Qualcomm Announces First Quarter Fiscal 2010 Results

By Qualcomm Incorporated, PRNE
Tuesday, January 26, 2010

Revenues US$2.7 Billion, EPS US$0.50

SAN DIEGO, January 27 - Qualcomm Incorporated (Nasdaq: QCOM), a leading developer and innovator
of advanced wireless technologies, products and services, today announced
results for the first quarter of fiscal 2010 ended December 27, 2009.

"We are pleased with our performance this quarter, driven by healthy
demand for our chipsets, strong shipments of 3G devices by our licensees and
lower operating expenses. We're executing on our strategic objectives and
reaffirming our 2010 3G device forecast, an increase of 21 percent
year-over-year," said Dr. Paul E. Jacobs, chairman and CEO of Qualcomm. "I am
very encouraged by customer traction around Qualcomm technologies, including
recent device announcements based on our industry-leading Snapdragon(TM)
chipset and increased adoption of our Brew Mobile Platform(TM) operating
system. As anticipated, we have seen a competitive pricing environment in the
chipset market and are proactively managing within this dynamic to grow our
market share. A subdued economic recovery in developed regions, including
Europe and Japan, combined with relative strength at the lower end of the
market, is changing our estimated 3G device average selling price and chipset
mix for this fiscal year. Accordingly, we are modestly reducing our fiscal
year revenue estimates to reflect this near-term market situation, but are
maintaining our earnings per share guidance."

"The fundamental drivers of our business remain strong. We are confident
that 3G will continue to develop as anticipated, and we continue to invest in
innovative new products, such as Snapdragon, FLO TV(TM), mirasol(TM) and
next-generation technologies, to enhance our leadership position and
capitalize on this growth."

First Quarter Results (GAAP)

    - Revenues: US$2.67 billion, up 6 percent year-over-year and
      down 1 percent sequentially.
    - Operating income: US$879 million, up 18 percent year-over-year
      and 47 percent sequentially.
    - Net income: US$841 million, up 147 percent year-over-year and 5
      percent sequentially.
    - Diluted earnings per share: US$0.50, up 150 percent
      year-over-year and 4 percent sequentially.
    - Effective tax rate: 20 percent for the quarter. Fiscal 2010
      estimated tax rate of approximately 21 percent.
    - Operating cash flow: US$1.24 billion, down 65 percent
      year-over-year; 46 percent of revenues.
    - Return of capital to stockholders: US$284 million, or US$0.17 per
      share, of cash dividends paid.

Pro Forma First Quarter Results

Pro forma results exclude the Qualcomm Strategic Initiatives (QSI)
segment, certain share-based compensation, certain tax items that are not
related to the current year and acquired in-process research and development
(R&D) expense.

    - Revenues: US$2.67 billion, up 6 percent year-over-year and
      down 1 percent sequentially.
    - Operating income: US$1.13 billion, up 15 percent year-over-year
      and 36 percent sequentially.
    - Net income: US$1.04 billion, up 100 percent year-over-year and 28
      percent sequentially.
    - Diluted earnings per share: US$0.62, up 100 percent
      year-over-year and 29 percent sequentially. The current quarter
      excludes US$0.03 loss per share attributable to the QSI segment,
      US$0.07 loss per share attributable to certain share-based compensation
      and US$0.02 loss per share attributable to certain tax items.
    - Effective tax rate: 21 percent for the quarter. Fiscal 2010 estimated
      tax rate of approximately 21 to 22 percent.
    - Free cash flow: US$1.27 billion, down 63 percent year-over-year;
      48 percent of revenues (defined as net cash from operating activities
      less capital expenditures).

The large increase in net income year-over-year was primarily due to a
significant improvement in net investment income as our marketable securities
recovered value and financial markets stabilized. The significant decrease in
cash flows year-over-year was primarily due to the receipt of a US$2.5
billion
payment in the first quarter of fiscal 2009 related to the license
and settlement agreements with Nokia.

Detailed reconciliations between results reported in accordance with
generally accepted accounting principles (GAAP) and pro forma results are
included at the end of this news release. Prior period reconciliations are
presented on Qualcomm's Investor Relations web page at www.qualcomm.com.

Cash and Marketable Securities

Our cash, cash equivalents and marketable securities totaled
approximately US$18.9 billion at the end of the first quarter of fiscal 2010,
compared to US$17.7 billion at the end of the fourth quarter of fiscal 2009
and US$13.1 billion a year ago. On January 7, 2010, we announced a cash
dividend of US$0.17 per share payable on March 26, 2010 to stockholders of
record as of February 26, 2010.

(All amounts in U.S. dollars unless otherwise noted.)

Research and Development

                                            Share-Based
    ($ in millions)            Pro Forma    Compensation      QSI        GAAP
                               ---------    ------------      ---        ----

    First quarter fiscal 2010    $503           $72           $21       $596
    As a % of revenues             19%                        N/M         22%
    First quarter fiscal 2009    $511           $69           $24       $604
    As a % of revenues             20%                        N/M         24%
    Year-over-year change ($)      (2%)           4%          (13%)      (1%)
    N/M - Not Meaningful

Pro forma R&D expenses primarily related to the development of integrated
circuit products, next-generation CDMA and OFDMA technologies, the expansion
of our intellectual property portfolio and other initiatives to support the
acceleration of advanced wireless products and services. QSI R&D expenses
were related to our FLO TV subsidiary.

