Qualcomm Faces Antitrust Probes in China, Europe And The U.S.
Qualcomm on Wednesday confirmed ongoing antitrust investigations in China the United States and Europe, while it also has problems collecting royalties. The inverstigation by China's National Development and Reform Commission (NDRC) concerns how Qualcomm collects those royalties, and also its policy of only selling its chipsets to customers who pay the patent fees, the company said. In addition, Chinese authorities are also looking into allegations of whether the company refused to grant patent licenses to certain chip manufacturers.
Qualcomm could face a fine of more than $1 billion in China.
"Our results were negatively impacted by the challenges we are facing in China," Qualcomm said Wednesday in its fiscal fourth quarter earnings report. It added that certain unlicensed clients in China are delaying business with Qualcomm because of NDRC’s investigation.
"We're continuing to cooperate with the NDRC. We’ve continued to meet with them regularly, exchange some ideas for potential ways to resolve it," Qualcomm President Derek Aberle said."
Qualcomm also said it faces a new probe by the European Commission about rebates and other financial incentives in the sale of its chips. Another preliminary investigation by the U.S. Federal Trade Commission concerns a potential breach of licensing terms, the company said.
Qualcomm said it was difficult to predict the outcome of the U.S. and European investigations.
Seperately, a subsidiary of Nvidia has filed a complaint to the European Commission over alleged patent-related incentives and exclusionary pricing by Qualcomm.
Qualcomm forecast revenue for fiscal 2015 of between $26.8 billion and $28.8 billion. The company also expects non-GAAP earnings per share in fiscal 2015 to be between $5.05 and $5.35. Analysts on average expected $5.58.