In July 2020, we entered into a settlement agreement, as well as a new long-term, global patent license agreement with Huawei, including a cross license granting back rights to certain of Huawei’s patents, covering sales beginning January 1, 2020. While we continue to assess the accounting impacts of the agreements, our financial guidance for the fourth quarter of fiscal 2020 includes the following:

• Estimated QTL revenues for royalties due on sales made by Huawei in the September 2020 quarter.

• Estimated revenues of approximately $1.8 billion related to amounts due from Huawei under the settlement agreement (which are incremental to amounts previously paid under two interim agreements) and estimated amounts due for the March 2020 and June 2020 quarters under the new global patent license agreement. This amount will be excluded from our Non-GAAP results.

Our guidance for the fourth quarter of fiscal 2020 includes an impact of greater than ($0.25) to EPS attributable to a planning assumption of an approximate 15% year-over-year reduction in handset shipments due to COVID-19, including a partial impact from the delay of a global 5G flagship phone launch