QUALCOMM Reports Third Fiscal Quarter Revenues of $1

Billion / Operating Earnings Per Share of $.75, Excluding Non-Recurring Charges SAN DIEGO (PROTEXT) - All of the Share and Per-Share Amountsin this Release Have Been Adjusted To Reflect the 2:1 StockDistribution that was Paid May 10, 1999 To QUALCOMM Stockholdersof Record on April 21, 1999. QUALCOMM Incorporated (Nasdaq: QCOM) today reported revenuesof $1 billion and net income of $59 million, or $.35 per share(diluted), for the third quarter of fiscal 1999 (see FinancialData comparisons, pg. 6). Excluding non-recurring charges of $117million associated primarily with the sale of the Company'sterrestrial Code Division Multiple Access (CDMA) wirelessinfrastructure business, the Company reported record net incomein the third quarter of $135 million, or $.75 earnings per share(diluted). This represents an increase in net income, excludingnon-recurring items, of 445 percent over the third quarter offiscal 1998. Revenues in the third quarter of fiscal 1999increased 15 percent over revenues of $875 million for the yearago quarter. This revenue growth was due to increasedcommunications systems revenues consisting of sales ofApplication Specific Integrated Circuits (ASICs), OmniTRACS unitsand CDMA phones, as well as a significant increase in royalties. "We are pleased to report very strong third fiscal quarterresults. Revenues reached the billion dollar mark and we hadrecord net income," said Dr. Irwin Mark Jacobs, chairman and CEOof QUALCOMM Incorporated. "We achieved several importantmilestones this quarter, including closing the sale of theterrestrial CDMA wireless infrastructure business, attaining thenumber two position in digital phone market share in the U.S.(according to Dataquest), and shipping over 11 million MSM chipsto CDMA phone manufacturers worldwide. We are also pleased tohave been selected for inclusion in the S&P 500 index." Pro Forma Results (Excluding Infrastructure Business and Non-Recurring Charges) Pro forma financial information is provided for the purpose ofevaluating what the Company's operating results would have beenexcluding both non-recurring charges and operating results of theterrestrial CDMA wireless infrastructure business. For the thirdquarter of fiscal 1999, pro forma revenues were $966 million, proforma gross profit was 42 percent, pro forma net income was $154million, and pro forma earnings per share were $.86 (diluted). Non-recurring pre-tax charges of $117 million were reported inconnection with the sale of the terrestrial CDMA wirelessinfrastructure business (primarily employee-related costs) andincluding the write-down of certain infrastructure businessrelated assets not being acquired. Highlights of Financial Performance Communications Systems Communications systems revenues increased 9 percent to $824million in the third quarter of fiscal 1999 from $759 million inthe year ago quarter, with increased sales of ASICs, OmniTRACSunits and CDMA phones. Communications systems revenues in thethird quarter of fiscal 1998 included significantly higherrevenues from Globalstar gateways, terrestrial CDMA wirelessinfrastructure products and QUALCOMM Personal Electronics (QPE)sales to Sony. Excluding these items in the year ago quarter,revenue growth would have been 49 percent. Communications systemsgross margin for the third quarter of fiscal 1999 was 35 percentcompared to 24 percent in the third quarter of fiscal 1998,reflecting improved margins in all product areas with theexception of infrastructure products. Total CDMA phone shipments for the third fiscal quarter of1999 were over 1.7 million units (cumulatively over 12 million).Component shortages limited production growth and marginimprovement of the Company's phone products in the third fiscalquarter of 1999. These shortages are expected to continue andcould affect the Company's results in the fourth fiscal quarterof 1999. Total MSM phone chip shipments for the third quarter offiscal 1999 were over 11 million units (cumulatively over 50million). In addition to substantial growth in the shipment ofMSM phone chips, the book-to-bill ratio for the ASICs businesswas 1.2 for the third quarter of fiscal 1999. The book-to-billratio means the Company has $1.20 in ASICs orders for every $1.00of product shipped. Total OmniTRACS shipments were approximately12 thousand units (cumulatively over 290,000). License, Royalty and Development Fees License, royalty and development fees for the third quarter offiscal 1999 were $93 million, including $6 million of licensefees, compared to $77 million last quarter and $47 million forthe year ago quarter. Contract Services Contract services revenues were $88 million in the thirdquarter of fiscal 1999 compared to $70 million for the year agoquarter. The increase in revenues was attributable to thedevelopment agreement with Globalstar, the activities of whichare expected to decline in future quarters. Operating Income/Expenses Operating income excluding non-recurring charges more thanquadrupled, increasing 303 percent to $215 million in the thirdquarter of fiscal 1999 compared to $53 million during the yearago quarter. The increase was attributable to higher revenues andimproved gross margins in all product areas with the exception ofinfrastructure products. Operating income as a percent ofrevenues more than tripled, increasing to 21 percent for thethird quarter of fiscal 1999 from 6 percent in the year agoquarter. Operating expenses (research and development, sellingand marketing and general and administrative) excluding non-recurring charges for the third quarter of fiscal 1999 decreasedto 20 percent of revenues compared to 23 percent of revenuesduring the year ago quarter. Taxes The Company's effective tax rate for fiscal 1999 is currentlyestimated to be 35 percent compared to an effective tax rate of30 percent in fiscal 1998. The effective tax rate for fiscal 2000may increase as a result of higher earnings relative toinvestment tax credits. QUALCOMM Incorporated (www.qualcomm.com) is a leader indeveloping and delivering innovative digital wirelesscommunications products and services based on the Company's CDMAdigital technology. The Company's major business areas includeCDMA phones; integrated CDMA chipsets and system software;technology licensing; and satellite-based systems includingOmniTRACS(R) and portions of the Globalstar(TM) system.Headquartered in San Diego, Calif., QUALCOMM is a FORTUNE 500(R)company traded on Nasdaq under the ticker symbol QCOM. Except for the historical information contained herein, thisnews release contains forward-looking statements that are subjectto risks and uncertainties. Actual results may differsubstantially from those referred to herein due to a number offactors, including but not limited to the risk that the rate ofgrowth in the CDMA subscriber population will decrease; risksassociated with the scale-up and operations of CDMA systems;risks associated with component shortages; risks associated withthe ability to sustain or improve operational efficiency andprofitability; risks associated with developments in current orfuture litigation; risks related to customer receivables andperformance guarantees; risks associated with timing and receiptof license fees and royalties; risks associated with strategicopportunities or acquisitions the Company may pursue; risksassociated with international business activities; risksassociated with changes in economic conditions of the variousmarkets the Company serves, as well as the other risks detailedfrom time to time in the Company's SEC reports. QUALCOMM, OmniTRACS and Eudora are registered trademarks ofQUALCOMM Incorporated. MSM and Thin Phone are trademarks ofQUALCOMM Incorporated. Globalstar is a trademark of LoralQUALCOMM Satellite Services, Incorporated. All other trademarksare the property of their respective manufacturers. Financial Data -- Third Quarter Fiscal 1999

