Qualcomm Incorporated · NASDAQ:QCOM
Qualcomm — Q1 FY2017 Earnings Presentation
25 slides from Qualcomm's earnings presentation, Jan 25, 2017
Slide 1: First Quarter Fiscal 2017 Earnings
First Quarter Fiscal 2017 Earnings January 25, 2017
Slide 2: Safe Harbor
Safe Harbor In addition to the historical information contained herein, this presentation and the conference call that accompanies it contain forward-looking statements that are inherently subject to risks and uncertainties, including but not limited to statements regarding the pending NXP acquisiti
Slide 3: Qualcomm Reports First Quarter Fiscal 2017 Earnings
Qualcomm Reports First Quarter Fiscal 2017 Earnings Quarter ended December 25, 2016 • We are pleased with the strong start to our fiscal year and the year-over-year earnings growth across both our semiconductor and licensing businesses. • Looking ahead, the pending NXP acquisition accelerates our st
Slide 4: First Quarter Fiscal 2017 Results vs. Guidance
First Quarter Fiscal 2017 Results vs. Guidance Q1’17 Q1’17 Guidance* Results Revenues $5.7B - $6.5B $6.0B Non-GAAP(1) diluted EPS(2) $1.12 - $1.22 $1.19 MSMTM chip shipments 205M - 225M 217M Total reported device sales(3) (Sep. Qtr.(4)) $58.0B - $66.0B $62.9B Est. reported 3G/4G device shipments(3)
Slide 5: Second Quarter Fiscal 2017 Guidance
Second Quarter Fiscal 2017 Guidance As of January 25, 2017 Q2’17 Guidance Revenues $5.5B - $6.3B Non-GAAP(1) combined R&D and SG&A expenses Increase 6% - 8% QoQ Non-GAAP(1) diluted EPS(2) $1.15 - $1.25 Total reported device sales(3) (Dec. Qtr.(4)) $74.0B - $82.0B* QCT operating margin % ~ 10% - 12%
Slide 6: MSM Chip Shipments
MSM Chip Shipments Calendar year, millions 919 903 818 748 270 242 217 213 203 236 211 190 225 225 201 172 188 233 189 165 – 173 185e* 2013 2014 2015 2016 2017 Quarter March June September December * Guidance as of Jan. 25, 2017. 6
Slide 7: Quarterly Total Reported Device Sales
Quarterly Total Reported Device Sales(3)(4) Reported by Qualcomm licensees 335+ CDMA-based licensees; 290+ licensed for WCDMA 220+ royalty-bearing single-mode OFDM/OFDMA licensees $74.0 – $75.8 $74.2 82.0e* $70.1 $66.5 $60.4 $60.6 $62.6 $62.9 $58.1 $57.4 $56.4 $58.3 In Billions Dec’13 Mar’14 Jun’14
Slide 8: Global 3G/4G Device Shipment Estimates
Global 3G/4G Device Shipment* Estimates Calendar year, as of January 25, 2017 ~ 1.75B - ~ 1.65B - 1.85Be 1.70Be ~ 1.55B ~ +4 - 10% ~ +6 - 10% 2015 2016 2017 * Global 3G/4G device shipments represent our estimate of CDMA-based, OFDMA-based and CDMA/OFDMA multimode subscriber devices shipped globally,
Slide 9: Supplemental Information, 3G/4G Device Estimates
Supplemental Information, 3G/4G Device Estimates* As of January 25, 2017 FY’16 CY’16 CY’17 Global ~ 1.65B - 1.70B ~ 1.75B - 1.85B 3G/4G Units Reported(3)(4) ~ 1,364M – 1,380M Global ~ $169 - $179 3G/4G ASP Reported(3)(4) ~ $192 - $198 Global ~ $278.0B - $288.0B 3G/4G Device Sales Reported(3)(4) ~ $2
Slide 10: Quarterly Estimated 3G/4G Reported Device Shipments and ASP Trend
Quarterly Estimated 3G/4G Reported Device Shipments and ASP Trend(3)(4) FY’15 FY’16 FY’17 Sep’14 Dec’14 Mar’15 Jun’15 Sep’15 Dec’15 Mar’16 Jun’16 Sep’16 Dec’16** $74.0 - Qtr. total reported device sales ($B) $56.4 $75.8 $60.4 $58.3 $60.6 $70.1 $62.6 $74.2 $62.9 $82.0e FY total reported device sales
Slide 11: Cumulative $55.3 Billion Returned to Stockholders
Cumulative $55.3 Billion Returned to Stockholders As of December 25, 2016 Stock Repurchases* (Billions) $2.5 billion remained authorized for $11.25 repurchase under our stock repurchase program. $4.61 $4.55 $3.92 $3.02 $0.17 $0.95 $1.50 $1.48 $1.67 $0.28 $0.14 $1.31 $0.44 FY’03 FY’05 FY’06 FY’07 FY’
Slide 12: Financial Strength
Financial Strength In Billions Dec’15 Dec’16 Domestic $2.7 $1.9 Offshore $27.9 $27.9 Total cash, cash equivalents & marketable securities $30.6 $29.8 Total assets $50.2 $52.4 Stockholders’ equity $30.2 $31.2 Debt* $11.0 $11.7 EBITDA** (6) $2.0 $1.1 Free cash flow*** (6) $2.6 $1.3 * Including short-t
Slide 13: Footnotes