Selling, General and Administrative

                                              Share-Based
    ($ in millions)              Pro Forma    Compensation     QSI       GAAP
                                 ---------    ------------     ---       ----

    First quarter fiscal 2010       $272          $68          $39      $379
    As a % of revenues                10%                      N/M        14%
    First quarter fiscal 2009       $305          $66          $42      $413
    As a % of revenues                12%                      N/M        16%
    Year-over-year change ($)        (11%)          3%          (7%)     (8%)

Pro forma selling, general and administrative (SG&A) expenses decreased
by 11 percent year-over-year, primarily due to a decrease in costs related to
litigation and other legal matters. QSI SG&A expenses were primarily related
to FLO TV.

Effective Income Tax Rate

Our fiscal 2010 effective income tax rates are estimated to be
approximately 21 percent for GAAP and approximately 21 to 22 percent for pro
forma. Our estimate of the fiscal 2010 GAAP effective tax rate includes tax
expense of approximately US$130 million that arises because deferred revenue
related to the 2008 license and settlement agreements with Nokia is taxable
in fiscal 2010, but the resulting deferred tax asset will reverse in future
years when our state tax rate will be lower as a result of California tax
legislation enacted in 2009. This tax expense was excluded from our pro forma
results to provide a clearer understanding of our ongoing tax rate and after
tax earnings.

Qualcomm Strategic Initiatives

The QSI segment is composed of our strategic investments, including FLO
TV. GAAP results for the first quarter of fiscal 2010 included a US$0.03
diluted loss per share for the QSI segment. The first quarter of fiscal 2010
QSI results included US$106 million in operating expenses, primarily related
to FLO TV.

Business Outlook

The following statements are forward looking and actual results may
differ materially. The "Note Regarding Forward-Looking Statements" at the end
of this news release provides a description of certain risks that we face,
and our annual and quarterly reports on file with the Securities and Exchange
Commission (SEC) provide a more complete description of risks.

The potential instability in financial markets may continue to have an
impact on the value of our marketable securities and net investment income
(loss). While we do not forecast impairments, we have temporary unrealized
losses on marketable securities that could be recognized as
other-than-temporary losses in future periods if financial conditions
affecting those securities do not improve.

Our outlook does not include provisions for the consequences of
injunctions, damages or fines related to any pending legal matters unless
awarded or imposed by a court, governmental entity or other regulatory body.
In addition, due to their nature, certain income and expense items, such as
realized investment gains or losses, gains and losses on certain derivative
instruments or asset impairments, cannot be accurately forecast. Accordingly,
we exclude forecasts of such items from our business outlook, and actual
results may vary materially from the business outlook if we incur any such
income or expense items.

The following table summarizes GAAP and pro forma guidance based on the
current business outlook. The pro forma business outlook provided below is
presented consistent with the presentation of pro forma results elsewhere
herein.

The following estimates are approximations and are based on the current
business outlook:

                  Qualcomm's Business Outlook Summary

    SECOND FISCAL QUARTER
    ---------------------

                                     Q2 FY09             Current Guidance
                                    Results (2)          Q2 FY10 Estimates
                                    -----------          -----------------
      Pro Forma
      Revenues                          $2.45B               $2.40B - $2.60B
        Year-over-year change                      decrease 2% - increase 6%
      Diluted earnings per
       share (EPS)                      ($0.03)                $0.49 - $0.53
        Year-over-year change                                            N/M

      GAAP
      Revenues                          $2.46B               $2.40B - $2.60B
        Year-over-year change                      decrease 2% - increase 6%
      Diluted EPS                       ($0.18)                $0.35 - $0.39
        Year-over-year change                                            N/M
       Diluted EPS attributable
        to QSI                          ($0.03)                      ($0.05)
       Diluted EPS attributable to
        share-based compensation        ($0.09)                      ($0.07)
       Diluted EPS attributable
        to certain tax items (3)        ($0.02)                      ($0.02)
       Diluted EPS attributable to
        in-process R&D                   $0.00                           N/A

      Metrics

      MSM shipments                approx. 69M             approx. 88M - 92M
      CDMA/WCDMA devices
       shipped (1)                approx. 128M*          approx. 144M - 149M*
      CDMA/WCDMA device wholesale
       average selling price (1)  approx. $201*                 approx. $179*

       *Shipments in December quarter, reported in March quarter
       ---------------------------------------------------------
    FISCAL YEAR
    -----------

                           FY 2009      Prior Guidance    Current Guidance
                         Results (2)   FY 2010 Estimates  FY 2010 Estimates
                         -----------   -----------------  -----------------

      Pro Forma
      Revenues              $10.39B   $10.50B - $11.30B    $10.40B - $11.00B
        Year-over-year
         change                        increase 1% - 9%   even - increase 6%
      Diluted EPS             $1.31       $2.10 - $2.30        $2.10 - $2.30
        Year-over-year
         change                      increase 60% - 76%   increase 60% - 76%

      GAAP
      Revenues              $10.42B   $10.50B - $11.30B    $10.40B - $11.00B
        Year-over-year
         change                        increase 1% - 8%   even - increase 6%
      Diluted EPS             $0.95       $1.56 - $1.76        $1.56 - $1.76
        Year-over-year
         change                      increase 64% - 85%   increase 64% - 85%
      Diluted EPS
       attributable
       to QSI                ($0.15)             ($0.19)              ($0.18)
      Diluted EPS
       attributable to
       share-based
       compensation          ($0.27)             ($0.28)              ($0.28)
      Diluted EPS
       attributable
       to in-process R&D      $0.00                 N/A                  N/A
      Diluted EPS
       attributable to
       certain tax
       items (3)              $0.07              ($0.07)              ($0.08)

      Metrics
      Fiscal year*
       CDMA/WCDMA
       device wholesale
       average selling
       price (1)       approx. $200        approx. $189         approx. $181

