The initial phase of the self examination took what might be considered the ‘usual route’. The company said in July 2015 that it was ‘rightsizing’ the cost structure by eliminating approximately $1.4billion in spending, which also meant 4500 potential job losses. But part of the announcement was a review of ‘alternatives’ to the corporate and financial structure.
One of the issues which Jana was keen to pursue was splitting the company into two: one entity to handle microelectronics; another to license Qualcomm’s IP portfolio. In one scenario, the microelectronics business would have ended up ‘on the block’, with the apparently lucrative IP business retained.
Now the results of the review have been received by Qualcomm’s board, which has concluded that business should continue as usual. The official line is that its current corporate and financial structure best positions the company to maintain its technology leadership and product strength.
The question now is whether this review will satisfy Qualcomm’s investors and Jana in particular. While Qualcomm might have fended off the challenge for the moment, it will be under particular scrutiny from its investors to deliver in the future.
