FORM 10-Q [Risk Factors Summary](index=4&type=section&id=Risk%20Factors%20Summary) This section provides a high-level overview of QUALCOMM Incorporated's business risks, encompassing operational, strategic, supply chain, cybersecurity, human capital, licensing, regulatory, industry, product, intellectual property, and general economic factors - The business faces numerous risks and uncertainties, detailed further in 'Part I, Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations'[7](index=7&type=chunk) - Key risk categories include operating businesses, new initiatives, supply and manufacturing, cybersecurity, human capital, licensing, regulatory, industry competition, product defects, intellectual property, and general economic factors[8](index=8&type=chunk)[9](index=9&type=chunk)[10](index=10&type=chunk)[11](index=11&type=chunk)[12](index=12&type=chunk)[13](index=13&type=chunk)[14](index=14&type=chunk)[15](index=15&type=chunk)[16](index=16&type=chunk)[17](index=17&type=chunk) [PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive income, cash flows, and stockholders' equity, alongside management's discussion and analysis, market risk disclosures, and controls [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive income, cash flows, and stockholders' equity, along with detailed notes [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's financial position, detailing assets, liabilities, and equity at specific reporting dates Condensed Consolidated Balance Sheet Highlights (June 23, 2024 vs. September 24, 2023) | Metric | June 23, 2024 (Millions) | September 24, 2023 (Millions) | | :--------------------------- | :----------------------- | :-------------------------- | | Total Assets | $52,741 | $51,040 | | Total Liabilities | $28,071 | $29,459 | | Total Stockholders' Equity | $24,670 | $21,581 | | Cash and cash equivalents | $7,770 | $8,450 | | Marketable securities | $5,262 | $2,874 | | Inventories | $6,020 | $6,422 | | Long-term debt | $13,190 | $14,484 | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section presents the company's financial performance over specific periods, detailing revenues, costs, expenses, and net income Condensed Consolidated Statements of Operations (Three Months Ended) | Metric | June 23, 2024 (Millions) | June 25, 2023 (Millions) | Change (Millions) | YoY Change (%) | | :------------------------------------ | :----------------------- | :----------------------- | :---------------- | :------------- | | Total Revenues | $9,393 | $8,451 | +$942 | +11.1% | | Equipment and services revenue | $7,993 | $7,108 | +$885 | +12.4% | | Licensing revenue | $1,400 | $1,343 | +$57 | +4.2% | | Total Costs and Expenses | $7,172 | $6,628 | +$544 | +8.2% | | Operating Income | $2,221 | $1,823 | +$398 | +21.8% | | Net Income | $2,129 | $1,803 | +$326 | +18.1% | | Basic EPS (Net Income) | $1.91 | $1.62 | +$0.29 | +17.9% | | Diluted EPS (Net Income) | $1.88 | $1.60 | +$0.28 | +17.5% | Condensed Consolidated Statements of Operations (Nine Months Ended) | Metric | June 23, 2024 (Millions) | June 25, 2023 (Millions) | Change (Millions) | YoY Change (%) | | :------------------------------------ | :----------------------- | :----------------------- | :---------------- | :------------- | | Total Revenues | $28,718 | $27,189 | +$1,529 | +5.6% | | Equipment and services revenue | $24,259 | $22,737 | +$1,522 | +6.7% | | Licensing revenue | $4,459 | $4,452 | +$7 | +0.2% | | Total Costs and Expenses | $21,229 | $20,811 | +$418 | +2.0% | | Operating Income | $7,489 | $6,378 | +$1,111 | +17.4% | | Net Income | $7,222 | $5,742 | +$1,480 | +25.8% | | Basic EPS (Net Income) | $6.47 | $5.14 | +$1.33 | +25.9% | | Diluted EPS (Net Income) | $6.39 | $5.10 | +$1.29 | +25.3% | [Condensed Consolidated Statements of Comprehensive Income](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) This section presents the company's comprehensive income, including net income and other comprehensive income or loss components Condensed Consolidated Statements of Comprehensive Income (Three Months Ended) | Metric | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :--------------------------------- | :----------------------- | :----------------------- | | Net income | $2,129 | $1,803 | | Total other comprehensive (loss) income | $(41) | $12 | | Comprehensive income | $2,088 | $1,815 | Condensed Consolidated Statements of Comprehensive Income (Nine Months Ended) | Metric | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :--------------------------------- | :----------------------- | :----------------------- | | Net income | $7,222 | $5,742 | | Total other comprehensive income | $39 | $452 | | Comprehensive income | $7,261 | $6,194 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents the company's cash inflows and outflows from operating, investing, and financing activities over specific periods Condensed Consolidated Statements of Cash Flows (Nine Months Ended) | Activity | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :--------------------------------------- | :----------------------- | :----------------------- | | Net cash provided by operating activities | $9,555 | $7,209 | | Net cash (used) provided by investing activities | $(3,238) | $1,380 | | Net cash used by financing activities | $(7,070) | $(5,546) | | Net (decrease) increase in total cash and cash equivalents | $(757) | $3,078 | - Net cash provided by operating activities increased by **$2.346 billion**, primarily driven by an increase in accounts payable, accrued customer incentives, and a decrease in inventory, partially offset by severance payments[96](index=96&type=chunk)[98](index=98&type=chunk) - Net cash used by investing activities increased by **$4.618 billion**, primarily due to increased purchases of debt and equity marketable securities[29](index=29&type=chunk)[96](index=96&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) This section details changes in the company's stockholders' equity, including net income, stock repurchases, and dividends Condensed Consolidated Statements of Stockholders' Equity (Nine Months Ended) | Metric | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :------------------------------------ | :----------------------- | :----------------------- | | Total stockholders' equity, beginning balance | $21,581 | $18,013 | | Net income | $7,222 | $5,742 | | Repurchases and retirements of common stock | $(859) | $(755) | | Dividends | $(2,823) | $(2,664) | | Total stockholders' equity, ending balance | $24,670 | $20,670 | - Dividends per share announced for the three months ended June 23, 2024, were **$0.85**, up from **$0.80** in the prior year[31](index=31&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the condensed consolidated financial statements [Note 1. Basis of Presentation and Significant Accounting Policies Update](index=12&type=section&id=Note%201.