000-19528 | 95-3685934 | |
(Commission File Number) | (IRS Employer Identification No.) |
5775 Morehouse Drive, San Diego, CA | 92121 | |
(Address of principal executive offices) | (Zip Code) |
Exhibit No. | Description | |
99.1 | November 6, 2013 Press Release by QUALCOMM Incorporated |
QUALCOMM Incorporated | |||||
Date: | November 6, 2013 | By: | /s/ George S. Davis | ||
George S. Davis, | |||||
Executive Vice President and Chief Financial Officer |
Exhibit No. | Description | |
99.1 | November 6, 2013 Press Release by QUALCOMM Incorporated |
• | Revenues: 1 $6.48 billion, up 33 percent year-over-year (y-o-y) and 4 percent sequentially. |
• | Operating income: 1 $1.59 billion, up 29 percent y-o-y and down 5 percent sequentially. |
• | Net income: 2 $1.50 billion, up 18 percent y-o-y and down 5 percent sequentially. |
• | Diluted earnings per share: 2 $0.86, up 18 percent y-o-y and down 4 percent sequentially. |
• | Effective tax rate: 1 18 percent. |
• | Operating cash flow: $2.52 billion, up 79 percent y-o-y; 39 percent of revenues. |
• | Return of capital to stockholders: $3.91 billion, including $3.32 billion through repurchases of 50.7 million shares of common stock and $592 million, or $0.35 per share, of cash dividends paid. |
• | Revenues: $24.87 billion, up 30 percent y-o-y. |
• | Operating income: $7.23 billion, up 27 percent y-o-y. |
• | Net income: $6.85 billion, up 12 percent y-o-y. |
• | Diluted earnings per share: $3.91, up 11 percent y-o-y. |
• | Effective tax rate: 16 percent. |
• | Operating cash flow: $8.78 billion, up 46 percent y-o-y; 35 percent of revenues. |
• | Return of capital to stockholders: $6.66 billion, including $4.61 billion through repurchases of 71.7 million shares of common stock and $2.05 billion, or $1.20 per share, of cash dividends paid. |
• | Revenues: $6.48 billion, up 33 percent y-o-y and 4 percent sequentially. |
• | Operating income: $1.94 billion, up 20 percent y-o-y and down 5 percent sequentially. |
• | Net income: $1.82 billion, up 18 percent y-o-y and even sequentially. |
• | Diluted earnings per share: $1.05, up 18 percent y-o-y and 2 percent sequentially. |
• | Effective tax rate: 16 percent. |
• | Free cash flow (defined as net cash from operating activities less capital expenditures): $2.38 billion, up 92 percent y-o-y; 37 percent of revenues. |
• | Revenues: $24.87 billion, up 30 percent y-o-y. |
• | Operating income: $8.66 billion, up 22 percent y-o-y. |
• | Net income: $7.91 billion, up 22 percent y-o-y. |
• | Diluted earnings per share: $4.51, up 22 percent y-o-y. |
• | Effective tax rate: 17 percent. |
• | Free cash flow: $8.08 billion, up 55 percent y-o-y; 32 percent of revenues. |
• | MSMTM chip shipments: 190 million units, up 35 percent y-o-y and 10 percent sequentially. |
• | June quarter total reported device sales: approximately $60.2 billion, up 29 percent y-o-y and 7 percent sequentially. |
◦ | June quarter estimated 3G/4G device shipments: approximately 260 to 264 million units, at an estimated average selling price of approximately $227 to $233 per unit. |
• | MSM chip shipments: 716 million units, up 21 percent y-o-y. |
• | Total reported device sales: approximately $231.2 billion, up 23 percent y-o-y. |
◦ | Estimated 3G/4G device shipments: approximately 1,017 to 1,033 million units, at an estimated average selling price of approximately $223 to $229 per unit. |
($ in millions) | Non-GAAP | QSI | Share-Based Compensation | Acquisition-Related Items | GAAP | ||||||||||||||
Fourth quarter fiscal 2013 | $ | 1,182 | $ | 1 | $ | 164 | $ | 1 | $ | 1,348 | |||||||||
As % of revenues | 18 | % | 21 | % | |||||||||||||||
Fourth quarter fiscal 2012 | $ | 961 | $ | 1 | $ | 152 | $ | — | $ | 1,114 | |||||||||
As % of revenues | 20 | % | 23 | % | |||||||||||||||
Year-over-year change ($) | 23 | % | N/M | 8 | % | N/M | 21 | % |
($ in millions) | Non-GAAP | QSI | Share-Based Compensation | Acquisition-Related Items | GAAP | ||||||||||||||
Fourth quarter fiscal 2013 | $ | 547 | $ | 10 | $ | 94 | $ | 6 | $ | 657 | |||||||||
As % of revenues | 8 | % | 10 | % | |||||||||||||||
Fourth quarter fiscal 2012 | $ | 491 | $ | 3 | $ | 112 | $ | 21 | $ | 627 | |||||||||
As % of revenues | 10 | % | 13 | % | |||||||||||||||
