Qualcomm 2005 Annual Report Download - page 67
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Available-for-sale securities were comprised as follows (in millions):
Unrealized Unrealized Fair
Cost Gains Losses Value
September 25, 2005
Equity securities $1,353 $131 $(29) $1,455
Debt securities 5,039 14 (27) 5,026
Total $6,392 $145 $(56) $6,481
September 26, 2004
Equity securities $1,003 $ 77 $(19) $1,061
Debt securities 5,208 27 (15) 5,220
Total $6,211 $104 $(34) $6,281
The fair values of held-to-maturity debt securities at September 25,
2005 and September 26, 2004 approximate cost.
The Company recorded realized gains and losses on sales of available-
for-sale marketable securities as follows (in millions):
Gross Gross Net
Realized Realized Realized
Fiscal Year Gains Losses Gains
2005 $198 $(31) $167
2004 105 (17) 88
2003 82 (13) 69
The following table shows the gross unrealized losses and fair values
of the Company’s investments in individual securities that have been
in a continuous unrealized loss position deemed to be temporary for
less than 12 months and for more than 12 months, aggregated by
investment category, at September 25, 2005 (in millions):
Less than More than
12 months 12 months
Fair Unrealized Fair Unrealized
Value Losses Value Losses
U.S. Treasury securities $ — $ — $ 64 $(1)
Government-sponsored
enterprise securities 159 (1) — —
Corporate bonds
and notes 821 (6) 182 (3)
Mortgage-and asset-
backed securities 304 (2) 90 (1)
Non-investment grade
debt securities 337 (12) 17 (1)
Equity securities 384 (29) — —
$2,005 $(50) $353 $(6)
Investment Grade Debt Securities
The Company’s investments in investment grade debt securities
consist primarily of investments in certifi cates of deposit, U.S.
Treasury securities, government-sponsored enterprise securities,
foreign government bonds, mortgage- and asset-backed securities
and corporate bonds and notes. The unrealized losses on the
Company’s investments in investment grade debt securities were
caused by interest rate increases. Due to the fact that the decline
in market value is attributable to changes in interest rates and not
credit quality, and because the severity and duration of the unreal-
ized losses were not signifi cant, the Company considered these
unrealized losses to be temporary at September 25, 2005.
Non-Investment Grade Debt Securities
The Company’s investments in non-investment grade debt securities
consist primarily of investments in corporate bonds. The unrealized
losses on the Company’s investment in non-investment grade debt
securities were caused by credit quality and industry or company
specifi c events. Because the severity and duration of the unrealized
losses were not signifi cant, the Company considered these unreal-
ized losses to be temporary at September 25, 2005.
Marketable Equity Securities
The Company’s investments in marketable equity securities consist
primarily of investments in common stock of large companies and
equity mutual funds. The unrealized losses on the Company’s invest-
ment in marketable equity securities were caused by overall equity
market volatility and industry specifi c events. The duration and
severity of the unrealized losses in relation to the carrying amounts
of the individual investments were consistent with typical equity
market volatility. Current market forecasts support a recovery of
fair value up to (or beyond) the cost of the investment within a rea-
sonable period of time. Accordingly, the Company considered these
unrealized losses to be temporary at September 25, 2005.
NOTE 3. COMPOSITION OF CERTAIN FINANCIAL
STATEMENT CAPTIONS
Accounts Receivable
Sept. 25, Sept. 26,
(in millions) 2005 2004
Trade, net of allowance for doubtful
accounts of $2 and $5, respectively $506 $529
Long-term contracts 26 14
Other 12 38
$544 $581
Inventories
Sept. 25, Sept. 26,
(in millions) 2005 2004
Raw materials $ 23 $ 20
Work-in-process 6 3
Finished goods 148 131
$177 $154