%20Basis%20of%20Presentation%20and%20Significant%20Accounting%20Policies%20Update) This note outlines the basis of financial statement presentation and updates to significant accounting policies - The company operates on a 52-53 week fiscal year, with fiscal 2024 including **53 weeks** and a **14-week** fiscal fourth quarter[34](index=34&type=chunk) - New FASB requirements for segment reporting disclosures will be adopted in fiscal 2025, and income tax disclosures in fiscal 2026, both on a retrospective basis[35](index=35&type=chunk) [Note 2. Composition of Certain Financial Statement Items](index=12&type=section&id=Note%202.%20Composition%20of%20Certain%20Financial%20Statement%20Items) This note details the composition of specific financial statement line items, including revenue streams and customer concentrations QCT Revenue Streams (Three Months Ended) | Revenue Stream | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :------------- | :----------------------- | :----------------------- | | Handsets | $5,899 | $5,255 | | Automotive | $811 | $434 | | IoT | $1,359 | $1,485 | | Total QCT revenues | $8,069 | $7,174 | Customer/Licensee Concentration (Percentage of Total Revenues) | Customer/Licensee | Three Months Ended June 23, 2024 | Nine Months Ended June 23, 2024 | | :---------------- | :------------------------------- | :------------------------------ | | Customer/licensee (x) | 18% | 20% | | Customer/licensee (y) | 17% | 20% | | Customer/licensee (z) | 11% | 13% | - Other expenses in the third quarter and first nine months of fiscal 2024 primarily consisted of a **$75 million** charge related to the proposed settlement of a securities class action lawsuit[42](index=42&type=chunk)[79](index=79&type=chunk) [Note 3. Income Taxes](index=14&type=section&id=Note%203.%20Income%20Taxes) This note provides information on the company's income tax expense, effective tax rates, and significant tax-related items - The estimated annual effective income tax rate for fiscal 2024 is **7%**, lower than the U.S. federal statutory rate, primarily due to foreign-derived intangible income (FDII) benefits and federal research and development tax credits[44](index=44&type=chunk) Effective Tax Rates | Period | Effective Tax Rate | | :--------------------------------- | :----------------- | | Three Months Ended June 23, 2024 | 8% | | Three Months Ended June 25, 2023 | 1% | | Nine Months Ended June 23, 2024 | 7% | | Nine Months Ended June 25, 2023 | 5% | - The company expects to recognize a tax benefit of approximately **$400 million** in the fourth quarter of fiscal 2024 from an intra-group transfer of intellectual property[83](index=83&type=chunk) [Note 4. Capital Stock](index=14&type=section&id=Note%204.%20Capital%20Stock) This note details information regarding the company's capital stock, including repurchase programs and outstanding shares - A **$10.0 billion** stock repurchase program is in place, with **$2.3 billion** remaining authorized at June 23, 2024[45](index=45&type=chunk) - Shares of common stock outstanding increased to **1,116 million** at June 23, 2024, from **1,114 million** at September 24, 2023[46](index=46&type=chunk) - A cash dividend of **$0.85** per share was announced on July 17, 2024, payable on September 26, 2024[46](index=46&type=chunk) [Note 5. Commitments and Contingencies](index=15&type=section&id=Note%205.%20Commitments%20and%20Contingencies) This note outlines the company's significant commitments and contingent liabilities, including legal proceedings and settlements - A proposed settlement of **$75 million** was recorded in Q3 FY24 for a consolidated securities class action lawsuit, subject to final court approval[49](index=49&type=chunk) - Ongoing consumer class action lawsuits are being defended in the U.S., Canada, Israel, and the United Kingdom, alleging antitrust and unfair competition violations[49](index=49&type=chunk)[51](index=51&type=chunk) - The company is involved in an intellectual property dispute with Arm Ltd., with a trial scheduled for December 16, 2024, regarding alleged breach of license agreements and trademark infringement[51](index=51&type=chunk) [Note 6. Segment Information](index=17&type=section&id=Note%206.%20Segment%20Information) This note provides financial data and descriptions for the company's operating segments: QCT, QTL, and QSI Segment Revenues (Three Months Ended) | Segment | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :---------------- | :----------------------- | :----------------------- | | QCT | $8,069 | $7,174 | | QTL | $1,273 | $1,230 | | QSI | $2 | $9 | | Total | $9,393 | $8,451 | Segment EBT (Three Months Ended) | Segment | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :---------------- | :----------------------- | :----------------------- | | QCT | $2,181 | $1,744 | | QTL | $894 | $811 | | QSI | $14 | $(21) | | Total | $2,279 | $1,757 | - QCT (Qualcomm CDMA Technologies) develops and supplies integrated circuits and system software for mobile, automotive, and IoT; QTL (Qualcomm Technology Licensing) grants licenses for intellectual property; QSI (Qualcomm Strategic Initiatives) makes strategic investments[53](index=53&type=chunk) [Note 7. Fair Value Measurements and Marketable Securities](index=18&type=section&id=Note%207.