Year-over-year change ($) | 11 | % | N/M | (16 | %) | N/M | 5 | % |
FIRST FISCAL QUARTER | |||||||
Q1 FY13 Results | Current Guidance Q1 FY14 Estimates (2) | ||||||
Revenues | $6.02 | B | $6.3B - $6.9B | ||||
Year-over-year change | increase 5% - 15% | ||||||
Non-GAAP diluted earnings per share (EPS) | $1.26 | $1.10 - $1.20 | |||||
Year-over-year change | decrease 5% - 13% | ||||||
Diluted EPS attributable to QSI | ($0.01 | ) | ($0.01 | ) | |||
Diluted EPS attributable to share-based compensation | ($0.12 | ) | ($0.13 | ) | |||
Diluted EPS attributable to acquisition-related items | ($0.04 | ) | ($0.04 | ) | |||
GAAP diluted EPS | $1.09 | $0.92 - $1.02 | |||||
Year-over-year change | decrease 6% - 16% | ||||||
Metrics | |||||||
MSM chip shipments | 182M | 195M - 210M | |||||
Year-over-year change | increase 7% - 15% | ||||||
Total reported device sales (1) | approx. $53.3B* | approx. $57.5B - $63.5B* | |||||
Year-over-year change | increase 8% - 19% | ||||||
*Est. sales in September quarter, reported in December quarter |
FISCAL YEAR | |||||||
FY 2013 Results | Current Guidance FY 2014 Estimates (2) (3) | ||||||
Revenues | $24.87 | B | $26.0B - $27.5B | ||||
Year-over-year change | increase 5% - 11% | ||||||
Non-GAAP diluted EPS | $4.51 | $4.95 - $5.15 | |||||
Year-over-year change | increase 10% - 14% | ||||||
Diluted EPS attributable to QSI | $0.02 | ($0.03 | ) | ||||
Diluted EPS attributable to share-based compensation | ($0.51 | ) | ($0.51 | ) | |||
Diluted EPS attributable to acquisition-related items | ($0.16 | ) | ($0.16 | ) | |||
Diluted EPS attributable to tax items | $0.04 | N/A | |||||
GAAP diluted EPS | $3.91 | $4.25 - $4.45 | |||||
Year-over-year change | increase 9% - 14% | ||||||
Metrics | |||||||
Est. fiscal year* 3G/4G device average selling price range (1) | approx. $223 - $229 | approx. $216 - $230 | |||||
*Shipments in Sept. to June quarters, reported in Dec. to Sept. quarters |
CALENDAR YEAR Device Estimates (1) | ||||
Prior Guidance Calendar 2013 Estimates | Current Guidance Calendar 2013 Estimates | Current Guidance Calendar 2014 Estimates | ||
Est. 3G/4G device shipments | ||||
March quarter | approx. 244M - 248M | approx. 244M - 248M | not provided | |
June quarter | not provided | approx. 260M - 264M | not provided | |
September quarter | not provided | not provided | not provided | |
December quarter | not provided | not provided | not provided | |
Est. calendar year range (approx.) | 1,015M - 1,085M | 1,075M - 1,125M | 1,220M - 1,300M | |
Est. calendar year midpoint (approx.) (4) | 1,050M | 1,100M | 1,260M |
(1) | Total reported device sales is the sum of all reported sales in U.S. dollars (as reported to us by our licensees) of all licensed CDMA-based, OFDMA-based and CDMA/OFDMA multimode subscriber devices (including handsets, modules, modem cards and other subscriber devices) by our licensees during a particular period (collectively, 3G/4G devices). The reported quarterly estimated ranges of average selling prices (ASPs) and unit shipments are determined based on the information as reported to us by our licensees during the relevant period and our own estimates of the selling prices and unit shipments for licensees that do not provide such information. Not all licensees report sales, selling prices and/or unit shipments the same way (e.g., some licensees report selling prices net of permitted deductions, such as transportation, insurance and packing costs, while other licensees report selling prices and then identify the amount of permitted deductions in their reports), and the way in which licensees report such information may change from time to time. Total reported device sales, estimated unit shipments and estimated ASPs for a particular period may include prior period activity that was not reported by the licensee until such particular period. |
(2) | Q1 and FY 2014 guidance excludes the expected gain on sale of the North and Latin American operations of our Omnitracs division. We expect the transaction to close in the first quarter of fiscal 2014. Upon close, we expect to record a gain on sale of approx. $0.22 to $0.25 EPS. |