     *Shipments in Sept. to June quarters, reported in Dec. to Sept. quarters
      -----------------------------------------------------------------------
    CALENDAR YEAR Device Estimates (1)
    ----------------------------------

                        Prior        Current        Prior         Current
                       Guidance      Guidance      Guidance       Guidance
      CDMA/WCDMA       Calendar      Calendar      Calendar       Calendar
       device            2009          2009          2010           2010
       shipments      Estimates     Estimates      Estimates      Estimates
    -----------------------------------------------------------------------

      March quarter  approx. 111M  approx. 111M   not provided   not provided
      June quarter   approx. 127M  approx. 127M   not provided   not provided

      September      approx.
       quarter        130M - 135M  approx. 133M   not provided   not provided
      December                     approx.
       quarter       not provided   144M - 149M   not provided   not provided
    ----------       ------------   -----------   ------------   ------------
      Calendar
       year range
       (approx.)      515M - 530M   515M - 520M    600M - 650M    600M - 650M
    ----------        -----------   -----------    -----------    -----------
                        Midpoint     Midpoint       Midpoint       Midpoint
      CDMA/WCDMA
       units         approx. 523M  approx. 518M   approx. 625M   approx. 625M

      CDMA units     approx. 213M  approx. 210M   approx. 231M   approx. 231M
      WCDMA units    approx. 310M  approx. 308M   approx. 394M   approx. 394M
    -------------------------------------------------------------------------

    (1)    CDMA/WCDMA device shipments and average selling prices are for
           estimated worldwide device shipments, including shipments not
           reported to Qualcomm.
    (2)    Fiscal 2009 results included a $783 million charge related to a
           litigation settlement and patent agreement with Broadcom
           Corporation, including $748 million recorded in the second quarter
           of fiscal 2009 and $35 million recorded in the fourth quarter of
           2009. The fourth quarter of fiscal 2009 results also included a
           $230 million charge related to a fine that had been announced by
           the Korea Fair Trade Commission.
    (3)    The estimate of our fiscal 2010 GAAP effective tax rate includes
           tax expense of approximately $130 million that arises because
           deferred revenue related to the 2008 license and settlement
           agreements with Nokia is taxable in fiscal 2010 but the resulting
           deferred tax asset will reverse in future years when our state tax
           rate will be lower as a result of California tax legislation
           enacted in 2009.
    Sums may not equal totals due to rounding.
    N/M - Not Meaningful

Results of Business Segments (in millions, except per share data):

    First Quarter - Fiscal Year 2010

    Segments                        QCT        QTL       QWI
    --------                        ---        ---       ---
    Revenues                      $1,608       $917      $142
    --------                      ------       ----      ----
    Change from prior year            21%       (9%)     (16%)
    ----------------------           ---       ----      ----
    Change from prior quarter        (5%)        10%      (3%)
    -------------------------        ---        ---      ----
    Operating income (loss)
    -----------------------
    Change from prior year
    ----------------------
    Change from prior quarter
    -------------------------
    EBT                             $425       $772        $9
    ---                             ----       ----       ---
    Change from prior year           153%      (12%)      200%
    ----------------------           ---       ----       ---
    Change from prior quarter        (16%)       11%      N/M
    -------------------------        ---        ---       ---
    EBT as a % of revenues            26%        84%        6%
    ----------------------           ---        ---       ---
    Net income (loss)
    -----------------
    Change from prior year
    ----------------------
    Change from prior quarter
    -------------------------
    Diluted EPS
    -----------
    Change from prior year
    ----------------------
    Change from prior quarter
    -------------------------
    Diluted shares used
    -------------------

                                 Pro Forma
                                Reconciling                    Share-Based
    Segments                     Items (1)     Pro Forma     Compensation (2)
    --------                    -----------    ---------     ----------------
    Revenues                         $1          $2,668              $-
    --------                        ---          ------             ---
    Change from prior year          N/M               6%
    ----------------------          ---             ---
    Change from prior quarter       N/M             (1%)
    -------------------------       ---             ---
    Operating income (loss)                      $1,134           $(151)
    -----------------------                      ------           -----
    Change from prior year                           15%            (4%)
    ----------------------                          ---             ---
    Change from prior quarter                        36%            (2%)
    -------------------------                       ---            ----
    EBT                            $104          $1,310           $(151)
    ---                            ----          ------           -----
    Change from prior year          N/M              89%            (4%)
    ----------------------          ---             ---             ---
    Change from prior quarter       N/M              33%            (2%)
    -------------------------       ---             ---             ---
    EBT as a % of revenues          N/M              49%            N/M
    ----------------------          ---             ---             ---
    Net income (loss)                            $1,041           $(114)
    -----------------                            ------           -----
    Change from prior year                          100%           (15%)
    ----------------------                          ---            ----
    Change from prior quarter                        28%           (34%)
    -------------------------                       ---            ----
    Diluted EPS                                   $0.62          $(0.07)
    -----------                                   -----          ------
    Change from prior year                          100%           (17%)
    ----------------------                          ---            ----
    Change from prior quarter                        29%           (40%)
    -------------------------                       ---            ----
    Diluted shares used                           1,691           1,691
    -------------------                           -----           -----

