Tags: China | Qualcomm | Fine | Monopoly

Qualcomm to Pay $975 Million Fine over Chinese Anti-monopoly Claim

Monday, 09 Feb 2015 08:02 PM

Qualcomm has agreed to pay $975 million to China after the government found that the chipmaker violated that country's anti-monopoly laws.

China is the world's biggest manufacturer of mobile phones and other wireless devices. Its government has complained about the high cost of licenses for foreign technology.

Last year, the Chinese government stepped up its scrutiny of foreign companies to assess whether they were in violation of its 2008 anti-monopoly law.

Chinese regulators launched such a probe into Qualcomm, one of the biggest makers of chips used in mobile devices, to find out whether it abused its dominant market position by charging excessive fees for technology.

San Diego-based Qualcomm said it is disappointed with the findings by China's National Development and Reform Commission, but will not contest the matter.

In addition to the fine, Qualcomm said Monday that it agreed to make several changes to its licensing practices in China.

Among the changes, the company will offer licenses to its current 3G and 4G Chinese patents separately from licenses to its other patents. It also will give existing licensees in China an opportunity to adopt the new terms for sales of branded devices for use in China going back to Jan. 1.

The company said Monday that the fine will reduce its earnings for the fiscal year ending Sept. 27.

Qualcomm Inc. now forecasts earnings per share between $3.56 and $3.76, down from its previous estimate of $4.04 to $4.34.

But it raised the lower end of its revenue guidance to a range of $26.3 billion to $28 billion. Previously, it had set the lower end at $26 billion.

Its adjusted earnings — which exclude charges related to the settlement — are now expected to range from $4.85 to $5.05 per share, up from its prior range of $4.75 to $5.05 per share.

On that basis, analysts surveyed by FactSet expect Qualcomm to earn $4.97 per share on revenue of $27.2 billion.

Qualcomm's stock added $1.93, or almost 3 percent, to $69.04 in after-hours trading. It had ended regular trading up 76 cents to $67.11.

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Qualcomm has agreed to pay $975 million to China after the government found that the chipmaker violated that country's anti-monopoly laws.
China, Qualcomm, Fine, Monopoly
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2015-02-09
Monday, 09 Feb 2015 08:02 PM
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