Qualcomm (NAS:QCOM) Operating Income

: $14,461 Mil (TTM As of Dec. 2022)

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Qualcomm's Operating Income for the three months ended in Dec. 2022 was $2,465 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Dec. 2022 was $14,461 Mil.

Operating Margin % is calculated as Operating Income divided by its Revenue. Qualcomm's Operating Income for the three months ended in Dec. 2022 was $2,465 Mil. Qualcomm's Revenue for the three months ended in Dec. 2022 was $9,463 Mil. Therefore, Qualcomm's Operating Margin % for the quarter that ended in Dec. 2022 was 26.05%.

Good Sign:

Qualcomm Inc operating margin is expanding. Margin expansion is usually a good sign.

Qualcomm's 5-Year average Growth Rate for Operating Margin % was 43.20% per year.

Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition. Qualcomm's annualized ROC % for the quarter that ended in Dec. 2022 was 25.47%. Qualcomm's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2022 was 115.76%.

Qualcomm Operating Income Historical Data

The historical data trend for Qualcomm's Operating Income can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Qualcomm Annual Data

Trend

Sep13

Sep14

Sep15

Sep16

Sep17

Sep18

Sep19

Sep20

Sep21

Sep22

Operating Income

621.00

7,667.00

6,255.00

9,789.00

15,860.00

Qualcomm Quarterly Data
	Mar18	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22
Operating Income																3,864.00	3,858.00	3,413.00	4,725.00	2,465.00

Qualcomm Operating Income Calculation

Operating Income, is the profit a company earned through operations. All expenses, including cash expenses such as cost of goods sold (COGS), research & development, wages, and non-cash expenses, such as depreciation, depletion and amortization, have been deducted from the sales.

Operating Income for the trailing twelve months (TTM) ended in Dec. 2022 adds up the quarterly data reported by the company within the most recent 12 months, which was $14,461 Mil.

Qualcomm (NAS:QCOM) Operating Income Explanation

1. Operating Income or EBIT is linked to Return on Capital for both regular definition and Joel Greenblatt's definition.

Qualcomm's annualized ROC % for the quarter that ended in Dec. 2022 is calculated as:

	ROC % (Q: Dec. 2022 )
=	NOPAT	/	Average Invested Capital
=	Operating Income * ( 1 - Tax Rate % )	/	( (Invested Capital (Q: Sep. 2022 )	+	Invested Capital (Q: Dec. 2022 ))	/ count )
=	9860 * ( 1 - 4.13% )	/	( (36471	+	37754)	/ 2 )
=	9452.782	/	37112.5
=	25.47 %

where

	Invested Capital		(Q: Sep. 2022 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	49014	-	6161	-	( 6382	-	max(0, 11866	-	20724	+	6382	))
=	36471

	Invested Capital		(Q: Dec. 2022 )
=	Total Assets	-	Accounts Payable & Accrued Expense	-	Excess Cash
=	Total Assets	-	Accounts Payable & Accrued Expense	-	( Cash, Cash Equivalents, Marketable Securities	-	max(0, Total Current Liabilities	-	Total Current Assets	+	Cash, Cash Equivalents, Marketable Securities	))
=	50014	-	4022	-	( 8238	-	max(0, 10081	-	21098	+	8238	))
=	37754

Note: The Operating Income data used here is four times the quarterly (Dec. 2022) data.