    Segments                  Tax Items (3)       QSI (4)         GAAP
    --------                  -------------       -------         ----
    Revenues                        $-               $2          $2,670
    --------                       ---              ---          ------
    Change from prior year                         (67%)              6%
    ----------------------                         ----             ---
    Change from prior quarter                      (71%)            (1%)
    -------------------------                      ----             ---
    Operating income (loss)         $-            $(104)           $879
    -----------------------        ---            -----            ----
    Change from prior year                          (8%)             18%
    ----------------------                          ---             ---
    Change from prior quarter                      (21%)             47%
    -------------------------                      ----             ---
    EBT                             $-            $(107)         $1,052
    ---                            ---            -----          ------
    Change from prior year                          (9%)            133%
    ----------------------                          ---             ---
    Change from prior quarter                      (13%)             42%
    -------------------------                      ----             ---
    EBT as a % of revenues                          N/M              39%
    ----------------------                          ---             ---
    Net income (loss)             $(32)            $(54)           $841
    -----------------             ----             ----            ----
    Change from prior year         N/M               33%            147%
    ----------------------         ---              ---             ---
    Change from prior quarter      N/M               31%              5%
    -------------------------      ---              ---             ---
    Diluted EPS                 $(0.02)          $(0.03)          $0.50
    -----------                 ------           ------           -----
    Change from prior year         N/M               40%            150%
    ----------------------         ---              ---             ---
    Change from prior quarter      N/M               40%              4%
    -------------------------      ---              ---             ---
    Diluted shares used          1,691            1,691           1,691
    -------------------          -----            -----           -----
    Fourth Quarter - Fiscal Year 2009

    Segments                    QCT        QTL       QWI
    --------                    ---        ---       ---
    Revenues                  $1,699       $837      $146
    --------                  ------       ----      ----
    Operating income (loss)
    -----------------------
    EBT                          508        693        (5)
    ---                          ---        ---       ---
    Net income (loss)
    -----------------
    Diluted EPS
    -----------
    Diluted shares used
    -------------------

                                 Pro Forma
                                Reconciling                    Share-Based
    Segments                     Items (1)      Pro Forma    Compensation (2)
    --------                    -----------     ---------    ----------------
    Revenues                         $1           $2,683             $-
    --------                        ---           ------            ---
    Operating income (loss)                          831           (148)
    -----------------------                          ---           ----
    EBT                            (211)             985           (148)
    ---                            ----              ---           ----
    Net income (loss)                                811            (85)
    -----------------                                ---            ---
    Diluted EPS                                    $0.48         $(0.05)
    -----------                                    -----         ------
    Diluted shares used                            1,688          1,688
    -------------------                            -----          -----

    Segments                   Tax Items      QSI (4)       GAAP
    --------                   ---------      -------       ----
    Revenues                        $-            $7       $2,690
    --------                       ---           ---       ------
    Operating income (loss)          -           (86)         597
    -----------------------        ---           ---          ---
    EBT                              -           (95)         742
    ---                            ---           ---          ---
    Net income (loss)              155           (78)         803
    -----------------              ---           ---          ---
    Diluted EPS                  $0.09        $(0.05)       $0.48
    -----------                  -----        ------        -----
    Diluted shares used          1,688         1,688        1,688
    -------------------          -----         -----        -----
    First Quarter - Fiscal Year 2009

    Segments                    QCT        QTL       QWI
    --------                    ---        ---       ---
    Revenues                  $1,334     $1,006      $170
    --------                  ------     ------      ----
    Operating income (loss)
    -----------------------
    EBT                          168        874         3
    ---                          ---        ---       ---
    Net income (loss)
    -----------------
    Diluted EPS
    -----------
    Diluted shares used
    -------------------

                                Pro Forma
                               Reconciling                    Share-Based
    Segments                    Items (1)    Pro Forma      Compensation (2)
    --------                   -----------   ---------      ----------------
    Revenues                         $1        $2,511                $-
    --------                        ---        ------               ---
    Operating income (loss)                       986              (145)
    ----------------                              ---              ----
    EBT                            (351)          694              (145)
    ---                            ----           ---              ----
    Net income (loss)                             520               (99)
    -----------------                             ---               ---
    Diluted EPS                                 $0.31            $(0.06)
    -----------                                 -----            ------
    Diluted shares used                         1,667             1,667
    -------------------                         -----             -----

    Segments                    QSI (4)        GAAP
    --------                    -------        ----
    Revenues                        $6        $2,517
    --------                       ---        ------
    Operating income (loss)        (96)          745
    -----------------------        ---           ---
    EBT                            (98)          451
    ---                            ---           ---
    Net income (loss)              (80)          341
    -----------------              ---           ---
    Diluted EPS                 $(0.05)        $0.20
    -----------                 ------         -----
    Diluted shares used          1,667         1,667
    -------------------          -----         -----

    Second Quarter - Fiscal Year 2009

                                                              Pro Forma
                                                             Reconciling
    Segments                    QCT        QTL       QWI      Items (1)
    --------                    ---        ---       ---     -----------
    Revenues                  $1,316       $954      $176          $1
    --------                  ------       ----      ----         ---
    Operating income (loss)
    -----------------------
    EBT                          217        839        25        (934)
    ---                          ---        ---       ---        ----
    Net (loss) income
    -----------------
    Diluted EPS
    -----------
    Diluted shares used
    -------------------

                                               Share-Based
    Segments                   Pro Forma     Compensation (2)     Tax Items
    --------                   ---------     ----------------     ---------
    Revenues                     $2,447                $-               $-
    --------                     ------               ---              ---
    Operating income (loss)         214              (140)               -
    -----------------------         ---              ----              ---
    EBT                             147              (140)               -
    ---                             ---              ----              ---
    Net (loss) income               (46)             (145)             (36)
    -----------------               ---              ----              ---
    Diluted EPS                  $(0.03)           $(0.09)          $(0.02)
    -----------                  ------            ------           ------
    Diluted shares used           1,651             1,651            1,651
    -------------------           -----             -----            -----

