Stock Analysis on Net

Qualcomm Inc. (NASDAQ:QCOM)

Analysis of Income Taxes

Microsoft Excel

Income Tax Expense (Benefit)

Qualcomm Inc., income tax expense (benefit), continuing operations

US$ in millions

Microsoft Excel
12 months ended: Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Federal 1,229 1,114 942 210 1,563 2,559
State 10 1 8 1 2 (1)
Foreign 491 906 518 526 (407) 777
Current provision 1,730 2,021 1,468 737 1,158 3,335
Federal (1,475) (34) (251) (192) 2,037 1,867
State (8) 15 2 2 17 1
Foreign (143) 10 12 (26) (117) 174
Deferred provision (benefit) (1,626) (9) (237) (216) 1,937 2,042
Income tax provision from continuing operations 104 2,012 1,231 521 3,095 5,377

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Item Description The company
Current provision Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. Qualcomm Inc. current provision increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.
Deferred provision (benefit) Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Qualcomm Inc. deferred provision (benefit) increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.
Income tax provision from continuing operations Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Qualcomm Inc. income tax provision from continuing operations increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.

Effective Income Tax Rate (EITR)

Qualcomm Inc., effective income tax rate (EITR) reconciliation

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Federal statutory tax rate 21.00% 21.00% 21.00% 21.00% 21.00% 24.76%
Effective tax rate, excluding U.S. tax reform 1.00% 13.00% 12.00% 9.00% 41.37% 27.49%
Effective tax rate 1.00% 13.00% 12.00% 9.00% 41.37% 1,048.15%

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Item Description The company
Effective tax rate, excluding U.S. tax reform Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Qualcomm Inc. effective tax rate, excluding U.S. tax reform increased from 2021 to 2022 but then decreased significantly from 2022 to 2023.

Components of Deferred Tax Assets and Liabilities

Qualcomm Inc., components of deferred tax assets and liabilities

US$ in millions

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Unused tax credits 1,819 1,624 1,504 1,311 1,137 1,044
Capitalized research and development expenditures 1,490
Customer incentives 659 807 762 537
Accrued liabilities and reserves 401 264 483 275 648 396
Unused net operating losses 364 887 663 576 619 696
Share-based compensation 285 225 175 151 115 97
Operating lease liabilities 216 202 188 107
Unrealized losses on other investments and marketable securities 159 197 106 235 164 126
Other 409 435 346 403 520 472
Gross deferred tax assets 5,802 4,641 4,227 3,595 3,203 2,831
Valuation allowance (1,803) (2,223) (1,926) (1,728) (1,672) (1,529)
Net deferred tax assets 3,999 2,418 2,301 1,867 1,531 1,302
Intangible assets (335) (315) (198) (181) (216) (322)
Operating lease assets (194) (184) (174) (100)
Unrealized gains on other investments and marketable securities (101) (84) (215) (97) (99) (26)
Property, plant and equipment (52) (101) (111) (162) (102) (49)
Accrued revenues (202)
Other (118) (98) (76) (32) (21) (90)
Deferred tax liabilities (800) (782) (774) (572) (438) (689)
Net deferred tax assets (liabilities) 3,199 1,636 1,527 1,295 1,093 613

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Item Description The company
Gross deferred tax assets Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Qualcomm Inc. gross deferred tax assets increased from 2021 to 2022 and from 2022 to 2023.
Net deferred tax assets Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Qualcomm Inc. net deferred tax assets increased from 2021 to 2022 and from 2022 to 2023.
Net deferred tax assets (liabilities) Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. Qualcomm Inc. net deferred tax assets (liabilities) increased from 2021 to 2022 and from 2022 to 2023.

Deferred Tax Assets and Liabilities, Classification

Qualcomm Inc., deferred tax assets and liabilities, classification

US$ in millions

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Non-current deferred tax assets 3,310 1,803 1,591 1,351 1,196 904
Non-current deferred tax liabilities (included in Other liabilities) 111 167 64 56 103 291

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Item Description The company
Non-current deferred tax assets Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent. Qualcomm Inc. non-current deferred tax assets increased from 2021 to 2022 and from 2022 to 2023.
Non-current deferred tax liabilities (included in Other liabilities) Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent. Qualcomm Inc. non-current deferred tax liabilities (included in Other liabilities) increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.