%20Fair%20Value%20Measurements%20and%20Marketable%20Securities) This note details the fair value measurements of financial instruments and the composition of marketable securities - Total assets measured at fair value amounted to **$12,567 million** as of June 23, 2024[58](index=58&type=chunk) Composition of Marketable Securities (June 23, 2024) | Asset Type | Fair Value (Millions) | | :---------------------------------- | :-------------------- | | Corporate bonds and notes | $4,292 | | U.S. Treasury securities and government-related securities | $358 | | Mortgage- and asset-backed securities | $475 | | Equity securities | $137 | | Total marketable securities | $5,262 | Contractual Maturities of Available-for-Sale Debt Securities (June 23, 2024) | Years to Maturity | Amount (Millions) | | :---------------- | :---------------- | | Less than one year | $1,726 | | One to five years | $2,913 | | Five to ten years | $11 | | No single maturity date | $475 | | Total | $5,125 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition, results of operations, and future outlook [Third Quarter Fiscal 2024 Overview](index=20&type=section&id=Third%20Quarter%20Fiscal%202024%20Overview) This section provides a high-level summary of the company's financial performance for the third quarter of fiscal 2024 - Total revenues for Q3 FY24 were **$9.4 billion**, an **11% increase** year-over-year, with net income of **$2.1 billion**, up **18%**[66](index=66&type=chunk) - QCT revenues increased by **12%** due to higher handsets and automotive revenues, partially offset by lower IoT revenues[66](index=66&type=chunk) - QTL revenues increased by **3%** due to an increase in estimated sales of 3G/4G/5G-based multimode products[66](index=66&type=chunk) [Our Business and Operating Segments](index=20&type=section&id=Our%20Business%20and%20Operating%20Segments) This section describes Qualcomm's core business, operating segments, and factors influencing revenue fluctuations - Qualcomm's business focuses on developing and commercializing foundational technologies for mobile and wireless products, with revenues primarily from integrated circuit sales (QCT) and intellectual property licensing (QTL)[67](index=67&type=chunk) - The company's reportable segments are QCT (semiconductor business), QTL (licensing business), and QSI (strategic investments), with nonreportable segments including QGOV and cloud computing processing initiative[67](index=67&type=chunk) - Revenues are subject to seasonality and fluctuations based on consumer demand for devices and the timing of customer/licensee device launches and innovation cycles[69](index=69&type=chunk) [Results of Operations](index=21&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance, detailing revenues, costs, expenses, and profitability metrics [Revenues](index=21&type=section&id=Revenues) This section provides a detailed breakdown and analysis of the company's total revenues by segment and type Total Revenues (Three Months Ended) | Metric | June 23, 2024 (Millions) | June 25, 2023 (Millions) | Change (Millions) | YoY Change (%) | | :----------------------- | :----------------------- | :----------------------- | :---------------- | :------------- | | Equipment and services | $7,993 | $7,108 | +$885 | +12.4% | | Licensing | $1,400 | $1,343 | +$57 | +4.2% | | Total Revenues | $9,393 | $8,451 | +$942 | +11.1% | Total Revenues (Nine Months Ended) | Metric | June 23, 2024 (Millions) | June 25, 2023 (Millions) | Change (Millions) | YoY Change (%) | | :----------------------- | :----------------------- | :----------------------- | :---------------- | :------------- | | Equipment and services | $24,259 | $22,737 | +$1,522 | +6.7% | | Licensing | $4,459 | $4,452 | +$7 | +0.2% | | Total Revenues | $28,718 | $27,189 | +$1,529 | +5.6% | - The increase in revenues for both periods was primarily driven by higher equipment and services revenues from the QCT segment[71](index=71&type=chunk) [Costs and Expenses](index=21&type=section&id=Costs%20and%20Expenses) This section analyzes the company's cost of revenues and gross margin performance over the reporting periods Cost of Revenues and Gross Margin | Metric | Three Months Ended June 23, 2024 (Millions) | Three Months Ended June 25, 2023 (Millions) | Nine Months Ended June 23, 2024 (Millions) | Nine Months Ended June 25, 2023 (Millions) | | :--------------- | :---------------------------------------- | :---------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Cost of revenues | $4,174 | $3,792 | $12,593 | $11,989 | | Gross margin | 56% | 55% | 56% | 56% | - Gross margin percentage increased in Q3 FY24 primarily due to an increase in QCT gross margin[73](index=73&type=chunk) [Research and Development](index=21&type=section&id=Research%20and%20Development) This section details the company's research and development expenses and their impact on financial results Research and Development Expenses | Metric | Three Months Ended June 23, 2024 (Millions) | Three Months Ended June 25, 2023 (Millions) | Nine Months Ended June 23, 2024 (Millions) | Nine Months Ended June 25, 2023 (Millions) | | :--------------- | :---------------------------------------- | :---------------------------------------- | :--------------------------------------- | :--------------------------------------- | | R&D Expenses | $2,259 | $2,222 | $6,591 | $6,683 | | % of revenues | 24% | 26% | 23% | 25% | - The decrease in R&D expenses for the first nine months of fiscal 2024 was primarily due to a **$174 million** decrease in employee-related costs from fiscal 2023 restructuring actions, partially offset by a **$49 million** increase in share-based compensation expense[75](index=75&type=chunk) [Selling, General and Administrative](index=22&type=section&id=Selling%2C%20General%20and%20Administrative) This