                                In-Process
    Segments                       R&D        QSI (4)      GAAP
    --------                    ----------    -------      ----
    Revenues                         $-           $8      $2,455
    --------                        ---          ---      ------
    Operating income (loss)          (6)         (78)        (10)
    -----------------------         ---          ---         ---
    EBT                              (6)        (102)       (101)
    ---                             ---         ----        ----
    Net (loss) income                (6)         (56)       (289)
    -----------------               ---          ---        ----
    Diluted EPS                      $-       $(0.03)     $(0.18)
    -----------                     ---       ------      ------
    Diluted shares used           1,651        1,651       1,651
    -------------------           -----        -----       -----
    Twelve Months - Fiscal Year 2009

                                                              Pro Forma
                                                             Reconciling
    Segments                    QCT        QTL       QWI      Items (1)
    --------                    ---        ---       ---     -----------
    Revenues                  $6,135     $3,605      $641          $6
    --------                  ------     ------      ----         ---
    Operating income (loss)
    -----------------------
    EBT                        1,441      3,068        20      (1,502)
    ---                        -----      -----       ---      ------
    Net income (loss)
    -----------------
    Diluted EPS
    -----------
    Diluted shares used
    -------------------

                                               Share-Based
    Segments                   Pro Forma     Compensation (2)     Tax Items
    --------                   ---------     ----------------     ---------
    Revenues                    $10,387                $-             $-
    --------                    -------               ---            ---
    Operating income (loss)       3,153              (584)             -
    -----------------------       -----              ----            ---
    EBT                           3,027              (584)             -
    ---                           -----              ----            ---
    Net income (loss)             2,187              (455)           118
    -----------------             -----              ----            ---
    Diluted EPS                   $1.31            $(0.27)         $0.07
    -----------                   -----            ------          -----
    Diluted shares used           1,673             1,673          1,673
    -------------------           -----             -----          -----

                                In-Process
    Segments                       R&D          QSI        GAAP
    --------                    ----------      ---        ----
    Revenues                         $-          $29     $10,416
    --------                        ---          ---     -------
    Operating income (loss)          (6)        (337)      2,226
    -----------------------         ---         ----       -----
    EBT                              (6)        (361)      2,076
    ---                             ---         ----       -----
    Net income (loss)                (6)        (252)      1,592
    -----------------               ---         ----       -----
    Diluted EPS                      $-       $(0.15)      $0.95
    -----------                     ---       ------       -----
    Diluted shares used           1,673        1,673       1,673
    -------------------           -----        -----       -----

    (1)    Pro forma reconciling items related to revenues consist primarily
           of other nonreportable segment revenues less intersegment
           eliminations.  Pro forma reconciling items related to earnings
           before taxes consist primarily of certain investment income or
           losses, research and development expenses, sales and marketing
           expenses and other operating expenses that are not allocated to
           the segments for management reporting purposes, nonreportable
           segment results and the elimination of intersegment profit.
    (2)    Certain share-based compensation is included in operating expenses
           as part of employee-related costs but is not allocated to the
           Company's segments as such costs are not considered relevant by
           management in evaluating segment performance.
    (3)    During the first quarter of fiscal 2010, the Company recorded a
           $32 million state tax expense, or $0.02 diluted loss per share,
           that arises because deferred revenue related to the license and
           settlement agreements with Nokia is taxable in fiscal 2010 but the
           resulting deferred tax asset will reverse in future years when the
           Company's state tax rate will be lower.
    (4)    At fiscal year-end, the sum of the quarterly tax provisions for
           each column, including QSI, equals the annual tax provisions for
           each column computed in accordance with GAAP.  In interim
           quarters, the tax provision for the QSI operating segment is
           computed by subtracting the pro forma tax provision, the tax items
           column and the tax provision related to share-based compensation
           from the GAAP tax provision.
    N/M - Not Meaningful
    Sums may not equal totals due to rounding.

Conference Call

Qualcomm's first quarter fiscal 2010 earnings conference call will be
broadcast live on January 27, 2010 beginning at 1:45 p.m. Pacific Time (PT)
on the Company's web site at: www.qualcomm.com. This conference call may
contain forward-looking financial information and will include a discussion
of "non-GAAP financial measures" as that term is defined in Regulation G. The
most directly comparable GAAP financial measures and information reconciling
these non-GAAP financial measures to the Company's financial results prepared
in accordance with GAAP, as well as the other material financial and
statistical information to be discussed in the conference call, will be
posted on the Company's Investor Relations web site at www.qualcomm.com
immediately prior to commencement of the call. A taped audio replay will be
available via telephone on January 27, 2010, beginning at approximately 5:30
p.m. PT
through February 27, 2010 at 9:00 p.m. PT. To listen to the replay,
U.S. callers may dial +1-800-642-1687 and international callers may dial
+1-706-645-9291. U.S. and international callers should use reservation number
50788237. An audio replay of the conference call will be available on the
Company's web site at www.qualcomm.com for two weeks following the live call.

Editor's Note: To view the web slides that accompany this earnings
release and conference call, please go to the Qualcomm Investor Relations
website at investor.qualcomm.com/results.cfm.

Qualcomm Incorporated (Nasdaq: QCOM) is a leader in developing and
delivering innovative digital wireless communications products and services
based on CDMA and other advanced technologies. Headquartered in San Diego,
Calif
., Qualcomm is included in the S&P 100 Index, the S&P 500 Index and is a
2009 FORTUNE 500(R) company. For more information, please visit
www.qualcomm.com.

