Qualcomm in Settlement Talks With Broadcom, Postpones Q2 Financials

Qualcomm (NASDAQ: [[ticker:QCOM]]) said today it is in advanced IP settlement discussions with rival chipmaker Broadcom of Irvine, CA, and the San Diego wireless giant postponed the release of its second-quarter financial results that was scheduled today.

“Hopefully, this is a good thing,” says James Brehm, an information and communications technologies analyst with Frost & Sullivan near San Antonio, TX. “I think they want to put as much water under the bridge as possible on this one.”

Meanwhile, Broadcom (NASDAQ: [[ticker:BRCM]]) has been busy on several fronts. In addition to negotiating its IP case with Qualcomm, the Irvine company disclosed yesterday it’s making an unsolicited $764 million bid for Emulex Corp. (NYSE: [[ticker: ELX]]), a networking specialist in nearby Costa Mesa, CA. That news eclipsed the release of Broadcom’s first-quarter financial results as scheduled yesterday. The company posted a first-quarter loss of $91.9 million on sales of $853.4 million.

The two Southern California chipmakers have been locked in a wide-ranging patent dispute taking place in federal courtrooms in San Diego and Orange Counties, and the quasi-judicial International Trade Commission. Qualcomm says a global settlement of all its disputes with Broadcom—if an agreement can be reached—would have an impact on its financial results. The company rescheduled its second quarter earnings call to Monday.

Excluding the potential financial impact of a settlement with Broadcom, Qualcomm says in its statement that the company’s second-quarter revenue and operating income met or exceeded prior guidance. Qualcomm added that it remains in its quiet period and that its investor relations representatives will not be available until after Monday’s conference call.

Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.