's chip shipments also were up 34% in the quarter.
Qualcomm has been attacked in court by other technology companies and has suffered from reverses. At the end of December, rival Broadcom Corp. won an injunction against sales of some Qualcomm chips that were found to infringe Broadcom patents. The injunction was temporarily stayed as it relates to some of the chips; Qualcomm executives said it has temporarily stopped shipments of some products affected by the ruling, developed "work-arounds" to avoid use of the Broadcom patents and are working on other product modifications in the wake of the order.
Motorola, which has relied heavily in the past on former unit Freescale Semiconductor Inc., said yesterday it would begin new purchases from Qualcomm of chips for "low" and "mid-tier" 3G handsets.
Qualcomm predicted revenue would grow 8% to 13% in the current quarter, which ends in March. It projected earnings excluding items that include results from an investment segment would be flat to up 4%. For the fiscal year, Qualcomm raised its revenue projection to a range of $9.6 billion to $10.0 billion, up from a prediction of $9.5 billion to $9.9 billion.