Note Regarding Use of Non-GAAP Financial Measures

The Company presents pro forma financial information that is used by
management (i) to evaluate, assess and benchmark the Company's operating
results on a consistent and comparable basis; (ii) to measure the performance
and efficiency of the Company's ongoing core operating businesses, including
the Qualcomm CDMA Technologies, Qualcomm Technology Licensing and Qualcomm
Wireless & Internet segments; and (iii) to compare the performance and
efficiency of these segments against each other and against competitors
outside the Company. Pro forma measurements of the following financial data
are used by the Company's management: revenues, R&D expenses, SG&A expenses,
total operating expenses, operating income (loss), net investment income
(loss), income (loss) before income taxes, effective tax rate, net income
(loss), diluted earnings (loss) per share, operating cash flow and free cash
flow. Management is able to assess what it believes is a more meaningful and
comparable set of financial performance measures for the Company and its
business segments by using pro forma information. As a result, management
compensation decisions and the review of executive compensation by the
Compensation Committee of the Board of Directors focus primarily on pro forma
financial measures applicable to the Company and its business segments.

Pro forma information used by management excludes the QSI segment,
certain share-based compensation, certain tax items and acquired in-process
R&D. The QSI segment is excluded because the Company expects to exit its
strategic investments at various times, and the effects of fluctuations in
the value of such investments are viewed by management as unrelated to the
Company's operational performance. Share-based compensation, other than
amounts related to share-based awards granted under a bonus program that may
result in the issuance of unrestricted shares of the Company's common stock,
is excluded because management views such share-based compensation as
unrelated to the Company's operational performance. Moreover, it is generally
not an expense that requires or will require cash payment by the Company.
Further, share-based compensation related to stock options is affected by
factors that are subject to change, including the Company's stock price,
stock market volatility, expected option life, risk-free interest rates and
expected dividend payouts in future years. Certain tax items that were
recorded in reported earnings in each fiscal year presented, but were
unrelated to the fiscal year in which they were recorded, are excluded in
order to provide a clearer understanding of the Company's ongoing pro forma
tax rate and after tax earnings. Acquired in-process R&D is excluded because
such expense is viewed by management as unrelated to the operating activities
of the Company's ongoing core businesses.

The Company presents free cash flow, defined as net cash provided by
operating activities less capital expenditures, to facilitate an
understanding of the amount of cash flow generated that is available to grow
its business and to create long-term shareholder value. The Company believes
that this presentation is useful in evaluating its operating performance and
financial strength. In addition, management uses this measure to evaluate the
Company's performance, to value the Company and to compare its operating
performance with other companies in the industry.

The non-GAAP pro forma 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, "pro forma" is not
a term defined by GAAP, and, as a result, the Company's measure of pro forma
results might be different than similarly titled measures used by other
companies. Reconciliations between GAAP results and pro forma results are
presented herein.

Note Regarding Forward-Looking Statements

In addition to the historical information contained herein, this news
release contains forward-looking statements that are subject to risks and
uncertainties. Actual results may differ substantially from those referred to
herein due to a number of factors, including but not limited to risks
associated with: the rate of deployment and adoption of our technologies in
wireless networks and of wireless communications, equipment and services,
including CDMA2000 1X, 1xEV-DO, WCDMA, HSPA, TD-SCDMA and OFDMA both
domestically and internationally; the current uncertainty of global economic
conditions and its potential impact on demand for our products, services or
applications and the value of our marketable securities; attacks on our
business model, including results of current and future litigation and
arbitration proceedings, as well as actions of governmental or
quasi-governmental bodies, and the costs we incur in connection therewith,
including potentially damaged relationships with customers and operators who
may be impacted by the results of these proceedings; our dependence on major
customers and licensees; our dependence on third-party manufacturers and
suppliers; our ability to maintain and improve operational efficiencies and
profitability; the development, deployment and commercial acceptance of the
FLO TV network and FLO(TM) technology; the development and commercial
acceptance of the IMOD display technology; foreign currency fluctuations;
strategic investments and transactions we have or may pursue; as well as the
other risks detailed from time-to-time in our SEC reports.

Qualcomm is a registered trademark of Qualcomm Incorporated. Snapdragon,
mirasol, FLO TV and FLO are trademarks of Qualcomm Incorporated. CDMA2000 is
a registered trademark of the Telecommunications Industry Association (TIA
USA). All other trademarks are the property of their respective owners.

    Qualcomm Contact:
    Warren Kneeshaw
    Phone: +1-858-658-2983
    e-mail: ir@qualcomm.com

                            Qualcomm Incorporated
                    CONSOLIDATED STATEMENTS OF OPERATIONS
          This schedule is to assist the reader in reconciling from
                      Pro Forma results to GAAP results
                    (In millions, except per share data)
                                  (Unaudited)

                                Three Months Ended December 27, 2009
                                ------------------------------------
                         Pro     Share-Based   Tax
                        Forma   Compensation  Items        QSI       GAAP
                        -----   ------------  -----        ---       ----
    Revenues:
      Equipment and
       services         $1,661         $-       $-          $2      $1,663
      Licensing and
       royalty fees      1,007          -        -           -       1,007
                         -----        ---      ---         ---       -----
          Total revenues 2,668          -        -           2       2,670
                         -----        ---      ---         ---       -----
    Operating expenses:
      Cost of equipment
       and services
       revenues            759         11        -          46         816
      Research and
       development         503         72        -          21         596
      Selling, general
       and administrative  272         68        -          39         379
                           ---        ---      ---         ---         ---
          Total operating
           expenses      1,534        151        -         106       1,791
                         -----        ---      ---         ---       -----

