Qualcomm’s profit halved due to South Korean competition authority fine

Qualcomm’s profit for the quarter was 54 percent lower than in the same quarter a year earlier. That’s because of the Korean Won 1.03 trillion fine imposed for obstructing competition and violating patent regulations.

Qualcomm deducts the fine from its profits for the past quarter and therefore profits are $868 million lower. The turnover of the American chip designer amounted to 6 billion dollars, four percent more than a year earlier. The net profit after deduction of the fine is 700 million dollars, converted about 650 million euros.

Qualcomm sold 217 million chips in the quarter. Ten percent less than a year earlier. The American company wants to grow again, partly through the acquisition of NXP, for which Qualcomm pays 43 billion euros. The acquisition is expected to be completed by the end of this year.

The company emphasizes in the presentation of the quarterly figures that it is challenging the South Korean fine. The fine was imposed by the SKFTC because Qualcomm is violating patent regulations and forcing manufacturers to license if they use certain chips. According to the authorities, the American company also does not pay a fair fee for patents from other smartphone makers.

Last week, it was announced that the United States Federal Trade Commission also filed a complaint against Qualcomm, alleging the company misused its network chip patents and engaged in unfair business practices. Apple then sued Qualcomm, demanding $1 billion from the chip designer.

Two investigations into Qualcomm’s business practices are also underway in Europe. In a preliminary conclusion, the European Commission stated that Qualcomm has illegally paid manufacturers for exclusive purchase of its chipsets. No fine has yet been imposed in this case, but it could follow if Qualcomm fails to refute the allegations.