(3) | FY 2014 guidance includes an estimate of the benefit related to approx. $4 billion in stock repurchases that we plan to complete over the course of fiscal 2014 under our current stock repurchase program. FY 2014 guidance also reflects an annual effective tax rate that includes an estimate of the United States federal R&D tax credit expected to be generated through December 31, 2013, the date on which the credit will expire. |
(4) | The midpoints of the estimated calendar year ranges are identified for comparison purposes only and do not indicate a higher degree of confidence in the midpoints. |
SEGMENTS | QCT | QTL | QWI | Non-GAAP Reconciling Items (1) | Non-GAAP (2) | QSI (2) | Share-Based Compensation (2) | Acquisition-Related Items (2) | Tax Items | GAAP | ||||||||||||||||
Q4 - FISCAL 2013 | ||||||||||||||||||||||||||
Revenues | $4,457 | $1,874 | $154 | ($5) | $6,480 | $— | $— | $— | $— | $6,480 | ||||||||||||||||
Change from prior year | 42 | % | 19 | % | (4 | %) | N/M | 33 | % | 33 | % | |||||||||||||||
Change from prior quarter | 6 | % | — | % | (3 | %) | N/M | 4 | % | 4 | % | |||||||||||||||
Operating income (loss) | $1,940 | ($11) | ($274) | ($67) | $— | $1,588 | ||||||||||||||||||||
Change from prior year | 20 | % | N/M | 4 | % | 25 | % | 29 | % | |||||||||||||||||
Change from prior quarter | (5 | %) | (57 | %) | 2 | % | 6 | % | (5 | %) | ||||||||||||||||
EBT | $702 | $1,622 | $12 | ($163) | $2,173 | ($11) | ($274) | ($67) | $— | $1,821 | ||||||||||||||||
Change from prior year | 44 | % | 18 | % | N/M | N/M | 13 | % | 48 | % | 4 | % | 25 | % | 19 | % | ||||||||||
Change from prior quarter | (5 | %) | (1 | %) | N/M | N/M | (2 | %) | N/M | 2 | % | 6 | % | (5 | %) | |||||||||||
EBT as % of revenues | 16 | % | 87 | % | 8 | % | N/M | 34 | % | 28 | % | |||||||||||||||
Net income (loss) | $1,818 | ($24) | ($226) | ($67) | $— | $1,501 | ||||||||||||||||||||
Change from prior year | 18 | % | N/M | (2 | %) | 14 | % | N/M | 18 | % | ||||||||||||||||
Change from prior quarter | — | % | N/M | (2 | %) | (5 | %) | N/A | (5 | %) | ||||||||||||||||
Diluted EPS | $1.05 | ($0.01) | ($0.13) | ($0.04) | $— | $0.86 | ||||||||||||||||||||
Change from prior year | 18 | % | N/M | — | % | — | % | N/M | 18 | % | ||||||||||||||||
Change from prior quarter | 2 | % | N/M | — | % | — | % | N/A | (4 | %) | ||||||||||||||||
Diluted shares used | 1,738 | 1,738 | 1,738 | 1,738 | 1,738 | 1,738 | ||||||||||||||||||||
Q3 - FISCAL 2013 | ||||||||||||||||||||||||||
Revenues | $4,222 | $1,867 | $158 | ($4) | $6,243 | $— | $— | $— | $— | $6,243 | ||||||||||||||||
Operating income (loss) | 2,035 | (7) | (280) | (71) | $ | 1,677 | ||||||||||||||||||||
EBT | $738 | $1,633 | ($16) | ($145) | 2,210 | 51 | (280) | (71) | $ | 1,910 | ||||||||||||||||
Net income (loss) | 1,823 | 43 | (222) | (64) | — | 1,580 | ||||||||||||||||||||
Diluted EPS | $1.03 | $0.02 | ($0.13) | ($0.04) | $— | $0.90 | ||||||||||||||||||||
Diluted shares used | 1,765 | 1,765 | 1,765 | 1,765 | 1,765 | 1,765 | ||||||||||||||||||||
Q4 - FISCAL 2012 | ||||||||||||||||||||||||||
Revenues | $3,129 | $1,572 | $161 | $9 | $4,871 | $— | $— | $— | $— | $4,871 | ||||||||||||||||
Operating income (loss) | 1,612 | (4) | (284) | (89) | $ | 1,235 | ||||||||||||||||||||
EBT | $486 | $1,370 | ($1) | $65 | 1,920 | (21) | (284) | (89) | $ | 1,526 | ||||||||||||||||
Discontinued operations, net of tax | — | 23 | — | — | — | 23 | ||||||||||||||||||||
Net income (loss) | 1,547 | 14 | (222) | (78) | 10 | 1,271 | ||||||||||||||||||||
Diluted EPS | $0.89 | $0.01 | ($0.13) | ($0.04) | $0.01 | $0.73 | ||||||||||||||||||||
Diluted shares used | 1,745 | 1,745 | 1,745 | 1,745 | 1,745 | 1,745 | ||||||||||||||||||||
Q1 - FISCAL 2013 | ||||||||||||||||||||||||||
Revenues | $4,120 | $1,757 | $146 | ($5) | $6,018 | $— | $— | $— | $— | $6,018 | ||||||||||||||||
Operating income (loss) | 2,447 | (8) | (281) | (70) | $ | 2,088 | ||||||||||||||||||||
EBT | $1,068 | $1,532 | ($3) | $98 | 2,695 | (17) | (281) | (70) | $ | 2,327 | ||||||||||||||||
Net income (loss) | 2,204 | (12) | (219) | (67) | — | 1,906 | ||||||||||||||||||||
Diluted EPS | $1.26 | ($0.01) | ($0.12) | ($0.04) | $— | $1.09 | ||||||||||||||||||||
Diluted shares used | 1,751 | 1,751 | 1,751 | 1,751 | 1,751 | 1,751 |
SEGMENTS | QCT | QTL | QWI | Non-GAAP Reconciling Items (1) | Non-GAAP (2) | QSI (2) | Share-Based Compensation (2) | Acquisition-Related Items (2) | Tax Items | GAAP | ||||||||||||||||