Adjustments to Financial Statements: Removal of Deferred Taxes

Qualcomm Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Adjustment to Total Assets
Total assets (as reported) 51,040 49,014 41,240 35,594 32,957 32,686
Less: Noncurrent deferred tax assets, net 3,310 1,803 1,591 1,351 1,196 904
Total assets (adjusted) 47,730 47,211 39,649 34,243 31,761 31,782
Adjustment to Total Liabilities
Total liabilities (as reported) 29,459 31,001 31,290 29,517 28,048 31,758
Less: Noncurrent deferred tax liabilities, net 111 167 64 56 103 291
Total liabilities (adjusted) 29,348 30,834 31,226 29,461 27,945 31,467
Adjustment to Stockholders’ Equity
Stockholders’ equity (as reported) 21,581 18,013 9,950 6,077 4,909 928
Less: Net deferred tax assets (liabilities) 3,199 1,636 1,527 1,295 1,093 613
Stockholders’ equity (adjusted) 18,382 16,377 8,423 4,782 3,816 315
Adjustment to Net Income (loss)
Net income (loss) (as reported) 7,232 12,936 9,043 5,198 4,386 (4,864)
Add: Deferred income tax expense (benefit) (1,626) (9) (237) (216) 1,937 2,042
Net income (loss) (adjusted) 5,606 12,927 8,806 4,982 6,323 (2,822)

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).


Qualcomm Inc., Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Qualcomm Inc., adjusted financial ratios

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
Net Profit Margin
Reported net profit margin 20.19% 29.27% 26.94% 22.09% 18.07% -21.40%
Adjusted net profit margin 15.65% 29.25% 26.23% 21.17% 26.05% -12.41%
Total Asset Turnover
Reported total asset turnover 0.70 0.90 0.81 0.66 0.74 0.70
Adjusted total asset turnover 0.75 0.94 0.85 0.69 0.76 0.72
Financial Leverage
Reported financial leverage 2.37 2.72 4.14 5.86 6.71 35.22
Adjusted financial leverage 2.60 2.88 4.71 7.16 8.32 100.90
Return on Equity (ROE)
Reported ROE 33.51% 71.81% 90.88% 85.54% 89.35% -524.14%
Adjusted ROE 30.50% 78.93% 104.55% 104.18% 165.70% -895.87%
Return on Assets (ROA)
Reported ROA 14.17% 26.39% 21.93% 14.60% 13.31% -14.88%
Adjusted ROA 11.75% 27.38% 22.21% 14.55% 19.91% -8.88%

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Qualcomm Inc. adjusted net profit margin ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Qualcomm Inc. adjusted total asset turnover ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Qualcomm Inc. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Qualcomm Inc. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Qualcomm Inc. adjusted ROA improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Qualcomm Inc., Financial Ratios: Reported vs. Adjusted


Adjusted Net Profit Margin

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) 7,232 12,936 9,043 5,198 4,386 (4,864)
Revenues 35,820 44,200 33,566 23,531 24,273 22,732
Profitability Ratio
Net profit margin1 20.19% 29.27% 26.94% 22.09% 18.07% -21.40%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) 5,606 12,927 8,806 4,982 6,323 (2,822)
Revenues 35,820 44,200 33,566 23,531 24,273 22,732
Profitability Ratio
Adjusted net profit margin2 15.65% 29.25% 26.23% 21.17% 26.05% -12.41%

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 Net profit margin = 100 × Net income (loss) ÷ Revenues
= 100 × 7,232 ÷ 35,820 = 20.19%

2 Adjusted net profit margin = 100 × Adjusted net income (loss) ÷ Revenues
= 100 × 5,606 ÷ 35,820 = 15.65%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Qualcomm Inc. adjusted net profit margin ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Adjusted Total Asset Turnover

