Qualcomm ships record number of chips in Q4

Qualcomm (NASDAQ:QCOM) reported record chipset shipments in its fiscal fourth quarter, and said it would maintain its strong outlook. However, the company is still grappling with how to handle the implosion of its FLO TV business.

The chipset powerhouse said net income rose 8 percent to $865 million, which is up 13 percent from the $767 million it raked in during the fiscal third quarter. Qualcomm's total revenues clocked in at $2.95 billion, up 10 percent from the year-ago period and up 9 percent from the fiscal third quarter.

The company shipped a record 111 million CDMA-based MSM chipsets in the quarter, up 22 percent from the year-ago quarter. Qualcomm CEO Paul Jacobs said the outlook for the company is rosy. "In the coming year, we expect continued healthy growth in CDMA-based device shipments including smartphones and other data-centric devices driven by the global adoption of 3G and accelerating consumer demand for wireless data," he said during the company's earnings conference call, according to a Seeking Alpha transcript. The firm expects revenue of between $3.05 billion and $3.35 billion in its fiscal first quarter.

However, the company did have to address one of the smudges on its performance: the FLO TV unit, which Qualcomm said last month it plans to shutter. Qualcomm said it expects to incur restructuring charges between $125 million and $175 million in fiscal 2011 due to FLO TV. The company said it continues to evaluate several options for the business, including operating the FLO TV network as a new wholesale service, selling it or joining in a venture with a third party, or selling the spectrum licenses for the network.

Separately, Qualcomm purchased LTE chip house Sandbridge Technologies, according to a report from Forward Concepts analyst Will Strauss. Strauss said Qualcomm did not announce the deal, which he said is rumored to be around $55 million, because it does not represent a material change to Qualcomm's finances.

A Qualcomm spokeswoman declined to comment on the report.

Sandbridge, which was founded in 2001, designed a multi-core processor that can be used for LTE baseband technology. However, Strauss said Sandbridge failed to get a major design win, so the deal is primarily for patents and intellectual property.

The deal is notable in light of Intel's recent acquisition of Infineon's wireless unit. Infineon recently purchased Blue Wonder Communications, a German LTE specialist. Infineon and Blue Wonder have been working together for the past 18 months on developing LTE baseband solutions.

For more:
- see this release
- see this WSJ article (sub. req.)
- see this Seeking Alpha transcript
- see this FierceWireless Q3 earnings page

Related Articles:
Qualcomm beats expectations for Q3, hikes forecast
Seybold's Take: Qualcomm should wholesale its MediaFLO network
Rumor Mill: Qualcomm snaps up LTE modem designer Sandbridge
LTE chip makers take aim at Qualcomm
Qualcomm envisions chips that support multiple wireless technologies
Intel scoops up Infineon's wireless chip biz for $1.4B

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