section analyzes the company's selling, general, and administrative expenses and their drivers Selling, General and Administrative Expenses | Metric | Three Months Ended June 23, 2024 (Millions) | Three Months Ended June 25, 2023 (Millions) | Nine Months Ended June 23, 2024 (Millions) | Nine Months Ended June 25, 2023 (Millions) | | :--------------- | :---------------------------------------- | :---------------------------------------- | :--------------------------------------- | :--------------------------------------- | | SG&A Expenses | $664 | $618 | $1,998 | $1,854 | | % of revenues | 7% | 7% | 7% | 7% | - The increase in SG&A expenses for the first nine months of fiscal 2024 was primarily due to a **$34 million** increase in sales and marketing expenses, a **$29 million** increase in litigation costs, and a **$22 million** increase from the revaluation of deferred compensation obligation[78](index=78&type=chunk) [Other Expenses (Income)](index=22&type=section&id=Other%20Expenses%20%28Income%29) This section details other non-operating expenses or income, including significant one-time charges Other Expenses (Income) | Period | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :--------------------------------- | :----------------------- | :----------------------- | | Three Months Ended | $75 | $(4) | | Nine Months Ended | $47 | $285 | - Other expenses in Q3 and 9M FY24 primarily consisted of a **$75 million** charge related to the proposed settlement of a securities class action lawsuit[79](index=79&type=chunk) [Interest Expense and Investment and Other Income, Net](index=22&type=section&id=Interest%20Expense%20and%20Investment%20and%20Other%20Income%2C%20Net) This section analyzes interest expense and net investment and other income, highlighting key drivers of changes Investment and Other Income, Net | Metric | Three Months Ended June 23, 2024 (Millions) | Three Months Ended June 25, 2023 (Millions) | Nine Months Ended June 23, 2024 (Millions) | Nine Months Ended June 25, 2023 (Millions) | | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Interest expense | $(168) | $(172) | $(517) | $(521) | | Investment and other income, net | $226 | $106 | $768 | $166 | - The increase in investment and other income, net, was primarily due to higher interest rates earned on increased balances of interest-bearing securities and net gains on certain QSI non-marketable equity investments[80](index=80&type=chunk) [Income Tax Expense](index=23&type=section&id=Income%20Tax%20Expense) This section details the company's income tax expense and effective tax rates, explaining key influencing factors Income Tax Expense and Effective Tax Rate | Period | Income Tax Expense (Millions) | Effective Tax Rate | | :--------------------------------- | :---------------------------- | :----------------- | | Three Months Ended June 23, 2024 | $171 | 8% | | Three Months Ended June 25, 2023 | $22 | 1% | | Nine Months Ended June 23, 2024 | $545 | 7% | | Nine Months Ended June 25, 2023 | $313 | 5% | - The effective tax rate is lower than the U.S. federal statutory rate primarily due to benefits from foreign-derived intangible income (FDII) deduction and federal research and development tax credit[83](index=83&type=chunk) [Discontinued Operations](index=23&type=section&id=Discontinued%20Operations) This section reports the financial results from discontinued operations, net of income taxes Discontinued Operations, Net of Income Taxes | Period | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :--------------------------------- | :----------------------- | :----------------------- | | Three Months Ended | $21 | $68 | | Nine Months Ended | $27 | $32 | - Discontinued operations relate to the Non-Arriver businesses (Veoneer's Active Safety and Restraint Control Systems), which were fully disposed of by March 1, 2024[43](index=43&type=chunk)[83](index=83&type=chunk) [Segment Results](index=24&type=section&id=Segment%20Results) This section provides a detailed analysis of the financial performance for each of the company's operating segments [QCT Segment](index=24&type=section&id=QCT%20Segment) This section details the revenue and EBT performance of the Qualcomm CDMA Technologies (QCT) segment QCT Segment Revenues (Three Months Ended) | Revenue Stream | June 23, 2024 (Millions) | June 25, 2023 (Millions) | Change (Millions) | YoY Change (%) | | :------------- | :----------------------- | :----------------------- | :---------------- | :------------- | | Handsets | $5,899 | $5,255 | +$644 | +12.3% | | Automotive | $811 | $434 | +$377 | +86.9% | | IoT | $1,359 | $1,485 | -$126 | -8.5% | | Total QCT revenues | $8,069 | $7,174 | +$895 | +12.5% | - QCT EBT increased by **25.1%** to **$2,181 million** for the three months ended June 23, 2024, with EBT as a percentage of revenues rising from **24%** to **27%**[85](index=85&type=chunk) - The increase in QCT revenues was driven by higher handset chipset shipments and favorable mix towards higher-tier Snapdragon platforms, as well as increased automotive demand from new vehicle launches[86](index=86&type=chunk) [QTL Segment](index=25&type=section&id=QTL%20Segment) This section details the licensing revenue and EBT performance of the Qualcomm Technology Licensing (QTL) segment QTL Segment Performance | Metric | Three Months Ended June 23, 2024 (Millions) | Three Months Ended June 25, 2023 (Millions) | Nine Months Ended June 23, 2024 (Millions) | Nine Months Ended June 25, 2023 (Millions) | | :------------------- | :---------------------------------------- | :---------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Licensing revenues | $1,273 | $1,230 | $4,051 | $4,044 | | EBT | $894 | $811 | $2,907 | $2,799 | | EBT as a % of revenues | 70% | 66% | 72% | 69% | - The increase in QTL licensing revenues for the three months was primarily due to an increase in estimated sales of 3G/4G/5G-based multimode products[89](index=89&type=chunk) - For the nine months, QTL licensing revenues increased