Qualcomm shares sink 12% after US antitrust ruling
Chipmaker Qualcomm saw its shares sink more than 12 percent in premarket trading Wednesday after a US federal judge ruled that the company violated antitrust lawd.
US District Judge Lucy Koh ordered Qualcomm to change its pricing and sales practices, after finding it "engaged in anticompetitive conduct" toward customers like China's Huawei, Samsung and Sony.
"Qualcomm's licensing practices have strangled competition" in the chip market for years, "and harmed rivals," she added.
The southern California-based company's shares had soared after reaching a settlement with Apple last month over royalty payments for chips used in smartphones, which was expected to generate a $4.5 billion windfall.
But the 230-page ruling showed the company violated Federal Trade Commission laws by using "unfair methods of competition."
The company said it will seek an expedited appeal of the ruling.
"We strongly disagree with the judge's conclusions, her interpretation of the facts and her application of the law," Qualcomm executive vice president and general counsel Don Rosenberg said in a statement.
Koh cited statements from company executives showed the "unlawful practices are 'ongoing' or likely to recur" since they were part of the firm's strategy and it maintains a dominant position in the market.
Among the actions ordered, the judge said she would "prohibit Qualcomm from discriminating or retaliating in any way against any modem-chip customer or modem-chip supplier because of a dispute with Qualcomm over license terms or because of a customer's license status."
? 2019 AFP