Raises Fiscal 2011 Revenue and Earnings Guidance
SAN DIEGO— April 20, 2011 — Qualcomm Incorporated (Nasdaq: QCOM), a leading developer and innovator of advanced wireless technologies, products and services, today announced results for the second quarter of fiscal 2011 ended March 27, 2011.
“We are pleased to report record quarterly revenues, and we are raising our revenue and earnings guidance for the year as the demand for smartphones across an array of geographies and tiers continues to grow,” said Dr. Paul E. Jacobs, chairman and CEO of Qualcomm. “In addition, we have resolved the second of the two previously disclosed licensee disputes. We continue to execute on our strategic priorities as our partners deploy our technologies and solutions to offer leading wireless products and services to consumers worldwide.”
Second Quarter Results (GAAP)
• Revenues: $3.88 billion, up 46 percent year-over-year (y-o-y) and 16 percent sequentially.
• Operating income: $1.07 billion, up 38 percent y-o-y and down 3 percent sequentially.
• Net income:1
• Diluted earnings per share:1 $0.59, up 28 percent y-o-y and down 17 percent sequentially. $999 million, up 29 percent y-o-y and down 15 percent sequentially.
• Effective tax rate: 21 percent for the quarter.
• Operating cash flow: $1.77 billion, up 123 percent y-o-y; 46 percent of revenues.
1 Net income and diluted earnings per share throughout this news release are attributable to Qualcomm (i.e., after adjustment for noncontrolling interests), unless otherwise stated.
Qualcomm Announces Second Quarter Fiscal 2011 Results Page 2 of 19
• Return of capital to stockholders: $316 million, or $0.19 per share, of cash dividends paid.
Non-GAAP Second Quarter Results
Non-GAAP results exclude the Qualcomm Strategic Initiatives (QSI) segment, certain share-based compensation, certain tax items that are not related to the current year and acquired in-process research and development (R&D) expense.
• Revenues: $3.87 billion, up 45 percent y-o-y and 16 percent sequentially.
• Operating income: $1.65 billion, up 55 percent y-o-y and 17 percent sequentially.
• Net income: $1.45 billion, up 47 percent y-o-y and 8 percent sequentially.
• Diluted earnings per share: $0.86, up 46 percent y-o-y and 5 percent sequentially. The current quarter excludes $0.18 loss per share attributable to the QSI segment and $0.09 loss per share attributable to certain share-based compensation.
• Effective tax rate: 22 percent for the quarter.
• Free cash flow: $1.85 billion, up 125 percent y-o-y; 48 percent of revenues (defined as net cash from operating activities less capital expenditures).
Detailed reconciliations between results reported in accordance with generally accepted accounting principles (GAAP) and Non-GAAP results are included at the end of this news release.
In the comparisons summarized above, the following should be noted with respect to results for the second quarter of fiscal 2011: GAAP and Non-GAAP results included $401 million in revenues related to prior quarters as a result of agreements entered into with two licensees to settle ongoing disputes, including an arbitration proceeding with Panasonic Mobile Communications Co. Ltd.; GAAP results included $310 million in expenses in the QSI segment related to the FLO TV™ restructuring plan; and GAAP and Non-GAAP results included $120 million in impairment charges related to our Firethorn division, including $114 million in goodwill impairment.