Better Tech Buy Today: Intel or Qualcomm?

The global semiconductor market is one of the most important areas in all of tech. Despite its size, it remains a somewhat fragmented, divergent market. At the top of the food chain resides Intel (NASDAQ: INTC  ) , whose fortunes have faded lately with the rise of the mobile revolution. And riding that same wave to great success is Qualcomm (NASDAQ: QCOM  ) . These are clearly companies with very different recent pasts. In the video below, analyst Brendan Byrnes asks Fool contributor Andrew Tonner which remains the better potential buy for investors today.

It's incredible to think just how much of our digital and technological lives are almost entirely shaped and molded by just a handful of companies. Find out "Who Will Win the War Between the 5 Biggest Tech Stocks?" in The Motley Fool's latest free report, which details the knock-down, drag-out battle being waged by the five kings of tech. Click here to keep reading.


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  • Report this Comment On June 14, 2013, at 7:32 AM, stretcho44 wrote:

    I am long INTC and QCOM and like them both. QCOM would be more profitable if they stopped shipping chips and just let QTL rake in the money.

    Year ending Sept 30, 2012, the corporation revenue table on 10K, page 35 says that Qualcomm had:

    2012 REVENUES (millions)

    Equipment and services of $12,465

    Licensing $6,656

    Total $19,121

    2011 REVENUE (millions)

    Equipment and services of $9,223

    Licensing $5,534

    Total $14,957

    2010 REVENUE (millions)

    Equipment and services of $6,971

    Licensing $4,011

    Total $10,982

    STILL ON 10K page 25:

    "The increases in equipment and services revenues in fiscal 2012 and 2011 were primarily due to increases in QCT revenues of $3.25 billion and $2.18 billion, respectively. The increases in licensing revenues in fiscal 2012 and 2011 were primarily due to increases in QTL revenues of $905 million and $1.76 billion, respectively."

    The QCOM 10k indicates that QCT was responsible for revenue increases of $3,25 billion and $2.18 billion. 2010 to 2011 revenue increase was $2,252 and QCT was responsible for $2,180 or 96% of the 2011 revenue increase. QCT was responsible for $3,250 of the $3,242 increase in 2012. There was only a $3,242 mill increase from 2011 to 2012 but QCT was responsible for more than that or about 100% assuming rounding errors in the 10k.

    QCT is responsible for 96% (2011) and 100% (2012) revenue increases. SOURCE: QCOM 10k page 35 PARAGRAPH 5 (not counting table).

    The QCOM 10k indicates that QTL is responsible for licensing revenue increases of $0.905 billion and $1.76 billion.

    2012 -> 2011 <- 2010

    $6,656 $5,734 $4,011 Licensing

    $922 $1,723 N/A YoY Licensing increase computed

    $905 $1,760 N/A QTL Licensing increase from 10k page 35

    $905 is 98% of $922 ... QTL was responsible for 98% of licensing increase

    $1,760 is 102% of $1,723 ....QTL was responsible for 102% of licensing increase

    NOTE that when QTL is responsible for > 100% increase, all it means is that the revenue stream from one of the 3 other QCOM segments dropped.

    QTL is responsible for Licensing revenue

    My complete thought is:

    QCT sells chips and not much licensing.

    QTL collects license fees.

    My thought is that ....

    the Qualcomm "Licensing" revenue in their SEC Form 10k page 35 is larger than the Qualcomm corporate INCOME.

    Increases in LICENSING REVENUE over the last 3 years has been ~100% from QTL. 10K page 35.

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