12 MONTHS - FISCAL 2013 | ||||||||||||||||||||||||||
Revenues | $16,715 | $7,554 | $613 | ($16) | $24,866 | $— | $— | $— | $— | $24,866 | ||||||||||||||||
Change from prior year | 38 | % | 19 | % | (3 | %) | N/M | 30 | % | 30 | % | |||||||||||||||
Operating income (loss) | $8,657 | ($31) | ($1,103) | ($293) | $— | $7,230 | ||||||||||||||||||||
Change from prior year | 22 | % | 73 | % | (7 | %) | (10 | %) | 27 | % | ||||||||||||||||
EBT | $3,189 | $6,590 | ($8) | ($237) | $9,534 | $56 | ($1,103) | ($293) | $— | $8,194 | ||||||||||||||||
Change from prior year | 39 | % | 18 | % | 47 | % | N/M | 19 | % | N/M | (7 | %) | (10 | %) | 25 | % | ||||||||||
EBT as % of revenues | 19 | % | 87 | % | (1 | %) | N/M | 38 | % | 33 | % | |||||||||||||||
Net income (loss) | $7,911 | $43 | ($886) | ($279) | $64 | $6,853 | ||||||||||||||||||||
Change from prior year | 22 | % | (94 | %) | (9 | %) | (15 | %) | N/M | 12 | % | |||||||||||||||
Diluted EPS | $4.51 | $0.02 | ($0.51) | ($0.16) | $0.04 | $3.91 | ||||||||||||||||||||
Change from prior year | 22 | % | (95 | %) | (9 | %) | (14 | %) | N/M | 11 | % | |||||||||||||||
Diluted shares used | 1,754 | 1,754 | 1,754 | 1,754 | 1,754 | 1,754 | ||||||||||||||||||||
12 MONTHS - FISCAL 2012 | ||||||||||||||||||||||||||
Revenues | $12,141 | $6,327 | $633 | $20 | $19,121 | $— | $— | $— | $— | $19,121 | ||||||||||||||||
Operating income (loss) | 7,100 | (116) | (1,035) | (267) | — | 5,682 | ||||||||||||||||||||
EBT | $2,296 | $5,585 | ($15) | $168 | 8,034 | (170) | (1,035) | (267) | — | 6,562 | ||||||||||||||||
Discontinued operations, net of tax | — | 777 | (1) | — | — | 776 | ||||||||||||||||||||
Net income (loss) | 6,463 | 690 | (811) | (243) | 10 | 6,109 | ||||||||||||||||||||
Diluted EPS | $3.71 | $0.40 | ($0.47) | ($0.14) | $0.01 | $3.51 | ||||||||||||||||||||
Diluted shares used | 1,741 | 1,741 | 1,741 | 1,741 | 1,741 | 1,741 |
(1) | Non-GAAP reconciling items related to revenues consisted primarily of nonreportable segment revenues less intersegment eliminations. Non-GAAP reconciling items related to earnings before taxes consist primarily of certain costs of equipment and services revenues, research and development expenses, sales and marketing expenses, other operating expenses and certain investment income or losses and interest expense that are not allocated to the segments for management reporting purposes; nonreportable segment results; and the elimination of intersegment profit. |
(2) | At fiscal year end, the sum of the quarterly tax provision (benefit) for each column equals the annual tax provision (benefit) for each column computed in accordance with GAAP. In interim quarters, the sum of these provisions (benefits) may not equal the total GAAP tax provision, and this difference is allocated to tax provisions (benefits) among the columns. |
• | QSI is excluded because the Company expects to exit its strategic investments at various times, and the effects of fluctuations in the value of such investments and realized gains or losses are viewed by management as unrelated to the Company’s operational performance. |
• | Share-based compensation expense primarily relates to restricted stock units and stock options. Certain share-based compensation is excluded because management views such expenses as unrelated to the operating activities of the Company’s ongoing core businesses. Further, the fair values of share-based awards are affected by factors that are variable on each grant date, which may include the Company’s stock price, stock market volatility, expected award life, risk-free interest rates and expected dividend payouts in future years. |
• | Acquisition-related items relate to amortization and impairment of certain intangible assets, recognition of the step-up of inventories to fair value and the related tax effects of these items starting with acquisitions completed in the third quarter of fiscal 2011, as well as any tax effects from restructuring the ownership of such acquired assets. Additionally, starting with acquisitions completed in the fourth quarter of fiscal 2012, the Company began excluding expenses related to the termination of contracts that limit the use of the acquired intellectual property. These acquisition-related items are excluded and are not allocated to the Company’s segments because management views such expenses as unrelated to the operating activities of the Company’s ongoing core businesses. In addition, these charges are impacted by the size and timing of acquisitions, potentially obscuring period to period comparisons of the Company’s operating businesses. |
