Composition of Certain Financial Statement Items |
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| Composition of Certain Financial Statement Items | Composition of Certain Financial Statement Items
Revenues. We disaggregate our revenues by segment (Note 6), by products and services (as presented on our condensed consolidated statement of operations), and for our QCT (Qualcomm CDMA Technologies) segment, by revenue stream, which is based on the industry and application in which our products are sold (as presented below). In certain cases, the determination of QCT revenues by industry and application requires the use of certain assumptions. Substantially all of QCT’s revenues consist of equipment revenues that are recognized at a point in time, and substantially all of QTL’s (Qualcomm Technology Licensing) revenues represent licensing revenues that are recognized over time and are principally from royalties generated through our licensees’ sales of mobile handsets.
QCT revenue streams were as follows (in millions):
(1) Includes revenues from products sold for use in mobile handsets.
(2) Includes revenues from products sold for use in automobiles, including connectivity, digital cockpit and advanced driver assistance systems (ADAS) and automated driving (AD).
(3) Primarily includes products sold for use in the following industries and applications: consumer (including computing, voice and music and extended reality (XR)), edge networking (including mobile broadband and wireless access points) and industrial (including handhelds, retail, tracking and logistics and utilities).
Revenues recognized from performance obligations satisfied (or partially satisfied) in previous periods generally include certain QCT sales-based royalty revenues related to system software, certain amounts related to QCT customer incentives and QTL royalty revenues recognized related to devices sold in prior periods (including adjustments to prior period royalty estimates, which includes the impact of the reporting by our licensees of actual royalties due) and were as follows (in millions):
Unearned revenues (which are considered contract liabilities) consist primarily of certain customer contracts for which QCT received fees upfront and QTL license fees for intellectual property with continuing performance obligations. In the three months ended December 24, 2023 and December 25, 2022, we recognized revenues of $181 million and $173 million, respectively, that were recorded as unearned revenues at September 24, 2023 and September 25, 2022, respectively.
Remaining performance obligations, which are primarily included in unearned revenues (as presented on our condensed consolidated balance sheet), represent the aggregate amount of the transaction price of certain customer contracts yet to be recognized as revenues as of the end of the reporting period and exclude revenues related to (a) contracts that have an original expected duration of one year or less and (b) sales-based royalties (i.e., future royalty revenues) pursuant to our license agreements.
Concentrations. A significant portion of our revenues are concentrated with a small number of customers/licensees of our QCT and QTL segments. The comparability of customer/licensee concentrations for the interim periods presented are impacted by the timing of customer/licensee device launches and/or innovation cycles and other seasonal trends, among other fluctuations in demand. Revenues from each customer/licensee that were 10% or greater of total revenues were as follows:
Other Income, Costs and Expenses. Other income and expenses in the first quarter of fiscal 2024 and 2023 included certain restructuring amounts (primarily related to accrued severance costs) from cost reduction actions initiated in fiscal 2023.
Discontinued Operations. For the periods presented, Veoneer’s Restraint Control Systems (RCS) business assets and liabilities are reflected as held for sale on our condensed consolidated balance sheets, and the results of operations and cash flows of Veoneer’s Non-Arriver businesses (primarily consisting of the Active Safety and RCS businesses) are presented as discontinued operations on a one quarter reporting lag (through the date of disposition by SSW Partners). Cash flows from investing and financing activities from discontinued operations reported for the periods presented were not material.
On June 1, 2023, SSW Partners completed the sale of the Active Safety business to Magna International Inc. for net cash proceeds of $1.5 billion. In December 2023, SSW Partners entered into a definitive agreement to sell the RCS business. We expect that SSW Partners will complete the sale of the RCS business within early calendar 2024, subject to certain required regulatory approvals and other closing conditions being met.
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