2. Joel Greenblatt's definition of Return on Capital:

Qualcomm's annualized ROC (Joel Greenblatt) % for the quarter that ended in Dec. 2022 is calculated as:

	ROC (Joel Greenblatt) %		(Q: Dec. 2022 )
=	EBIT	/	Average of (Net fixed Assets	+	Net Working Capital)
=	EBIT	/	Average of (Property, Plant and Equipment	+	Net Working Capital)
			Q: Sep. 2022		Q: Dec. 2022
=	EBIT	/	( ( (Property, Plant and Equipment + Net Working Capital)	+	(Property, Plant and Equipment + Net Working Capital) )	/	count )
=	10164	/	( ( (5168 + max(2953, 0))	+	(5215 + max(4225, 0)) )	/	2 )
=	10164	/	( ( 8121	+	9440 )	/	2 )
=	10164	/	8780.5
=	115.76 %

where Working Capital is:

	Working Capital		(Q: Sep. 2022 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(4175	+	6341	+	2358)	-	(6161	+	369	+	3391)
=	2953

	Working Capital		(Q: Dec. 2022 )
=	(Accounts Receivable	+	Total Inventories	+	Other Current Assets)	-	(Accounts Payable & Accrued Expense	+	Defer. Rev.	+	Other Current Liabilities)
=	(3960	+	6932	+	1968)	-	(4022	+	289	+	4324)
=	4225

When net working capital is negative, 0 is used.

Note: The EBIT data used here is four times the quarterly (Dec. 2022) EBIT data.

3. Operating Income is also linked to Operating Margin %:

Qualcomm's Operating Margin % for the quarter that ended in Dec. 2022 is calculated as:

Operating Margin %	=	Operating Income (Q: Dec. 2022 )	/	Revenue (Q: Dec. 2022 )
	=	2465	/	9463
	=	26.05 %

4. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the Operating Income growth rate using Operating Income per share data.

Be Aware

Compared with a company's EBITDA margin, Operating Margin can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin may decline. Often the Operating Margin declines well before the company's revenue or even profit decline. Therefore, Operating Margin is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia's Operating Margin had already been in decline since 2002, although its earnings per share were still rising. Investors who paid attention to Operating Margin would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.

Qualcomm Operating Income Related Terms

Thank you for viewing the detailed overview of Qualcomm's Operating Income provided by GuruFocus.com. Please click on the following links to see related term pages.

Qualcomm (NAS:QCOM) Business Description

Industry

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Address

5775 Morehouse Drive, San Diego, CA, USA, 92121-1714

Website

https://www.qualcomm.com

Qualcomm develops and licenses wireless technology and designs chips for smartphones. The company's key patents revolve around CDMA and OFDMA technologies, which are standards in wireless communications that are the backbone of all 3G and 4G networks. The firm is a leader in 5G network technology as well. Qualcomm's IP is licensed by virtually all wireless device makers. The firm is also the world's largest wireless chip vendor, supplying nearly every premier handset maker with leading-edge processors. Qualcomm also sells RF-front end modules into smartphones and chips into automotive and Internet of Things markets.

Executives

Neil Martin	officer: SVP, Finance and CAO	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
James J Cathey	officer: Chief Commercial Officer	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
Ann C Chaplin	officer: General Counsel&Corp Secretary	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
Sylvia Acevedo	director	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
Gregory N Johnson	director	C/O INTUIT INC., 2700 COAST AVENUE, MOUNTAIN VIEW CA 94043
Jean-pascal Tricoire	director	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
Jamie S Miller	director	GENERAL ELECTRIC COMPANY, 5 NECCO STREET, BOSTON MA 02210
Heather S Ace	officer: EVP, Human Resources	3721 VALLEY CENTRE DR SUITE 500, SAN DIEGO CA 92130
Akash J. Palkhiwala	officer: SVP & Interim CFO	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
David Wise	officer: Interim CFO	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
Erin L Polek	officer: SVP Corporate Controller & CAO	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
Martin B Anstice	director	4650 CUSHING PARKWAY, FREMONT CA 94538
Irene B Rosenfeld	director	999 VANDERBILT BEACH ROAD, SUITE 601, NAPLES FL 34108
Steven M Mollenkopf	director, officer: Chief Executive Officer	5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121
Neil Smit	director	C/O AMERICA ONLINE LATIN AMERICA, INC., 6600 N. ANDREWS AVE., SUITE 400, FT. LAUDERDALE FL 33309