• | Certain tax items that are unrelated to the fiscal year in which they were recorded are excluded in order to provide a clearer understanding of the Company’s ongoing Non-GAAP tax rate and after tax earnings. |
Three Months Ended September 29, 2013 | ||||||||||||||||||||||||||
Non-GAAP Results | QSI | Share-Based Compensation | Acquisition-Related Items (a) | GAAP Results | ||||||||||||||||||||||
($ in millions, except per share data) | ||||||||||||||||||||||||||
Cost of equipment and services revenues | $ | 2,638 | $ | — | $ | 16 | $ | 60 | $ | 2,714 | ||||||||||||||||
R&D | 1,182 | 1 | 164 | 1 | 1,348 | |||||||||||||||||||||
SG&A | 547 | 10 | 94 | 6 | 657 | |||||||||||||||||||||
Other expenses | 173 | (b) | — | — | — | 173 | ||||||||||||||||||||
Operating income (loss) | 1,940 | (11 | ) | (274 | ) | (67 | ) | 1,588 | ||||||||||||||||||
Investment income, net | $ | 233 | (c) | $ | — | (d) | $ | — | $ | — | $ | 233 | ||||||||||||||
Tax rate | 16 | % | N/M | 18 | % | — | % | 18 | % | |||||||||||||||||
Net income (loss) | $ | 1,818 | $ | (24 | ) | $ | (226 | ) | $ | (67 | ) | $ | 1,501 | |||||||||||||
Diluted EPS | $ | 1.05 | $ | (0.01 | ) | $ | (0.13 | ) | $ | (0.04 | ) | $ | 0.86 |
(a) | Included amortization and impairment of certain intangible assets and the recognition of the step-up of inventories to fair value. |
(b) | Included a $173 million charge, or $0.10 per share, related to the recent verdict in our litigation with ParkerVision. |
(c) | Included $168 million in interest and dividend income, $112 million in net realized gains on investments and $7 million in gains on deconsolidation of subsidiaries, partially offset by $35 million in other-than-temporary losses on investments, $18 million in net losses on derivatives and $1 million in interest expense. |
(d) | Included $17 million in net realized gains on investments and $1 million in interest and dividend income, offset by $16 million in losses on deconsolidation of subsidiaries, $1 million in other-than-temporary losses on investments and $1 million in equity in net losses of investees. |
Twelve Months Ended September 29, 2013 | |||||||||||||||||||||||||||||||
Non-GAAP Results | QSI | Share-Based Compensation | Acquisition-Related Items (e) | Tax Items (f) | GAAP Results | ||||||||||||||||||||||||||
($ in millions, except per share data) | |||||||||||||||||||||||||||||||
Cost of equipment and services revenues | $ | 9,485 | $ | — | $ | 71 | $ | 264 | $ | — | $ | 9,820 | |||||||||||||||||||
R&D | 4,318 | 4 | 642 | 3 | — | 4,967 | |||||||||||||||||||||||||
SG&A | 2,075 | 27 | 390 | 26 | — | 2,518 | |||||||||||||||||||||||||
Other expenses | 331 | (g) | — | — | — | — | 331 | ||||||||||||||||||||||||
Operating income (loss) | 8,657 | (31 | ) | (1,103 | ) | (293 | ) | — | 7,230 | ||||||||||||||||||||||
Investment income, net | $ | 877 | (h) | $ | 87 | (i) | $ | — | $ | — | $ | — | $ | 964 | |||||||||||||||||
Tax rate | 17 | % | 38 | % | 20 | % | 5 | % | N/A | 16 | % | ||||||||||||||||||||
Net income (loss) | $ | 7,911 | $ | 43 | $ | (886 | ) | $ | (279 | ) | $ | 64 | $ | 6,853 | |||||||||||||||||
Diluted EPS | $ | 4.51 | $ | 0.02 | $ | (0.51 | ) | $ | (0.16 | ) | $ | 0.04 | $ | 3.91 |
(e) | Included amortization and impairment of certain intangible assets, expense associated with the termination of a contract and the recognition of the step-up of inventories to fair value. |
(f) | Included a $64 million tax benefit as a result of the retroactive reinstatement of the federal R&D tax credit related to fiscal 2012. |
(g) | Included a $173 million charge, or $0.10 per share, related to the recent verdict in our litigation with ParkerVision and a $158 million loss, or $0.06 per share, that resulted from an impairment charge on certain long-lived assets related to our QMT division. |
