Qualcomm To Receive At Least $4.5 Bln From Apple Settlement
(RTTNews) - Qualcomm Inc. (QCOM) Wednesday said it expects to receive $4.5 billion to $4.7 billion from its royalty settlement with Apple.
Qualcomm, which disclosed the details in its second-quarter earnings report, said Apple paid a hefty settlement amount to end the legal battle between the two tech giants.
Qualcomm said it reached a deal with Apple on April 16, 2019. It also entered into a six-year global patent license agreement with Apple, effective as of April 1, 2019, which includes an option for Apple to extend for an additional two years, and a multi-year chipset supply agreement with Apple.
"While we continue to assess the accounting impacts of the agreements, our financial guidance for the third quarter of fiscal 2019 includes estimated revenues of $4.5 billion to $4.7 billion resulting from the settlement, consisting of a payment from Apple and the release of our obligations to pay or refund Apple and the contract manufacturers certain customer-related liabilities," the company said in the statement.
Looking forward to the third quarter, Qualcomm expects earnings of $0.70 to $0.80 per share and revenues of $4.7 billion to $5.5 billion. Analysts polled by Thomson Reuters currently expect earnings of $0.87 per share on revenues of $5.08 billion.
Qualcomm reported second-quarter profit of $663 million or $0.55 per share, up from $330 million or $0.22 per share last year.
Excluding items, adjusted earnings for the quarter were $0.77 per share. Analysts had expected earnings of $0.71 per share.
The company's revenue for the quarter fell 3.8% to $4.98 billion from $5.22 billion last year. Analysts had a consensus revenue estimate of $4.80 billion for the quarter.
QCOM closed Wednesday's trading at $86.37, up $0.24 or 0.28%, on the Nasdaq. The stock, however, slipped $3.15 or 3.65% in the after-hours trade.
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