    Operating income
     (loss)              1,134       (151)       -        (104)        879

    Investment income
     (loss), net           176(a)       -        -          (3)(b)     173
                           ---        ---      ---         ---         ---
    Income (loss)
     before income
     taxes               1,310       (151)       -        (107)      1,052
    Income tax
     (expense) benefit    (269)(c)     37      (32)(e)      53(d)    (211)(c)
                          ----        ---      ---         ---        ----
    Net income (loss)   $1,041      $(114)    $(32)       $(54)       $841
                        ======      =====     ====        ====        ====

    Earnings (loss) per
     common share:
       Diluted           $0.62     $(0.07)  $(0.02)     $(0.03)      $0.50
                         =====     ======   ======      ======       =====

    Shares used in per
     share calculations:
       Diluted           1,691      1,691    1,691       1,691       1,691
                         =====      =====    =====       =====       =====

    Supplemental
     Financial Data:
    ----------------
    Operating Cash Flow $1,338       $(13)(g)   $-        $(86)     $1,239
    Operating Cash Flow
     as a % of Revenues     50%                            N/M          46%
    Free Cash Flow (f)  $1,271       $(13)(g)   $-       $(107)     $1,151
    Free Cash Flow as a
     % of Revenues          48%                            N/M          43%
    -------------------    ---                             ---         ---

    (a) Included $145 million in interest and dividend income related to
        cash, cash equivalents and marketable securities, which were not part
        of the Company's strategic investment portfolio, and $91 million in
        net realized gains on investments, partially offset by $51 million in
        other-than-temporary losses on investments, $5 million in interest
        expense and $4 million in losses on derivatives.
    (b) Included $6 million in other-than-temporary losses on investments,
        $4 million in interest expense and $4 million in equity in losses of
        investees, partially offset by $11 million in net realized gains on
        investments.
    (c) The first quarter of fiscal 2010 effective tax rates were
        approximately 20% for GAAP and approximately 21% for pro forma.
    (d) At fiscal year-end, the sum of the quarterly tax provisions for each
        column, including QSI, equals the annual tax provisions for each
        column computed in accordance with GAAP.  In interim quarters, the
        tax provision for the QSI operating segment is computed by
        subtracting the pro forma tax provision, the tax items column and the
        tax provision related to share-based compensation from the GAAP tax
        provision.
    (e) During the first quarter of fiscal 2010, the Company recorded a $32
        million state tax expense, or $0.02 diluted loss per share, that
        arises because deferred revenue related to the license and settlement
        agreements with Nokia is taxable in fiscal 2010 but the resulting
        deferred tax asset will reverse in future years when the Company's
        state tax rate will be lower.
    (f) Free Cash Flow is calculated as net cash provided by operating
        activities less capital expenditures.  Reconciliation of these
        amounts is included in the Reconciliation of Pro Forma Free Cash
        Flows to Net Cash Provided by Operating Activities (GAAP) and other
        supplemental disclosures for the three months ended December 27,
        2009, included herein.
    (g) Incremental tax benefits from stock options exercised during the
        period.
                             Qualcomm Incorporated
                 Reconciliation of Pro Forma Free Cash Flows to
                 Net Cash Provided by Operating Activities (GAAP)
                       and other supplemental disclosures
                                (In millions)
                                  (Unaudited)

                               Three Months Ended December 27, 2009

                                            Share-Based
                               Pro Forma    Compensation      QSI       GAAP
                               ---------    ------------      ---       ----

    Net cash provided (used)
     by operating activities     $1,338          $(13)(a)     $(86)    $1,239
    Less: capital
     expenditures                   (67)            -          (21)      (88)
                                    ---           ---          ---        ---
    Free cash flow               $1,271          $(13)       $(107)    $1,151
                                 ======          ====        =====     ======

    Other supplemental
     cash disclosures:
       Cash transfers
        from QSI (1)               $12            $-         $(12)        $-
       Cash transfers
        to QSI (2)                (113)            -          113          -
                                   ----           ---          ---        ---
       Net cash transfers         $(101)           $-         $101         $-
                                  =====           ===         ====        ===

    (1) Cash from sale of equity investments.
    (2) Funding for strategic debt and equity investments, capital
        expenditures and other QSI operating expenses.

                           Three Months Ended December 28, 2008

                                             Share-Based
                                 Pro Forma   Compensation     QSI       GAAP
                                 ---------   ------------     ---       ----

    Net cash provided (used)
     by operating activities       $3,629       $(16)(a)     $(112)    $3,501
    Less: capital expenditures       (210)         -           (24)     (234)
                                     ----        ---           ---       ----
    Free cash flow                 $3,419       $(16)        $(136)    $3,267
                                   ======       ====         =====     ======

    (a) Incremental tax benefits from stock options exercised during the
        period.
                               Qualcomm Incorporated
                       CONDENSED CONSOLIDATED BALANCE SHEETS
                       (In millions, except per share data)
                                    (Unaudited)

                                      ASSETS
                                                 December 27,   September 27,
                                                      2009            2009
                                                 ------------   -------------
     Current assets:
       Cash and cash equivalents                     $3,660          $2,717
       Marketable securities                          8,504           8,352
       Accounts receivable, net                         616             700
       Inventories                                      350             453
       Deferred tax assets                              199             149
       Other current assets                             245             199
                                                        ---             ---
               Total current assets                  13,574          12,570
     Marketable securities                            6,764           6,673
     Deferred tax assets                              1,118             843
     Property, plant and equipment, net               2,384           2,387
     Goodwill                                         1,490           1,492
     Other intangible assets, net                     3,142           3,065
     Other assets                                       431             415
                                                        ---             ---
               Total assets                         $28,903         $27,445
                                                    =======         =======