Footnotes 1. Non-GAAP results exclude the QSI (Qualcomm Strategic Initiatives) segment and certain share-based compensation, acquisition-related items, tax items and other items. Further discussion regarding the Company’s use of Non-GAAP financial measures and detailed reconciliations between GAAP a
Slide 14: Reconciliations
Reconciliations
Slide 15: Note Regarding Use of Non-GAAP Financial Measures
Note Regarding Use of Non-GAAP Financial Measures The Non-GAAP financial information presented herein should be considered in addition to, not as a substitute for or superior to, financial measures calculated in accordance with GAAP. In addition, “Non- GAAP” is not a term defined by GAAP, and as a r
Slide 16: Non-GAAP Results
Non-GAAP Results In millions, except per share data Non-GAAP Share-Based Other QSI GAAP Results Results Compensation Items(1)(2)(3) Net income (loss) $1,783 ($11) ($190) ($900) $682 Q1: Diluted EPS $1.19 ($0.01) ($0.13) ($0.60) $0.46 Fiscal 2017 Diluted shares 1,495 1,495 1,495 1,495 1,495 Net incom
Slide 17: EBITDA
EBITDA(1) In millions Q1’16 Q1’17 Net income $1,496 $681 Plus: Income tax expense 214 189 Plus: Depreciation and amortization expense 364 329 Plus: Interest expense 74 90 Less: Interest and dividend income 136 167 EBITDA $2,012 $1,122 (1) EBITDA is defined as net income (before adjustments for nonco
Slide 18: Q1'17 Combined R&D and SG&A Expenses, Sequential Comparison
Q1’17 Combined R&D and SG&A Expenses, Sequential Comparison In millions Q4’16 Q1’17 % Increased Results Results Non-GAAP combined R&D and SG&A expenses $1,564 $1,575 1% QSI 4 3 Other Items(1) 25 94 Share-based compensation allocated to R&D and SG&A 204 230 Total GAAP combined R&D and SG&A expenses $
Slide 19: Tax Rates
Tax Rates In millions Non-GAAP Share-Based Other QSI GAAP Results Results Compensation Items(2) Estimated annual tax Fiscal 2017 18% 0%(1) 0%(1) 4%(1) 22% rate (1) The incremental effect of our Non-GAAP adjustments to the GAAP tax rate is calculated by allocating the difference between (i) the tax e
Slide 20: Free Cash Flow
Free Cash Flow(a) In millions Q1’17 Net cash provided by operating activities $1,379 Less: Capital expenditures 129 Free cash flow $1,250 Plus: Cash paid to repurchase shares of our common stock (before commissions) $444 Plus: Cash dividends paid 784 Total return of capital to stockholders $2,478 (a
Slide 21: Free Cash Flow
Free Cash Flow(a) Three Months Ended December 25, 2016 In millions Non-GAAP QSI Share-Based Other Items (b) GAAP Results Compensation Results Net cash provided (used) by operating activities $1,444 ($14) ($35) (c) ($16) $1,379 Less: Capital expenditures (129) - - - (129) Free cash flow $1,315 ($14)
Slide 22: Previous Business Outlook
Previous Business Outlook As of November 2, 2016 Previous Guidance First Fiscal Quarter Q1’17 Estimates Revenues $5.7B - $6.5B GAAP diluted EPS $0.91 - $1.01 Less diluted EPS attributable to QSI $0.01 Less diluted EPS attributable to share-based compensation ($0.13) Less diluted EPS attributable to
Slide 23: Business Outlook
Business Outlook As of January 25, 2017 Current Guidance First Fiscal Quarter Q2’16 Results Q2’17 Estimates Revenues $5.6B $5.5B - $6.3B Year-over-year change decrease 1% - increase 13% GAAP diluted EPS $0.78 $0.89 - $0.99 Year-over-year change increase 14% - increase 27% Less diluted EPS attributab
Slide 24: Q2'17 Combined R&D and SG&A Expenses Guidance
Q2’17 Combined R&D and SG&A Expenses Guidance* In millions Q1’17 Results Q2’17 Guidance* (est.) Non-GAAP combined R&D and SG&A expenses $1,575 Approx. increase 6% - 8% QSI 3 Not provided Other Items(1) 94 Not provided Total combined R&D and SG&A expenses excluding certain 1,672 Approx. increase 4% -
Slide 25: Thank you
Thank you Follow us on: For more information, visit us at: www.qualcomm.com & www.qualcomm.com/blog Nothing in these materials is an offer to sell any of the components or devices referenced herein. ©2016 Qualcomm Technologies, Inc. and/or its affiliated companies. All Rights Reserved. Qualcomm is a