Qualcomm, Broadcom may be near settlement

Qualcomm postponed its earnings call because a settlement could affect the results

Instead of issuing its second-quarter earnings report on Wednesday, Qualcomm abruptly rescheduled it, citing advanced settlement discussions with rival Broadcom.

For several years, the two chip makers have been embroiled in acrimonious patent battles.

The settlement would cover all disputes between the companies and, if completed, would have an impact on Qualcomm's financial results, the company said in a statement. Qualcomm warned that there are no assurances the companies will come to an agreement.

Not counting the potential impact of such an agreement, revenue and operating income for the second quarter met or exceeded earlier guidance, Qualcomm said. It will release earnings and host a conference call about financial results on Monday.

While the announcement was issued by Qualcomm, it said that neither company would comment further.

It's hard to predict which company might emerge the winner in a settlement, said Francis Sideco, an analyst at iSuppli. "One thing I'm pretty confident about is that whatever comes out, both companies are going to spin it... to make sure they come out looking like they won," he said.

The ongoing legal battle doesn't appear to have had much of an effect on Qualcomm's bottom line, but a settlement could be material in several ways, he said. Depending on the agreement, Qualcomm might receive or have to make a one-time payment.

The deal could also have bearing on products that are in the works and that could affect future contracts and outlook, Sideco said.

A settlement, regardless of the details, also should be generally good for the mobile industry, he said. "From a big-picture standpoint, having these things settled gives a feeling of stability back and allows them both to move forward with their strategies," Sideco said.

For the past couple years, it has appeared that Qualcomm has been fighting a losing battle against Broadcom. At one point, the U.S. International Trade Commission barred the importation of certain Qualcomm chips for infringing on a Broadcom patent. Then a judge ordered an ethics investigation into Qualcomm lawyers after finding that the company had intentionally withheld tens of thousands of important documents in a case involving Broadcom.

Qualcomm has also been found in contempt of an injunction preventing it from selling and supporting certain products that rely on Broadcom technology.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags legalpatentsqualcommbroadcom

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Nancy Gohring

IDG News Service
Show Comments

Cool Tech

Toys for Boys

Family Friendly

Stocking Stuffer

SmartLens - Clip on Phone Camera Lens Set of 3

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?