Taking Aggressive Actions to Improve Performance - Plan Designed to Right-Size Cost Structure and Increase QCT Margins - Will Examine Financial and Structural Alternatives to Create Stockholder Value and Position the Company for Future Growth - Plan Endorsed by JANA Partners, a Significant Qualcomm Stockholder
Qualcomm Incorporated (NASDAQ: QCOM) today announced it has initiated a Strategic Realignment Plan designed to improve execution, enhance financial performance and drive profitable growth as the Company works to create sustainable long-term value for stockholders. The Company also announced that it has entered into an agreement with JANA Partners pursuant to which Mark McLaughlin and Tony Vinciquerra have been added to the Board of Directors and a third director to be selected by the Company and consented to by JANA will be added promptly.
The core elements of the new plan include:
Aggressively right-sizing the cost structure by eliminating approximately $1.4 billion in spending, including an approximately $300 million reduction in annual share-based compensation grants; Company expects to achieve this run-rate by the end of fiscal year 2016
Reviewing alternatives to the Company’s corporate and financial structure
Reaffirming the Company’s plan to return significant capital to stockholders
Adding new Directors with complementary skills while reducing the average tenure of the Board of Directors
Further aligning executive compensation with performance, including returns on investment
Disciplined investment in areas that further Qualcomm’s leadership positions, build upon the Company’s core technologies and capabilities and offer attractive growth opportunities and returns
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