Qualcomm 2004 Annual Report Download - page 73

facility matures. Inquam is currently working with the bank and other potential lenders to secure long-term “take out” financing to repay the
existing loan on the maturity date. It is possible that the Company and the Other Investor may provide additional guarantees in connection with
such take out financing.
During the first quarter of fiscal 2005, the Company and the Other Investor committed to fund an additional $2 million each. While the Company
has no other obligations to provide funding to Inquam, the Company continues to have active discussions with Inquam and the Other Investor
concerning the necessary funding for all or a part of Inquam’s business plan, potential restructuring and investment by other parties. While the
Company may provide some additional funding and/or credit support in furtherance of Inquam’s business plan, the amount and form of such
support is unknown, and none will be provided without commensurate support or consideration being provided by the Other Investor.
Inquam’s summarized financial information, derived from its unaudited financial statements, is as follows (in millions):
September 30,
2004 2003
Balance sheet:
Current assets $ 40 $ 45
Noncurrent assets 152 173
Total assets $192 $218
Current liabilities $123 $ 98
Noncurrent liabilities 132 47
Total liabilities $255 $145
Years Ended September 30,
2004 2003 2002
Income statement:
Net revenues $ 88 $ 50 $ 18
Gross profit (loss) 35 (2) (9)
Net loss $(136) $(205) $(104)
Other
Other strategic equity investments as of September 30, 2004 and 2003 totaled $123 million and $87 million, respectively, including $50 million
and $33 million, respectively,accounted for using the cost method. Differences between the carrying amounts of certain other strategic equity
method investments and the Company’s underlying equity in the net assets of those investees, consisting of acquisition related goodwill and
intangible assets accounted for in accordance with FAS 142, were not significant at September 30, 2004 and 2003. At September 30, 2004,
effective ownership interests in these investees ranged from less than 1% to 50%.
Summarized financial information regarding the Company’s principal equity method investments, excluding Inquam, derived from their unaudited
financial statements, follows. These investments are primarily noncontrolling interests in early stage companies and venture funds. Information
is presented in the aggregate, and net loss is generally presented from the acquisition date (in millions):
September 30,
2004 2003
Current assets $100 $ 82
Noncurrent assets 236 41
Total assets $336 $123
Current liabilities $21 $—
Noncurrent liabilities 86 1
Total liabilities $107 $ 1
Years Ended September 30,
2004 2003 2002
Income statement:
Net revenues $5$—$—
Gross loss (16) — —
Net loss $(38) $(41) $(64)
Funding commitments related to these investments total $19 million at September 30, 2004, which the Company expects to fund through fiscal
2009. Such commitments are subject to the investees meeting certain conditions; actual equity funding may be in lesser amounts. An investee’s
failure to successfully develop and provide competitive products and services due to lack of financing, market demand or an unfavorable economic
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