Shares of Qualcomm (QCOM) are down 90 cents, or 1.7%, at $51.15, after the company disclosed late Monday that it was denied its request for a stay of an order by a Korean regulator, prompting Qualcomm to file an appeal.
In response, Rod Hall of J.P. Morgan, who has an Overweight rating on Qualcomm stock, thinks there's not a lot to worry about here, as there's little at stake globally in the Korea matter.
The Korean Fair Trade Commission of South Korea had ordered Qualcomm to "engage in good-faith negotiations," Qualcomm notes in its statement, but does not affect Qualcomm's existing licenses, among other stipulations of the "remedial" order. Qualcomm had asked for a stay of that order, but the High Court of Seoul found the order would not cause "irreparable harm" to Qualcomm, and therefore rejected Qualcomm's request.
Qualcomm said it will "file an immediate appeal of the stay decision to the Korea Supreme Court.
Writes hall, "While this is interesting, we do not believe it affects QCOM treatment in other countries."
He adds, "We also point out that the smartphone volumes in Korea are tiny relative to global volume and have little impact on Qualcomm's licensing revenue stream. Even in the case of Samsung, we understand the impact here to be only Samsung phones sold in S. Korea."
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.