Qualcomm QCOM -0.17%responded on Monday to pressure from activist investor Jana Partners to break up the giant chip maker. Jana’s statements were reported earlier by the Wall Street Journal.

Jana, which holds $11 billion in assets under management and owns a $2 billion stake in Qualcomm, issued a letter pushing the semiconductor legend to consider separating its chip manufacturing unit from its chip design business, which owns valuable patents that account for most of the company’s profit.

Qualcomm’s response emphasized the company’s past and continuing strengths and contributions to the tech economy. It also expressed the company’s commitment to returning shareholder value and an open-minded attitude toward investor input.

The response is reproduced below in full (excluding boilerplate):

Qualcomm welcomes input from our stockholders, including JANA Partners, and weare firmly committed to maintaining an active dialogue with all stockholders and to acting in their best interests.

Our opportunities remain strong. Our innovations have made smartphones the most pervasive technology of our time. They come to market through our inclusive licensing program and our cutting-edge chipsets and continue to play an integral role in the expansion of the mobile industry. We are now bringing the benefits of mobile technologies to new areas such as automotive, healthcare, networking, smart homes, smart cities, and wearables among others.

Our business continues to generate strong operating cash flows, and we are committed to the ongoing return of capital to stockholders while retaining the financial flexibility to execute on our business plans. We recently significantly increased our stock repurchase authorization to $15 billion, one of the largest capital return programs in the sector. We plan to repurchase $10 billion of common stock within one year in addition to our current capital return commitments. Since inception, we have exceeded our minimum capital return target of 75% of free cash flow.

Our Board of Directors and management periodically review our corporate structure. Prior reviews have concluded that the synergies provided by our business model create more value for stockholders than could be created through alternative corporate structures. We will continue to evaluate opportunities to enhance stockholder value and are committed to pursuing the right course of action for all of our stockholders.

By: DocMemory
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