(h) | Included $689 million in interest and dividend income, $259 million in net realized gains on investments and $6 million in gains on deconsolidation of subsidiaries, partially offset by $71 million in other-than-temporary losses on investments, $5 million in interest expense and $1 million in net losses on derivatives. |
(i) | Included $110 million in net realized gains on investments, $8 million in interest and dividend income, $6 million in gains on deconsolidation of subsidiaries and $1 million in net gains on derivatives, partially offset by $18 million in interest expense, $14 million in other-than-temporary losses on investments and $6 million in equity in net losses of investees. |
Three Months Ended September 29, 2013 | |||||||||||||||
Non-GAAP | QSI | Share-Based Compensation | GAAP | ||||||||||||
Net cash provided (used) by operating activities | $ | 2,583 | $ | (7 | ) | $ | (53 | ) | (a) | $ | 2,523 | ||||
Less: capital expenditures | (200 | ) | — | — | (200 | ) | |||||||||
Free cash flow | $ | 2,383 | $ | (7 | ) | $ | (53 | ) | $ | 2,323 | |||||
Revenues | $ | 6,480 | $ | — | $ | — | $ | 6,480 | |||||||
Operating cash flow as % of revenues | 40 | % | N/A | N/A | 39 | % | |||||||||
Free cash flow as % of revenues | 37 | % | N/A | N/A | 36 | % | |||||||||
Twelve Months Ended September 29, 2013 | |||||||||||||||
Non-GAAP | QSI | Share-Based Compensation | GAAP | ||||||||||||
Net cash provided (used) by operating activities | $ | 9,052 | $ | (43 | ) | $ | (231 | ) | (a) | $ | 8,778 | ||||
Less: capital expenditures | (973 | ) | (75 | ) | — | (1,048 | ) | ||||||||
Free cash flow | $ | 8,079 | $ | (118 | ) | $ | (231 | ) | $ | 7,730 | |||||
Revenues | $ | 24,866 | $ | — | $ | — | $ | 24,866 | |||||||
Operating cash flow as % of revenues | 36 | % | N/A | N/A | 35 | % | |||||||||
Free cash flow as % of revenues | 32 | % | N/A | N/A | 31 | % | |||||||||
Three Months Ended September 30, 2012 | |||||||||||||||
Non-GAAP | QSI | Share-Based Compensation | GAAP | ||||||||||||
Net cash provided (used) by operating activities | $ | 1,476 | $ | (26 | ) | $ | (41 | ) | (a) | $ | 1,409 | ||||
Less: capital expenditures | (234 | ) | (16 | ) | — | (250 | ) | ||||||||
Free cash flow | $ | 1,242 | $ | (42 | ) | $ | (41 | ) | $ | 1,159 | |||||
Revenues | $ | 4,871 | $ | — | $ | — | $ | 4,871 | |||||||
Operating cash flow as % of revenues | 30 | % | N/A | N/A | 29 | % | |||||||||
Free cash flow as % of revenues | 25 | % | N/A | N/A | 24 | % | |||||||||
Twelve Months Ended September 30, 2012 | |||||||||||||||
Non-GAAP | QSI | Share-Based Compensation | GAAP | ||||||||||||
Net cash provided (used) by operating activities | $ | 6,382 | $ | (216 | ) | $ | (168 | ) | (a) | $ | 5,998 | ||||
Less: capital expenditures | (1,183 | ) | (101 | ) | — | (1,284 | ) | ||||||||
Free cash flow | $ | 5,199 | $ | (317 | ) | $ | (168 | ) | $ | 4,714 | |||||
Revenues | $ | 19,121 | $ | — | $ | — | $ | 19,121 | |||||||
Operating cash flow as % of revenues | 33 | % | N/A | N/A | 31 | % | |||||||||
Free cash flow as % of revenues | 27 | % | N/A | N/A | 25 | % |
(a) | Incremental tax benefits from share-based compensation during the period. |
Three Months Ended September 29, 2013 | |||||||||||||||||||||||
Non-GAAP Results | QSI | Share-Based Compensation | Acquisition-Related Items | Tax Items | GAAP Results | ||||||||||||||||||
Income (loss) from continuing operations before income taxes | $ | 2,173 | $ | (11 | ) | $ | (274 | ) | $ | (67 | ) | $ | — | $ | 1,821 | ||||||||
Income tax (expense) benefit | (354 | ) | (14 | ) | 48 | — | — | (320 | ) | ||||||||||||||
Income (loss) from continuing operations | $ | 1,819 | $ | (25 | ) | $ | (226 | ) | $ | (67 | ) | $ | — | $ | 1,501 | ||||||||
Tax rate | 16 | % | N/M | 18 | % | — | % | N/A | 18 | % | |||||||||||||
Twelve Months Ended September 29, 2013 | |||||||||||||||||||||||
Non-GAAP Results | QSI | Share-Based Compensation | Acquisition-Related Items | Tax Items (b) | GAAP Results | ||||||||||||||||||
Income (loss) from continuing operations before income taxes | $ | 9,534 | $ | 56 | $ | (1,103 | ) | $ | (293 | ) | $ | — | $ | 8,194 | |||||||||
Income tax (expense) benefit | (1,623 | ) | (21 | ) | 217 | 14 | 64 | (1,349 | ) | ||||||||||||||
Income (loss) from continuing operations | $ | 7,911 | $ | 35 | $ | (886 | ) | $ | (279 | ) | $ | 64 | $ | 6,845 | |||||||||
Tax rate | 17 | % | 38 | % | 20 | % | 5 | % | N/A | 16 | % | ||||||||||||
