Qualcomm, a world-leading developer of advanced wireless technologies, reported lower earnings in its second fiscal quarter after paying a Chinese anti-monopoly fine, but the results still beat analysts’ estimates.
The San Diego-based company earned $1.1 billion, or 63 cents per share on revenue of $6.9 billion in the quarter ended March 29, compared to earnings of $2.0 billion, or $1.14 per share, on $6.4 billion in sales a year ago. Earnings in the latest quarter were reduced by $975 million, or 58 cents per share, by a fine required under China’s Anti-Monopoly Law.
Though income was down, the results exceeded analysts’ estimates. However, the company is reducing its forecast for the entire fiscal year, citing “a decline in our share at a large customer,” a reference to Samsung‘s decision to use its own processor in the Galaxy 6.
The earnings report was released after the stock market closed, and the company’s shares were down 2 percent in after-hours trading.
“We are pleased with our second quarter results, with record licensing revenues and earnings driven by all-time high 3G/4G device shipments reported by our licensees. We continue to see robust global demand for 3G/4G devices, including in China where our licensing business is now better positioned to participate in the rapidly accelerating adoption of our 3G/4G technology,” said CEO Steve Mollenkopf.
He outlined steps the company would take to reduce costs. “In addition to our ongoing expense management initiatives, we have initiated a comprehensive review of our cost structure to identify opportunities to improve operating margins while at the same time extending our technology and product leadership positions,” he said
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