Profits at US chipmaker Qualcomm plunged nearly 90 per cent in its fiscal Q4 (calendar Q3) as the company’s patent spat with Apple dragged on.
Net income of $168 million was down 89.5 per cent year-on-year from $1.6 billion in the comparable 2016 quarter. Revenue of $5.91 billion was also down 4.5 per cent year-on-year.
Qualcomm’s dispute with Apple hit both its licensing and chip shipment figures, though CEO Steve Mollenkopf noted “strong growth trends for global 3G/4G device shipments” buoyed the latter. Chip shipments grew 4 per cent year-over-year to 220 million, but licensing revenues dropped 36 per cent to $1.2 billion.
Mollenkopf said in a statement Qualcomm is “focused on protecting the established value of our technologies and inventions”.
However, Apple’s impact on the company’s profits could linger as recent reports indicate the smartphone maker is looking to replace Qualcomm as its chip supplier. CNET senior reporter Shara Tibken noted Mollenkopf dodged a question about Apple during Qualcomm’s earnings call.
— Shara Tibken (@sharatibken) November 1, 2017
In Qualcomm’s full fiscal 2017 year, which ran to end-September, chip shipments were down 5 per cent to 804 million and licensing revenues fell 16 per cent year-on-year to $6.45 billion.
Qualcomm expects to ship between 220 million and 240 million chips in the current quarter (to end-December), and forecast total revenue for the period will drop by between 5 per cent and 8 per cent year-on-year to a range of $5.5 billion to $6.3 billion.