Design World

  • Home
  • Technologies
    • 3D CAD
    • Electronics • electrical
    • Fastening & Joining
    • Factory automation
    • Linear Motion
    • Motion Control
    • Test & Measurement
    • Sensors
    • Fluid power
  • Learn
    • Ebooks / Tech Tips
    • Engineering Week
    • Future of Design Engineering
    • MC² Motion Control Classrooms
    • Podcasts
    • Videos
    • Webinars
  • LEAP AWARDS
  • Leadership
    • 2022 Voting
    • 2021 Winners
  • Design Guide Library
  • Resources
    • 3D Cad Models
      • PARTsolutions
      • TraceParts
    • Digital Issues
      • Design World
      • EE World
    • Women in Engineering
  • Supplier Listings

Qualcomm’s 1Q Income Halved by Investment Losses

By atesmeh | January 29, 2009

Share

Qualcomm’s first-quarter income was cut in half by heavy losses in its investment portfolio, and a weak economic outlook prompted the company to slash its year-out revenue guidance.

The chip maker reported a 56 percent decline in its first-quarter net income and posted a charge of $388 million on losses in marketable securities. The company warned it has $1.1 billion in unrealized investment losses between Dec. 28 and Jan. 23 and may post further charges if the stock market does not improve.

Qualcomm said the worldwide economic slowdown is causing handset manufacturers to keep their chipset inventories low, resulting in weakening demand for its CDMA-based MSM integrated circuits. The company expects conditions to remain soft until the second half of fiscal year 2009, when it expects to see a rise in demand from emerging markets like China.

“While our operating performance was strong, the distress in the global financial markets continued, resulting in additional impairments of our marketable securities portfolio,” said CEO Paul Jacobs in a statement.

The company’s first-quarter net income fell 56 percent to $341 million, or 20 cents a share, from $767 million, or 46 cents a share from the same period last year.

Revenue was a bit rosier, coming in at $2.52 billion, a 3 percent increase over last year’s figure of $2.44 billion. The company posted an operating cash flow of $3.5 billion, including $2.5 billion received from Nokia last October for new license and settlement agreements.

Citing ongoing turmoil in the financial markets, the company did not give out earnings per share guidance for the upcoming year and cut its previous guidance for fiscal year 2009 to a range of $9.3 billion to $9.8 billion, down from the $10.2 billion to $10.8 billion it predicted in November.

“The CDMA inventory channel has contracted as we expected, and the business environment continues to remain uncertain. Reduced visibility in the marketplace makes it difficult to forecast future inventory levels or predict when a recovery will begin. As a result, while we continue to estimate healthy growth in the CDMA-device market, we have lowered our shipment estimate for calendar year 2009,” Jacobs said.

Qualcomm is not the only company in the industry suffering from weakening demand and turmoil in the financial markets. Rival Texas Instruments announced Monday it would cut 12 percent of its workforce, or 3,400 jobs, after posting steep declines in its fourth-quarter income and revenue.

Qualcomm outsources much of its manufacturing and does not expect widespread layoffs, said CFO Bill Keitel in an interview with Reuters.

More FirstNews 01/29/09:
•  Growth Slows at T-Mobile 
•  Qualcomm’s 1Q Income Halved by Investment Losses
•  Qualcomm Keeps Pressure on DTV Date 
•  BlackBerry Storm Hits 1 Million Mark 
•  Sybase Bests Itself
•  Aylus Networks Releases MediaCast for Carriers
•  IntelliNet to Intro Integrated Femtocell Gateway
•  FirstNews Briefs for Jan. 29, 2009

 


Filed Under: Infrastructure

 

Related Articles Read More >

Do Sensors Make Infrastructure Safer?
Crawling Robots and Flying Drones May Help Missouri’s Bridges
Viasat and Facebook Collaborate to Expand Internet Connectivity in Rural Mexico
Smartphone-Based System to Monitor America’s Crumbling Infrastructure

DESIGN GUIDE LIBRARY

“motion

Enews Sign Up

Motion Control Classroom

Design World Digital Edition

cover

Browse the most current issue of Design World and back issues in an easy to use high quality format. Clip, share and download with the leading design engineering magazine today.

EDABoard the Forum for Electronics

Top global problem solving EE forum covering Microcontrollers, DSP, Networking, Analog and Digital Design, RF, Power Electronics, PCB Routing and much more

EDABoard: Forum for electronics

Sponsored Content

  • Renishaw next-generation FORTiS™ enclosed linear encoders offer enhanced metrology and reliability for machine tools
  • WAGO’s smartDESIGNER Online Provides Seamless Progression for Projects
  • Epoxy Certified for UL 1203 Standard
  • The Importance of Industrial Cable Resistance to Chemicals and Oils
  • Optimize, streamline and increase production capacity with pallet-handling conveyor systems
  • Global supply needs drive increased manufacturing footprint development

Design World Podcasts

June 12, 2022
How to avoid over engineering a part
See More >
Engineering Exchange

The Engineering Exchange is a global educational networking community for engineers.

Connect, share, and learn today »

Design World
  • Advertising
  • About us
  • Contact
  • Manage your Design World Subscription
  • Subscribe
  • Design World Digital Network
  • Engineering White Papers
  • LEAP AWARDS

Copyright © 2022 WTWH Media LLC. All Rights Reserved. The material on this site may not be reproduced, distributed, transmitted, cached or otherwise used, except with the prior written permission of WTWH Media
Privacy Policy | Advertising | About Us

Search Design World

  • Home
  • Technologies
    • 3D CAD
    • Electronics • electrical
    • Fastening & Joining
    • Factory automation
    • Linear Motion
    • Motion Control
    • Test & Measurement
    • Sensors
    • Fluid power
  • Learn
    • Ebooks / Tech Tips
    • Engineering Week
    • Future of Design Engineering
    • MC² Motion Control Classrooms
    • Podcasts
    • Videos
    • Webinars
  • LEAP AWARDS
  • Leadership
    • 2022 Voting
    • 2021 Winners
  • Design Guide Library
  • Resources
    • 3D Cad Models
      • PARTsolutions
      • TraceParts
    • Digital Issues
      • Design World
      • EE World
    • Women in Engineering
  • Supplier Listings