(a) | At fiscal year end, the sum of the quarterly tax provision (benefit) for each column equals the annual tax provision (benefit) for each column computed in accordance with GAAP. In interim quarters, the sum of these provisions (benefits) may not equal the total GAAP tax provision, and this difference is allocated to tax provisions (benefits) among the columns. |
(b) | During fiscal 2013, we recorded a tax benefit of $64 million related to fiscal 2012 due to the retroactive reinstatement of the United States federal R&D tax credit. |
September 29, 2013 | September 30, 2012 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 6,142 | $ | 3,807 | |||
Marketable securities | 8,824 | 8,567 | |||||
Accounts receivable, net | 2,142 | 1,459 | |||||
Inventories | 1,302 | 1,030 | |||||
Deferred tax assets | 573 | 309 | |||||
Other current assets | 572 | 473 | |||||
Total current assets | 19,555 | 15,645 | |||||
Marketable securities | 14,440 | 14,463 | |||||
Deferred tax assets | 1,059 | 1,412 | |||||
Assets held for sale | 72 | 1,109 | |||||
Property, plant and equipment, net | 2,995 | 2,851 | |||||
Goodwill | 3,976 | 3,917 | |||||
Other intangible assets, net | 2,553 | 2,938 | |||||
Other assets | 866 | 677 | |||||
Total assets | $ | 45,516 | $ | 43,012 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Trade accounts payable | $ | 1,554 | $ | 1,298 | |||
Payroll and other benefits related liabilities | 839 | 664 | |||||
Unearned revenues | 501 | 545 | |||||
Liabilities held for sale | 43 | 1,072 | |||||
Other current liabilities | 2,276 | 1,723 | |||||
Total current liabilities | 5,213 | 5,302 | |||||
Unearned revenues | 3,666 | 3,739 | |||||
Other liabilities | 550 | 426 | |||||
Total liabilities | 9,429 | 9,467 | |||||
Stockholders’ equity: | |||||||
Qualcomm stockholders’ equity: | |||||||
Preferred stock, $0.0001 par value; issuable in series; 8 shares authorized; none outstanding | — | — | |||||
Common stock, $0.0001 par value; 6,000 shares authorized; 1,685 and 1,706 shares issued and outstanding, respectively | — | — | |||||
Paid-in capital | 9,874 | 11,956 | |||||
Retained earnings | 25,461 | 20,701 | |||||
Accumulated other comprehensive income | 753 | 866 | |||||
Total Qualcomm stockholders’ equity | 36,088 | 33,523 | |||||
Noncontrolling interests | (1 | ) | 22 | ||||
Total stockholders’ equity | 36,087 | 33,545 | |||||
Total liabilities and stockholders’ equity | $ | 45,516 | $ | 43,012 |
Three Months Ended | Twelve Months Ended | ||||||||||||||
September 29, 2013 | September 30, 2012 | September 29, 2013 | September 30, 2012 | ||||||||||||
Revenues: | |||||||||||||||
Equipment and services | $ | 4,513 | $ | 3,213 | $ | 16,988 | $ | 12,465 | |||||||
Licensing | 1,967 | 1,658 | 7,878 | 6,656 | |||||||||||
Total revenues | 6,480 | 4,871 | 24,866 | 19,121 | |||||||||||
Costs and expenses: | |||||||||||||||
Cost of equipment and services revenues | 2,714 | 1,841 | 9,820 | 7,096 | |||||||||||
Research and development | 1,348 | 1,114 | 4,967 | 3,915 | |||||||||||
Selling, general and administrative | 657 | 627 | 2,518 | 2,270 | |||||||||||
Other | 173 | 54 | 331 | 158 | |||||||||||
Total costs and expenses | 4,892 | 3,636 | 17,636 | 13,439 | |||||||||||
Operating income | 1,588 | 1,235 | 7,230 | 5,682 | |||||||||||
Investment income, net | 233 | 291 | 964 | 880 | |||||||||||
Income from continuing operations before income taxes | 1,821 | 1,526 | 8,194 | 6,562 | |||||||||||
Income tax expense | (320 | ) | (286 | ) | (1,349 | ) | (1,279 | ) | |||||||
Income from continuing operations | 1,501 | 1,240 | 6,845 | 5,283 | |||||||||||
Discontinued operations, net of income taxes | — | 23 | — | 776 | |||||||||||
Net income | 1,501 | 1,263 | 6,845 | 6,059 | |||||||||||
Net loss attributable to noncontrolling interests | — | 8 | 8 | 50 | |||||||||||
Net income attributable to Qualcomm | $ | 1,501 | $ | 1,271 | $ | 6,853 | $ | 6,109 | |||||||
Basic earnings per share attributable to Qualcomm: | |||||||||||||||
Continuing operations | $ | 0.88 | $ | 0.73 | $ | 3.99 | $ | 3.14 | |||||||
Discontinued operations | — | 0.02 | — | 0.45 | |||||||||||
Net income | $ | 0.88 | $ | 0.75 | $ | 3.99 | $ | 3.59 | |||||||
Diluted earnings per share attributable to Qualcomm: | |||||||||||||||
