Qualcomm Incorporated (Nasdaq: QCOM), a leading developer and innovator of advanced wireless technologies, products and services, today announced results for the third quarter of fiscal 2014 ended June 29, 2014.
"We are pleased to report another record quarter with revenues, earnings per share and chip shipments reaching all-time highs, driven by broad-based demand for our industry-leading 3G/4G chipset solutions," said Steve Mollenkopf, CEO of Qualcomm Incorporated. "Looking forward, although we have lowered our near-term financial outlook for the licensing business, we are pleased to be raising our fiscal year earnings per share guidance on better than expected performance in our semiconductor business."
Third Quarter Results (GAAP)*
- Revenues: 1 $6.81 billion, up 9 percent year-over-year (y-o-y) and 7 percent sequentially.
- Operating income: 1 $2.08 billion, up 24 percent y-o-y and 4 percent sequentially.
- Net income: 2 $2.24 billion, up 42 percent y-o-y and 14 percent sequentially.
- Diluted earnings per share: 2 $1.31, up 46 percent y-o-y and 15 percent sequentially.
- Effective tax rate: 1 10 percent.
- Operating cash flow: $2.67 billion, up 29 percent y-o-y; 39 percent of revenues.
- Return of capital to stockholders: $2.06 billion, including $1.35 billion through repurchases of 17.0 million shares of common stock and $706 million, or $0.42 per share, of cash dividends paid.
1 Throughout this news release, revenues, operating expenses, operating income, earnings before tax (EBT) and effective tax rates are from continuing operations (i.e., before adjustments for noncontrolling interests and discontinued operations), unless otherwise stated.
2 Throughout this news release, net income and diluted earnings per share are attributable to Qualcomm (i.e., after adjustments for noncontrolling interests and discontinued operations), unless otherwise stated.
Non-GAAP Third Quarter Results*
Non-GAAP results exclude the QSI (Qualcomm Strategic Initiatives) segment and certain share-based compensation, acquisition-related items and tax items.
- Revenues: $6.81 billion, up 9 percent y-o-y and 7 percent sequentially.
- Operating income: $2.43 billion, up 19 percent y-o-y and 4 percent sequentially.
- Net income: $2.47 billion, up 35 percent y-o-y and 10 percent sequentially.
- Diluted earnings per share: $1.44, up 40 percent y-o-y and 10 percent sequentially.
- Effective tax rate: 13 percent.
Detailed reconciliations between GAAP and Non-GAAP results are included within this news release.
* The following should be considered in regards to the year-over-year and sequential comparisons:
- The third quarter of fiscal 2014 results included:
- $208 million of income, or $0.12 per share, of which $184 million was recorded in other income, due to the reversal of accruals related to our litigation with ParkerVision; and
- $164 million of charges, or $0.08 per share, that resulted from an impairment on goodwill and long-lived assets related to our QMT (Qualcomm MEMS Technologies) division.
- The third quarter of fiscal 2013 results included:
- $158 million charge, or $0.06 per share, that resulted from an impairment on long-lived assets related to our QMT division.
Third Quarter Key Business Metrics
- MSM™ chip shipments: 225 million units, up 31 percent y-o-y and 20 percent sequentially.
- March quarter total reported device sales: approximately $58.1 billion, up 3 percent y-o-y and down 13 percent sequentially.
- March quarter estimated 3G/4G device shipments: approximately 250 to 254 million units, at an estimated average selling price of approximately $228 to $234 per unit.
Cash and Marketable Securities
Our cash, cash equivalents and marketable securities totaled $32.7 billion at the end of the third quarter of fiscal 2014, compared to $30.4 billion a year ago and $32.1 billion at the end of the second quarter of fiscal 2014. On July 18, 2014, we announced a cash dividend of $0.42 per share payable on September 24, 2014 to stockholders of record as of the close of business on September 3, 2014.
Research and Development