Monday April 27, 10:31 PM
Qualcomm posts loss after Broadcom settlement
WASHINGTON (AFP) - US wireless technology titan Qualcomm (NASDAQ: QCOM - news) reported a second-quarter loss of 289 million dollars on Monday after agreeing to pay rival Broadcom (NASDAQ: BRCM - news) 891 million dollars to settle their patent dispute.
The San Diego, California-based Qualcomm, which posted a net profit of 766 million dollars in the same three months last year, said revenue declined six percent in the quarter to 2.46 billion dollars.
It said its second quarter results included a 748-million-dollar litigation settlement charge related to the agreement with Broadcom.
Qualcomm and Broadcom announced late Sunday that Qualcomm will pay Broadcom 891 million dollars over a four-year period in an agreement that will result in the dismissal of all litigation between the companies.
Commenting on Qualcomm's second-quarter results, company chairman and chief executive Paul Jacobs said "global demand for 3G-enabled products and services remains strong despite the current economic environment.
"Our second quarter revenues were at the high end of prior guidance, and I am pleased with the strong operating performance of our business," he added.
"The recent settlement with Broadcom will resolve all pending litigation between the parties, and while this settlement adversely impacted our second quarter results, eliminating uncertainty, employee distraction and cost related to protracted litigation is a positive."
Qualcomm is a top US producer of components for wireless telephones.
Broadcom Corporation, based in Irvine, California, is a major producer of semiconductors for wired and wireless communications. Its 2008 revenue reached 4.66 billion dollars.
Qualcomm shares gained 4.38 percent on Wall Street on Monday to close at 43.17 dollars.
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