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in millions)
Revenues 35,820 44,200 33,566 23,531 24,273 22,732
Total assets 51,040 49,014 41,240 35,594 32,957 32,686
Activity Ratio
Total asset turnover1 0.70 0.90 0.81 0.66 0.74 0.70
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Revenues 35,820 44,200 33,566 23,531 24,273 22,732
Adjusted total assets 47,730 47,211 39,649 34,243 31,761 31,782
Activity Ratio
Adjusted total asset turnover2 0.75 0.94 0.85 0.69 0.76 0.72

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 Total asset turnover = Revenues ÷ Total assets
= 35,820 ÷ 51,040 = 0.70

2 Adjusted total asset turnover = Revenues ÷ Adjusted total assets
= 35,820 ÷ 47,730 = 0.75

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Qualcomm Inc. adjusted total asset turnover ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in millions)
Total assets 51,040 49,014 41,240 35,594 32,957 32,686
Stockholders’ equity 21,581 18,013 9,950 6,077 4,909 928
Solvency Ratio
Financial leverage1 2.37 2.72 4.14 5.86 6.71 35.22
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted total assets 47,730 47,211 39,649 34,243 31,761 31,782
Adjusted stockholders’ equity 18,382 16,377 8,423 4,782 3,816 315
Solvency Ratio
Adjusted financial leverage2 2.60 2.88 4.71 7.16 8.32 100.90

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 Financial leverage = Total assets ÷ Stockholders’ equity
= 51,040 ÷ 21,581 = 2.37

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted stockholders’ equity
= 47,730 ÷ 18,382 = 2.60

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Qualcomm Inc. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Equity (ROE)

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) 7,232 12,936 9,043 5,198 4,386 (4,864)
Stockholders’ equity 21,581 18,013 9,950 6,077 4,909 928
Profitability Ratio
ROE1 33.51% 71.81% 90.88% 85.54% 89.35% -524.14%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) 5,606 12,927 8,806 4,982 6,323 (2,822)
Adjusted stockholders’ equity 18,382 16,377 8,423 4,782 3,816 315
Profitability Ratio
Adjusted ROE2 30.50% 78.93% 104.55% 104.18% 165.70% -895.87%

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 ROE = 100 × Net income (loss) ÷ Stockholders’ equity
= 100 × 7,232 ÷ 21,581 = 33.51%

2 Adjusted ROE = 100 × Adjusted net income (loss) ÷ Adjusted stockholders’ equity
= 100 × 5,606 ÷ 18,382 = 30.50%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Qualcomm Inc. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Sep 24, 2023 Sep 25, 2022 Sep 26, 2021 Sep 27, 2020 Sep 29, 2019 Sep 30, 2018
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) 7,232 12,936 9,043 5,198 4,386 (4,864)
Total assets 51,040 49,014 41,240 35,594 32,957 32,686
Profitability Ratio
ROA1 14.17% 26.39% 21.93% 14.60% 13.31% -14.88%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) 5,606 12,927 8,806 4,982 6,323 (2,822)
Adjusted total assets 47,730 47,211 39,649 34,243 31,761 31,782
Profitability Ratio
Adjusted ROA2 11.75% 27.38% 22.21% 14.55% 19.91% -8.88%

Based on: 10-K (reporting date: 2023-09-24), 10-K (reporting date: 2022-09-25), 10-K (reporting date: 2021-09-26), 10-K (reporting date: 2020-09-27), 10-K (reporting date: 2019-09-29), 10-K (reporting date: 2018-09-30).

2023 Calculations

1 ROA = 100 × Net income (loss) ÷ Total assets
= 100 × 7,232 ÷ 51,040 = 14.17%

2 Adjusted ROA = 100 × Adjusted net income (loss) ÷ Adjusted total assets
= 100 × 5,606 ÷ 47,730 = 11.75%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Qualcomm Inc. adjusted ROA improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.