due to higher estimated sales of 3G/4G/5G-based multimode products, partially offset by a decrease in estimated revenues per unit and the ending of Nokia upfront license fee recognition[89](index=89&type=chunk) [QSI Segment](index=25&type=section&id=QSI%20Segment) This section details the EBT performance of the Qualcomm Strategic Initiatives (QSI) segment QSI Segment Performance (Nine Months Ended) | Metric | June 23, 2024 (Millions) | June 25, 2023 (Millions) | | :----- | :----------------------- | :----------------------- | | EBT | $121 | $(83) | - QSI EBT increased significantly for the first nine months of fiscal 2024, primarily due to net gains on certain non-marketable equity investments[91](index=91&type=chunk) [Looking Forward](index=25&type=section&id=Looking%20Forward) This section outlines Qualcomm's future growth expectations, anticipated challenges, and strategic considerations - Qualcomm expects continued growth driven by 5G, high-performance processing, and on-device AI, extending into automotive and IoT[92](index=92&type=chunk) - Anticipated challenges include elevated IoT customer inventory, increased product costs from new process technology nodes, intense competition, and U.S./China trade and national security tensions[92](index=92&type=chunk)[93](index=93&type=chunk) - The U.S. Department of Commerce revoked Qualcomm's license to export 4G and certain other integrated circuit products to Huawei, effective May 7, 2024, eliminating future product revenues from Huawei[104](index=104&type=chunk) [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's cash position, cash flow activities, and capital allocation strategies Cash, Cash Equivalents and Marketable Securities | Metric | June 23, 2024 (Millions) | September 24, 2023 (Millions) | | :--------------------------------- | :----------------------- | :-------------------------- | | Cash and cash equivalents | $7,770 | $8,450 | | Marketable securities | $5,262 | $2,874 | | Total | $13,032 | $11,324 | - Net cash provided by operating activities for the first nine months of fiscal 2024 was **$9,555 million**, a significant increase from **$7,209 million** in the prior year[96](index=96&type=chunk) - The company intends to continue cash dividends and stock repurchases as part of its capital return program, subject to capital availability[98](index=98&type=chunk) [Recent Accounting Guidance](index=27&type=section&id=Recent%20Accounting%20Guidance) This section refers to Note 1 for information on recent accounting guidance and its impact - Information regarding recent accounting guidance and its impact on the condensed consolidated financial statements is provided in Note 1[99](index=99&type=chunk) [Risk Factors](index=27&type=section&id=Risk%20Factors) This section details various risks that could materially affect the company's business, financial condition, and results of operations [RISKS RELATED TO OUR OPERATING BUSINESSES](index=28&type=section&id=RISKS%20RELATED%20TO%20OUR%20OPERATING%20BUSINESSES) This section outlines risks associated with Qualcomm's core operating businesses, including customer concentration and vertical integration - A significant portion of revenues is derived from a small number of customers and licensees, particularly from premium-tier handset devices, making the business vulnerable to decreases or fluctuations in their sales[101](index=101&type=chunk) - Customers vertically integrating by developing their own integrated circuit products (e.g., Samsung, Apple, Chinese OEMs) poses a significant risk to Qualcomm's semiconductor business[101](index=101&type=chunk)[102](index=102&type=chunk)[103](index=103&type=chunk) - Concentration of business in China, exacerbated by U.S./China trade and national security tensions, could limit transactions or encourage Chinese OEMs to use domestic alternatives, negatively impacting revenues[101](index=101&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) [RISKS RELATED TO NEW INITIATIVES](index=30&type=section&id=RISKS%20RELATED%20TO%20NEW%20INITIATIVES) This section addresses risks associated with extending technologies into new areas and the challenges of acquisitions - Growth depends on extending technologies and products into new areas beyond mobile handsets, such as automotive and IoT, but these investments may not generate expected returns[105](index=105&type=chunk) - Risks include new product areas not developing as anticipated, failure to attract skilled employees, and competitors offering more cost-effective or advanced solutions[106](index=106&type=chunk) - Acquisitions and strategic transactions, while important for growth, carry risks of integration challenges, failure to achieve anticipated synergies, and potential impairment charges[107](index=107&type=chunk) [RISKS RELATED TO SUPPLY AND MANUFACTURING](index=32&type=section&id=RISKS%20RELATED%20TO%20SUPPLY%20AND%20MANUFACTURING) This section details risks stemming from reliance on third-party suppliers and the operation of company-owned manufacturing facilities - Reliance on a limited number of third-party suppliers for manufacturing, assembly, and testing in a fabless model creates vulnerabilities to capacity constraints, raw material shortages, and geopolitical disruptions[108](index=108&type=chunk) - Risks include suppliers' inability to meet demand, failure to procure raw materials, natural disasters, health crises, cyber-attacks, and trade policies impacting supply chains[108](index=108&type=chunk)[109](index=109&type=chunk) - Company-owned manufacturing facilities face risks of higher fixed costs, underutilization, environmental compliance, and exposure to external disruptions[110](index=110&type=chunk)[111](index=111&type=chunk) [RISKS RELATED TO CYBERSECURITY OR MISAPPROPRIATION OF OUR CRITICAL INFORMATION](index=36&type=section&id=RISKS%20RELATED%20TO%20CYBERSECURITY%20OR%20MISAPPROPRIATION%20OF%20OUR%20CRITICAL%20INFORMATION) This section highlights risks from cybersecurity threats, intellectual