Continuing operations | $ | 0.86 | $ | 0.72 | $ | 3.91 | $ | 3.06 | |||||||
Discontinued operations | — | 0.01 | — | 0.45 | |||||||||||
Net income | $ | 0.86 | $ | 0.73 | $ | 3.91 | $ | 3.51 | |||||||
Shares used in per share calculations: | |||||||||||||||
Basic | 1,703 | 1,704 | 1,715 | 1,700 | |||||||||||
Diluted | 1,738 | 1,745 | 1,754 | 1,741 | |||||||||||
Dividends per share announced | $ | 0.35 | $ | 0.25 | $ | 1.20 | $ | 0.93 |
Three Months Ended | Twelve Months Ended | ||||||||||||||
September 29, 2013 | September 30, 2012 | September 29, 2013 | September 30, 2012 | ||||||||||||
Operating Activities: | |||||||||||||||
Net income | $ | 1,501 | $ | 1,263 | $ | 6,845 | $ | 6,059 | |||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||
Depreciation and amortization expense | 273 | 257 | 1,017 | 897 | |||||||||||
Gain on sale of wireless spectrum | — | — | — | (1,179 | ) | ||||||||||
Goodwill and long-lived asset impairment charges | 1 | 59 | 192 | 84 | |||||||||||
Revenues related to non-monetary exchanges | (30 | ) | (30 | ) | (123 | ) | (122 | ) | |||||||
Income tax provision in excess of income tax payments | 48 | 156 | 268 | 395 | |||||||||||
Non-cash portion of share-based compensation expense | 274 | 283 | 1,105 | 1,035 | |||||||||||
Incremental tax benefit from share-based compensation | (53 | ) | (41 | ) | (231 | ) | (168 | ) | |||||||
Net realized gains on marketable securities and other investments | (129 | ) | (155 | ) | (369 | ) | (369 | ) | |||||||
Net impairment losses on marketable securities and other investments | 36 | 19 | 85 | 83 | |||||||||||
Other items, net | 82 | 10 | 104 | (52 | ) | ||||||||||
Changes in assets and liabilities, net of effects of acquisitions: | |||||||||||||||
Accounts receivable, net | (235 | ) | (207 | ) | (680 | ) | (456 | ) | |||||||
Inventories | 399 | (199 | ) | (300 | ) | (252 | ) | ||||||||
Other assets | (98 | ) | (209 | ) | (209 | ) | (240 | ) | |||||||
Trade accounts payable | (291 | ) | 174 | 307 | 371 | ||||||||||
Payroll, benefits and other liabilities | 700 | 71 | 752 | (341 | ) | ||||||||||
Unearned revenues | 45 | (42 | ) | 15 | 253 | ||||||||||
Net cash provided by operating activities | 2,523 | 1,409 | 8,778 | 5,998 | |||||||||||
Investing Activities: | |||||||||||||||
Capital expenditures | (200 | ) | (250 | ) | (1,048 | ) | (1,284 | ) | |||||||
Purchases of available-for-sale securities | (1,839 | ) | (3,707 | ) | (13,951 | ) | (15,511 | ) | |||||||
Proceeds from sales and maturities of available-for-sale securities | 6,157 | 4,084 | 13,494 | 9,858 | |||||||||||
Purchases of trading securities | (654 | ) | (1,729 | ) | (3,312 | ) | (4,009 | ) | |||||||
Proceeds from sales and maturities of trading securities | 1,002 | 1,763 | 3,367 | 3,060 | |||||||||||
Proceeds from sale of wireless spectrum | — | — | — | 1,925 | |||||||||||
Acquisitions and other investments, net of cash acquired | (13 | ) | (156 | ) | (192 | ) | (833 | ) | |||||||
Other items, net | (4 | ) | (7 | ) | 64 | (83 | ) | ||||||||
Net cash provided (used) by investing activities | 4,449 | (2 | ) | (1,578 | ) | (6,877 | ) | ||||||||
Financing Activities: | |||||||||||||||
Borrowing under loans and debentures | — | — | 534 | 710 | |||||||||||
Repayment of loans and debentures | — | — | (439 | ) | (591 | ) | |||||||||
Proceeds from issuance of common stock | 561 | 355 | 1,525 | 1,714 | |||||||||||
Incremental tax benefit from share-based compensation | 53 | 41 | 231 | 168 | |||||||||||
Repurchases and retirements of common stock | (3,321 | ) | (841 | ) | (4,610 | ) | (1,313 | ) | |||||||
Dividends paid | (592 | ) | (426 | ) | (2,055 | ) | (1,583 | ) | |||||||
Other items, net | (66 | ) | (146 | ) | (31 | ) | 138 | ||||||||
Net cash used by financing activities | (3,365 | ) | (1,017 | ) | (4,845 | ) | (757 | ) | |||||||
Changes in cash and cash equivalents held for sale | — | — | (15 | ) | — | ||||||||||
Effect of exchange rate changes on cash | 2 | 5 | (5 | ) | (19 | ) | |||||||||
Net increase (decrease) in cash and cash equivalents | 3,609 | 395 | 2,335 | (1,655 | ) | ||||||||||
Cash and cash equivalents at beginning of year | 2,533 | 3,412 | 3,807 | 5,462 | |||||||||||
Cash and cash equivalents at end of year | $ | 6,142 | $ | 3,807 | $ | 6,142 | $ | 3,807 |