1999 1999 Dollars in thousands

3rd Qtr

Non-Recurring3rdQtr except per share data

As Reported

Charges

AsAdjusted Revenue

$1,004,066

--$1,004,066 Gross Profit

406,399

$(6,180) 412,579 Gross Profit %

40%

-- 41% R&D

93,791

-- 93,791 Selling & Marketing

50,460

200 50,260 G&A

54,424

1,162 53,262 Other Operating Expenses

109,345

109,345 -- Total Operating Expenses

308,020

110,707 197,313 Operating Income

98,379

(116,887) 215,266 Operating Income %

10%

-- 21% Other Non-Operating Expense

7,690

-- 7,690 Income (Loss) Before Taxes

90,689

$(116,887) 207,576 Net Income

58,948

-- 134,924 EPS (Diluted)

$0.35

-- $0.75 Financial Data -- Third Quarter Fiscal 1999 vs. Third QuarterFiscal 1998 Excluding Non-Recurring Charges/Gains Dollars in thousands except per 1999

1998

Change

1999

1998Change share data 3rd Qtr

3rd Qtr %

9 months

9 months % Revenue

$1,004,066 $875,497 15% $2,877,684 $2,421,90419% Gross Profit

412,579 250,817 64% 1,030,155

709,27745% Gross Profit %

41%

29% --

36%

29% -- Operating Income

215,266 53,353 303%

408,537

169,525 141% Operating Income %

21%

6%

--

14%

7% -- Income Before Taxes

207,576 33,766

515%

318,063

129,741145% Net Income

134,924 24,740

445%

208,741

96,883115% EPS (Diluted)

$0.75 $0.17

341%

$1.29

$0.6695% Note: 35% effective tax rate has been assumed for fiscal year1999 number presentations. ots Original Text Service: QUALCOMMIncorporated Internet: http://www.newsaktuell.de Contact: JulieCunningham, Vice President, Investor Relations of QUALCOMMIncorporated, 858-658-4224, or fax, 858-651-9303,juliec@qualcomm.com Web site: http://www.qualcomm.com

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