property misappropriation, and compliance with data security laws - The company faces constant and increasingly sophisticated cybersecurity threats, including malware, ransomware, and exploitation of IT vulnerabilities, which could lead to unauthorized access and data breaches[113](index=113&type=chunk) - Misappropriation of technology, intellectual property, or confidential information by employees, former employees, or business partners poses a significant risk to competitive position and reputation[113](index=113&type=chunk) - Failure to comply with evolving cybersecurity laws and obtain necessary certifications could result in loss of revenues and damage to customer relationships[115](index=115&type=chunk) [RISKS RELATED TO HUMAN CAPITAL MANAGEMENT](index=37&type=section&id=RISKS%20RELATED%20TO%20HUMAN%20CAPITAL%20MANAGEMENT) This section addresses risks related to attracting, retaining, and motivating key personnel in a competitive talent market - The company's future success depends on its ability to attract, retain, and motivate key executive, management, and specialized technical personnel in a highly competitive market[117](index=117&type=chunk) - Competition for talent, particularly engineering talent, is intense, with competitors offering aggressive compensation and flexible work arrangements, potentially impacting Qualcomm's ability to maintain its workforce[117](index=117&type=chunk) [RISKS SPECIFIC TO OUR LICENSING BUSINESS](index=37&type=section&id=RISKS%20SPECIFIC%20TO%20OUR%20LICENSING%20BUSINESS) This section details risks unique to the company's licensing business, including patent portfolio evolution and royalty disputes - The continued success of licensing programs requires evolving the patent portfolio, especially in 5G, and successfully renewing or renegotiating expiring license agreements[118](index=118&type=chunk) - OEMs' efforts to avoid paying fair royalties, including litigation and appeals to governmental authorities, pose a significant threat to licensing revenues and the business model[119](index=119&type=chunk) - Challenges to standard-essential patents (SEPs) and potential changes in patent laws or regulatory schemes could devalue SEPs and negatively impact licensing revenues and the ability to enforce rights[119](index=119&type=chunk)[120](index=120&type=chunk) [RISKS RELATED TO REGULATORY AND LEGAL CHALLENGES](index=40&type=section&id=RISKS%20RELATED%20TO%20REGULATORY%20AND%20LEGAL%20CHALLENGES) This section outlines risks from ongoing governmental investigations and legal proceedings challenging patent licensing practices - Ongoing governmental investigations and legal proceedings challenging patent licensing practices could result in adverse rulings, such as injunctions, monetary damages, or forced changes to royalty rates or licensing structures[122](index=122&type=chunk) - Unfavorable resolutions could materially impact revenues, operations, and financial condition, potentially requiring significant cost cuts or affecting capital return programs[122](index=122&type=chunk) [RISKS RELATED TO INDUSTRY DYNAMICS AND COMPETITION](index=40&type=section&id=RISKS%20RELATED%20TO%20INDUSTRY%20DYNAMICS%20AND%20COMPETITION) This section addresses risks related to industry competition, rapid technological change, and market demand for Qualcomm's technologies - Revenues depend on customer and licensee sales of products and services based on CDMA, OFDMA, and 5G technologies, and demand for Qualcomm's products based on these technologies[123](index=123&type=chunk) - The industry is intensely competitive, characterized by rapid technological change, vertical integration by customers, and geopolitical influences, which could lead to decreased demand and declining average selling prices[125](index=125&type=chunk) - Success hinges on the ability to differentiate products, offer competitive pricing, lead in 5G technology, drive adoption in new industries (automotive, IoT), and maintain supply chain access[125](index=125&type=chunk) [RISKS RELATED TO PRODUCT DEFECTS OR SECURITY VULNERABILITIES](index=43&type=section&id=RISKS%20RELATED%20TO%20PRODUCT%20DEFECTS%20OR%20SECURITY%20VULNERABILITIES) This section details risks associated with product defects, security vulnerabilities, and potential product liability claims - Complex products are susceptible to defects, errors, or security vulnerabilities from design, fabrication, or cyber-attacks, which may only be detected during use[127](index=127&type=chunk) - Failures in products, especially in critical applications like automotive, could lead to substantial costs for remediation, recalls, and indemnification, as well as loss of sales and reputational damage[127](index=127&type=chunk)[128](index=128&type=chunk) - Product liability claims, particularly if defects result in personal injury or death, could incur significant costs and expenses, potentially exceeding insurance coverage[128](index=128&type=chunk) [RISKS RELATED TO INTELLECTUAL PROPERTY](index=44&type=section&id=RISKS%20RELATED%20TO%20INTELLECTUAL%20PROPERTY) This section outlines risks concerning intellectual property protection, enforcement, and the use of open-source software - Reliance on patent, copyright, trademark, and trade secret laws for IP protection faces challenges from misappropriation, adverse changes in patent laws, and ineffective enforcement in foreign jurisdictions[129](index=129&type=chunk) - Litigation to enforce IP rights or defend against infringement claims can be costly and time-consuming, potentially leading to loss of patent enforceability or unfavorable license terms[130](index=130&type=chunk)[131](index=131&type=chunk) - The use of open source software may expose source code, impose adverse licensing conditions, or complicate IP protection efforts[133](index=133&type=chunk) [GENERAL RISK FACTORS](index=46&type=section&id=GENERAL%20RISK%20FACTORS) This section covers broad risks including industry cyclicality, geopolitical events, regulatory