                       LIABILITIES AND STOCKHOLDERS' EQUITY
     Current liabilities:
       Trade accounts payable                          $415            $636
       Payroll and other benefits related
        liabilities                                     385             480
       Unearned revenues                                567             441
       Income taxes payable                             458              29
       Other current liabilities                      1,123           1,227
                                                      -----           -----
              Total current liabilities               2,948           2,813
     Unearned revenues                                3,775           3,464
     Other liabilities                                  827             852
                                                        ---             ---
              Total liabilities                       7,550           7,129
                                                      -----           -----

     Stockholders' equity:
       Preferred stock, $0.0001 par value;
        issuable in series; 8 shares authorized;
        none outstanding at December 27, 2009
        and September 27, 2009                            -               -
       Common stock, $0.0001 par value; 6,000
        shares authorized; 1,674 and 1,669 shares
        issued and outstanding at December 27, 2009
        and September 27, 2009, respectively              -               -
       Paid-in capital                                8,817           8,493
       Retained earnings                             11,792          11,235
       Accumulated other comprehensive income           744             588
                                                        ---             ---
              Total stockholders' equity             21,353          20,316
                                                     ------          ------
              Total liabilities and stockholders'
               equity                               $28,903         $27,445
                                                    =======         =======
                          Qualcomm Incorporated
             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  (In millions, except per share data)
                               (Unaudited)

                                                     Three Months Ended
                                                     ------------------
                                                December 27,    December 28,
                                                    2009            2008
                                                ------------    ------------

        Revenues:
          Equipment and services                    $1,663          $1,423
          Licensing and royalty fees                 1,007           1,094
                                                     -----           -----
             Total revenues                          2,670           2,517
                                                     -----           -----

        Operating expenses:
          Cost of equipment and services
           revenues                                    816             755
          Research and development                     596             604
          Selling, general and
           administrative                              379             413
                                                       ---             ---
             Total operating expenses                1,791           1,772
                                                     -----           -----

        Operating income                               879             745

        Investment income (loss), net                  173            (294)
                                                       ---            ----
             Income before income taxes              1,052             451
        Income tax expense                            (211)           (110)
                                                      ----            ----
             Net income                               $841            $341
                                                      ====            ====

        Basic earnings per common share              $0.50           $0.21
                                                     =====           =====
        Diluted earnings per common share            $0.50           $0.20
                                                     =====           =====

        Shares used in per share calculations:
           Basic                                     1,672           1,653
                                                     =====           =====
           Diluted                                   1,691           1,667
                                                     =====           =====

        Dividends per share paid                     $0.17              $-
                                                     =====             ===

        Dividends per share announced                $0.17           $0.16
                                                     =====           =====
                             Qualcomm Incorporated
                  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (In millions)
                                   (Unaudited)

                                                    Three Months Ended
                                                    ------------------
                                                December 27,     December 28,
                                                     2009             2008
                                                -------------   -------------
    Operating Activities:
    Net income                                         $841           $341
    Adjustments to reconcile net income
     to net cash provided by operating activities:
       Depreciation and amortization                    162            152
       Revenues related to non-monetary exchanges       (37)           (29)
       Non-cash portion of income tax expense            32             45
       Non-cash portion of share-based
        compensation expense                            151            145
       Incremental tax benefit from stock
        options exercised                               (13)           (16)
       Net realized (gains) losses on marketable
        securities  and other investments              (102)            33
       Net impairment losses on marketable
        securities and other investments                 57            392
       Other items, net                                   4            (14)
    Changes in assets and liabilities,
     net of effects of acquisitions:
        Accounts receivable, net                         87          2,716
        Inventories                                     101             65
        Other assets                                    (32)           (19)
        Trade accounts payable                         (226)          (192)
        Payroll, benefits and other liabilities        (124)           (54)
        Unearned revenues                               338            (64)
                                                        ---            ---
            Net cash provided by operating
             activities                               1,239          3,501
                                                      -----          -----
    Investing Activities:
      Capital expenditures                              (88)          (234)
      Purchases of available-for-sale securities     (2,098)        (2,586)
      Proceeds from sale of available-for-sale
       securities                                     2,013          1,373
      Cash received for partial settlement
       of investment receivables                          8            202
      Other investments and acquisitions,
       net of cash acquired                              (6)           (14)
      Change in collateral held under
       securities lending                                 -            162
      Other items, net                                   (1)            (4)
                                                        ---            ---
             Net cash used by investing
              activities                               (172)        (1,101)
                                                       ----         ------
    Financing Activities:
      Proceeds from issuance of common stock            152             26
      Incremental tax benefit from stock
       options exercised                                 13             16
      Repurchase and retirement of common stock           -           (285)
      Dividends paid                                   (284)             -
      Change in obligations under securities
       lending                                            -           (162)
      Other items, net                                   (1)            (1)
                                                        ---            ---
             Net cash used by financing
              activities                               (120)          (406)
                                                       ----           ----
      Effect of exchange rate changes on cash            (4)            (8)
                                                        ---            ---
             Net increase in cash and cash
              equivalents                               943          1,986
    Cash and cash equivalents at beginning
     of period                                        2,717          1,840
                                                      -----          -----
             Cash and cash equivalents at end of
              period                                 $3,660         $3,826
                                                     ======         ======

Warren Kneeshaw of Qualcomm Incorporated, +1-858-658-2983, ir at qualcomm.com

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