San Diego-based Qualcomm, one of the world’s largest manufacturers of computer chips, said Feb. 9 it will pay a $975 million fine as part of a long-awaited settlement with Chinese antitrust authorities. The penalty also includes several changes to Qualcomm’s practices in licensing patents for mobile phones sold in China.
Qualcomm, which sells more smartphone chips than any other manufacturer, makes most of its profit from patent royalties paid by handset makers that use its chips. China recently accounted for roughly half the company’s revenue, which totaled $26.5 billion in the fiscal year that ended in September.
China’s National Development and Reform Commission, which has been investigating the company since November of 2013, found that Qualcomm violated the country’s antimonopoly law, the company said. Qualcomm officials said they are disappointed in that finding, which has not yet been released in detail, but agreed not to contest it in further legal proceedings.
The changes Qualcomm agreed to were much less severe than some analysts expected. In fact, Qualcomm boosted its estimates for revenue and profit excluding the fine in the current fiscal year as a result of the settlement.