compliance, debt, and tax liabilities - Operating in the highly cyclical semiconductor industry and susceptibility to global economic downturns can lead to significant fluctuations in stock price and financial results[134](index=134&type=chunk) - Geopolitical conflicts (e.g., China-Taiwan tensions), natural disasters, and health crises, particularly in regions with concentrated operations, could severely disrupt business, supply chains, and demand[136](index=136&type=chunk) - The business is subject to various complex and evolving laws, regulations, policies, and standards globally, with failure to comply or adverse changes potentially impacting operations and financial results[137](index=137&type=chunk)[138](index=138&type=chunk) - Risks associated with outstanding debt include reduced cash availability for other purposes and limitations on future financing or business flexibility[139](index=139&type=chunk) - Tax liabilities are subject to significant judgment and potential changes in tax laws (e.g., FDII rate increase, R&D capitalization changes, BEPS project) could adversely affect results of operations and cash flows[140](index=140&type=chunk)[142](index=142&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=49&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section addresses the company's exposure to financial market risks, including interest rates, foreign currency, and equity prices - There have been no material changes to the financial market risks related to interest rates, foreign currency exchange rates, and equity prices as described in the 2023 Annual Report on Form 10-K[143](index=143&type=chunk) [Item 4. Controls and Procedures](index=49&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures and reports on internal control changes - Management concluded that the company's disclosure controls and procedures were effective as of June 23, 2024[144](index=144&type=chunk) - There were no material changes in internal control over financial reporting during the third quarter of fiscal 2024[144](index=144&type=chunk) [PART II. OTHER INFORMATION](index=50&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section provides additional information, including legal proceedings, updated risk factors, unregistered equity sales, use of proceeds, and executive trading arrangements [Item 1. Legal Proceedings](index=50&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 5 for details on the company's legal proceedings and related contingencies - Information regarding certain legal proceedings is provided in Note 5 to the Condensed Consolidated Financial Statements[146](index=146&type=chunk) [Item 1A. Risk Factors](index=50&type=section&id=Item%201A.%20Risk%20Factors) This section refers to updated risk factors detailed in Management's Discussion and Analysis - Updated Risk Factors are provided in 'Part I, Item 2, Management's Discussion and Analysis of Financial Condition and Results of Operations'[147](index=147&type=chunk) - The company believes these updates have not materially changed the type or magnitude of risks compared to the 2023 Annual Report on Form 10-K[147](index=147&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=50&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details issuer purchases of equity securities and the remaining authorization under the stock repurchase program Issuer Purchases of Equity Securities (Q3 FY24) | Period | Total Number of Shares Purchased (Thousands) | Average Price Paid Per Share | | :--------------------------------- | :--------------------------------------- | :--------------------------- | | March 25, 2024 to April 21, 2024 | 1,332 | $170.75 | | April 22, 2024 to May 19, 2024 | 1,855 | $176.61 | | May 20, 2024 to June 23, 2024 | 3,642 | $205.52 | | Total | 6,829 | | - Approximately **$2.329 billion** remained authorized for repurchase under the **$10.0 billion** stock repurchase program as of June 23, 2024[149](index=149&type=chunk) [Item 3. Defaults Upon Senior Securities](index=50&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section indicates that there are no applicable defaults upon senior securities - Not applicable[150](index=150&type=chunk) [Item 4. Mine Safety Disclosures](index=50&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section indicates that there are no applicable mine safety disclosures - Not applicable[150](index=150&type=chunk) [Item 5. Other Information](index=50&type=section&id=Item%205.%20Other%20Information) This section discloses executive trading arrangements under Rule 10b5-1 - Cristiano Amon (CEO), Ann Chaplin (General Counsel), and Neil Martin (SVP, Finance & CAO) adopted Rule 10b5-1 trading arrangements for the sale of common stock and vested share-based awards[151](index=151&type=chunk) [Item 6. Exhibits](index=51&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the report, including organizational documents and certifications - The exhibits include organizational documents, incentive plan agreements, certifications under Sarbanes-Oxley Act (Sections 302 and 906) for the CEO and CFO, and XBRL interactive data files[152](index=152&type=chunk) [SIGNATURES](index=52&type=section&id=SIGNATURES) The report is signed by Akash Palkhiwala, Chief Financial Officer and Chief Operating Officer, on behalf of QUALCOMM Incorporated on July 31, 2024 - The report was signed by Akash Palkhiwala, Chief Financial Officer and Chief Operating Officer, on July 31, 2024[154](index=154&type=chunk)

Exhibit 99.1 FOR IMMEDIATE RELEASE Qualcomm Contact: Mauricio Lopez-Hodoyan Vice President, Investor Relations Phone: 1-858-658-4813 | e-mail: ir@qualcomm.com Qualcomm Announces Third Quarter Fiscal 2024 Results Revenues: $9.4 billion GAAP EPS: $1.88, Non-GAAP EPS: $2.33 —Greater Than 20% Year-Over-Year Growth in EBT— —QCT Automotive: 87% Year-Over-Year Growth in Revenues— SAN DIEGO - July 31, 2024 - Qualcomm Incorporated (NASDAQ: QCOM) today announced results for its fiscal third quarter ended June 23, 202 ...

