The US Federal Trade Commission and Apple have sued Qualcomm accusing it of resorting to “anticompetitive” tactics to maintain a monopoly over chips used in smartphone.
The Apple tactic appears to be designed to force Qualcomm to reduce its already discounted pricing by jumping on the bandwagon of anti-trust actions in the US and Korea.
The fruity cargo cult also filed a lawsuit against Qualcomm in Beijing, alleging that the chip supplier abused its clout and is seeking $145.32 million in damages.
Qualcomm executives firmly defended the company’s licensing model on its quarterly conference call, and said its revenue forecast did not include any impact from the dispute with Apple.
Qualcomm president Derek Aberle said that Apple’s attack on Qualcomm’s business model is not only an attack on Qualcomm, but also an attack on the smartphone competition that Qualcomm’s business model enables.
Qualcomm said it expects to continue to supply to Apple during the dispute, and that the company’s contracts with the iPhone maker’s suppliers were still valid.
Analysts on average were expecting a profit of $1.20 per share and revenue of $5.90 billion so they are slightly disappointed.
Revenue rose to $6 billion from $5.78 billion, but missed analysts’ estimate of $6.12 billion.
Qualcomm’s shares have risen nearly 20 percent in the past 12 months, compared with the 62.1 percent gain in the broader Philadelphia Semiconductor index.