Qualcomm just had its earnings call, and CEO Steve Mollenkopf and Derek Aberle, head of the wireless chipmakers’s licensing business, couldn’t stop talking about Apple.
In a one-hour conference call, discussion about the developing Apple/Qualcomm dispute took up the entire first 20 minutes.
“If you peel apart all of the arguments Apple’s making, we believe firmly they’re all without merit,” Aberle said. “At the end of the day, they essentially want to pay less for the technology they’re using. It’s pretty simple.”
Qualcomm reported its fiscal Q1 income attributable to shareholders had dropped to $682 million from $1.5 billion, or 99 cents a share — with an $850 million fine from South Korea playing a role in the loss. In after-hours trading, Qualcomm shares fell to $55.09, meaning that Qualcomm stock has lost around 14 percent of its value since the company was hit by an Apple lawsuit last week.
Steve Mollenkopf, however, was keen to reassure investors. “I’m confident we’ll address and get through the legal challenges underway, as we have done many times in the past,” he said.
Apple’s U.S. lawsuit against Qualcomm relates to the fees Qualcomm charges for use of its licenses, which Apple says amounts to, “at least five times more in payments than all the other cellular patent licensors we have agreements with combined.”
It has also filed a lawsuit against Qualcomm in China seeking $145 million, claiming that Qualcomm used its dominant position as a communication chips supplier to squeeze extra cash out of companies.
Qualcomm is reportedly considering countersuing Apple, although no details have yet been released.
Despite the legal battle between the two companies, it is thought that it won’t stop Qualcomm supplying Apple with modem chips for the iPhone. Since both companies benefit from the agreement (despite Apple’s insistence that Qualcomm charges way too much for the technology), that deal is set to continue for the immediate future.