Qualcomm Incorporated (QCOM) is scheduled to report third-quarter fiscal 2024 earnings on Jul 31. The Zacks Consensus Estimate for revenues and earnings is pegged at $9.19 billion and $2.25 per share, respectively. Earnings estimates for QCOM have improved from $9.58 per share to $9.89 for 2024 and from $10.48 per share to $10.96 for 2025 over the past 90 days.QCOM Estimate TrendImage Source: Zacks Investment ResearchEarnings Surprise HistoryThe chip manufacturer delivered a four-quarter earnings surprise o ...

Investors looking to benefit from the growing adoption of AI smartphones should consider buying this chip stock while it is still cheap.Shares of Qualcomm (QCOM 2.66%) have enjoyed healthy gains of over 20% year to date, despite dropping 20% from the 52-week high it hit on June 18.However, there is a good chance this semiconductor stock could come out of this slump when it releases its fiscal 2024 third-quarter results on July 31. Let's see why that may be the case.Improving smartphone demand could help Qua ...

Qualcomm Inc‘s QCOM shares dropped 13% in just a month; this presents an excellent entry point for investors looking to capitalize on a promising upswing driven by artificial intelligence adoption.That’s according to to JPMorgan analyst Samik Chatterjee, who revised the price target upwards to $235 for December 2025 — a potential 34% upside. The “share price pull-back offers entry point,” Chatterjee noted."We see double-digit revenue growth consistently in the medium-term," he added. Qualcomm’s strategic fo ...

Wall Street analysts forecast that Qualcomm (QCOM) will report quarterly earnings of $2.25 per share in its upcoming release, pointing to a year-over-year increase of 20.3%. It is anticipated that revenues will amount to $9.19 billion, exhibiting an increase of 8.7% compared to the year-ago quarter.The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates during this timefra ...

QUALCOMM TodayQCOMQUALCOMM$177.70 -3.37 (-1.86%) 52-Week Range$104.33▼$230.63Dividend Yield1.91%P/E Ratio23.88Price Target$199.63Add to WatchlistEquities across the board are starting to soften after months of gains, making it a good time to go bargain-hunting. Many of the stocks that have enjoyed triple-digit percentage gains this past year are also facing some of the heavier selloffs. Qualcomm Incorporated NASDAQ: QCOM, a semiconductor tech stock, for example, is in the middle of a 20% drop after a 120% r ...

An exciting segment within the equities space, augmented reality stocks center on a mainline catalyst: the prospect for tremendous growth.According to Grand View Research, the global AR market reached a valuation of $57.26 billion last year. By 2030, experts project that the segment could expand at a compound annual growth rate (CAGR) of 39.8%. If so, the ecosystem may be worth $597.54 billion at the forecast culmination point.On a fundamental level, AR platforms offer a range of applications and functional ...

Core Viewpoint - The recent pullback in the tech sector has significantly impacted Qualcomm (QCOM) stock, which has shown signs of recovery following a positive trading session and analyst upgrades predicting substantial upside potential [1][2][5]. Group 1: Stock Performance - QCOM stock fell below the $200 threshold, experiencing a 2.92% decline last month and extending losses to 7.15% over five days due to intensified sell-offs [1]. - A recent trading session saw QCOM recover with a gain of 4.70%, bringing the stock price to $194.97, with pre-market gains of 1.05% further aiding recovery [1]. Group 2: Analyst Insights - Baird analysts upgraded Qualcomm's stock price target from $200 to $250, citing positive initial channel feedback and predicting a potential 30% upside from current levels [2]. - Tigress Financial Partners analyst Ivan Feinseth raised the 12-month target price for Qualcomm to $270, reflecting the company's advantages in AI capabilities and communication technologies [5]. Group 3: Market Demand and Product Development - The procurement estimate for the iPhone 16 has increased to over 90 million units, driven by AI, which is expected to contribute to double-digit increases in average selling prices (ASPs) for Qualcomm's handsets [2]. - Qualcomm is anticipated to benefit from AI integration in high-end Chinese phones and the next-gen Galaxy platform, with rising ASPs and RF component content expected [3]. Group 4: Business Growth and Financial Health - Qualcomm's business is expanding rapidly, driven by revenue from Snapdragon-powered devices, record automotive sales, and opportunities for on-device AI integration [6]. - The company reported a 6.25% dividend increase to $0.85 per share and $1.6 billion in shareholder returns last quarter, including $731 million in stock repurchases, indicating strong financial health [6].

I love Qualcomm (NASDAQ:QCOM). Based in San Diego, Qualcomm develops and commercializes a range of foundational technologies for the wireless industry. With mobile connectivity becoming an increasingly vital concept, the company’s specialized semiconductor products command tremendous prominence. However, as great as Qualcomm stock is, the market is the ultimate arbiter.Right now, the market is saying it’s not comfortable with QCOM’s premium to growth. Last Friday, Qualcomm stock suffered a loss of nearly 3% ...