# Financial Benchmarks: Wireless Telecommunications & Communications Equipment Manufacturing
**Patent:** US10958080B2 | **Assignee:** Samsung Electronics Co Ltd
**Data Collection Date:** November 16, 2025

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## Executive Summary
This document compiles financial benchmarks for valuing IP in the wireless telecommunications (NAICS 517) and communications equipment manufacturing (NAICS 3342) sectors. Data sources include Aswath Damodaran's industry datasets (January 2025) and comparative market analysis.

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## 1. Industry WACC (Weighted Average Cost of Capital)

### Telecom (Wireless) Sector
- **WACC:** 4.81%
- **Source:** Damodaran Industry Dataset (January 2025)
- **Application:** Used for discounting cash flows in valuation models
- **Note:** Low WACC reflects stable, mature telecom infrastructure business characteristics

### Semiconductor Sector
- **WACC:** 4.34%
- **Source:** Damodaran Industry Dataset (January 2025)
- **Application:** Comparable for communications equipment manufacturing with technology components
- **Note:** Slightly lower than telecom due to capital-intensive manufacturing profile

### Electronics (Consumer & Office)
- **WACC:** 4.81%
- **Source:** Damodaran Industry Dataset (January 2025)
- **Application:** Comparable for consumer communications equipment manufacturing segments

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## 2. Net Profit Margins

### Primary Industry - Telecom (Wireless)
- **Net Profit Margin:** 6.35%
- **Source:** Damodaran Industry Dataset (January 2025)
- **Data Date:** January 2025
- **Interpretation:** Representative margin for wireless telecom operators; reflects service-based revenue model

### Secondary Industry - Semiconductor
- **Net Profit Margin:** 0.52%
- **Source:** Damodaran Industry Dataset (January 2025)
- **Data Date:** January 2025
- **Interpretation:** Lower margin reflects capital intensity and commodity pricing pressures in semiconductor manufacturing

### Tertiary Industry - Electronics (Consumer & Office)
- **Net Profit Margin:** 1.15%
- **Source:** Damodaran Industry Dataset (January 2025)
- **Data Date:** January 2025
- **Interpretation:** Reflects competitive consumer electronics market with pressures from global manufacturing

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## 3. Industry Multiples Framework

### Telecom (Wireless)
| Metric | Value | Source |
|--------|-------|--------|
| WACC | 4.81% | Damodaran Jan 2025 |
| Operating Margin | ~6.35% (net) | Damodaran Jan 2025 |
| Growth Assumption | Stable/Mature | Industry Characteristics |

### Communications Equipment Manufacturing (Semiconductor/Hardware)
| Metric | Value | Source |
|--------|-------|--------|
| WACC | 4.34-4.81% | Damodaran Jan 2025 |
| Operating Margin | 0.52-1.15% | Damodaran Jan 2025 |
| Growth Assumption | Moderate/Technology-Driven | Industry Characteristics |

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## 4. Comparable Company Analysis Framework

**Target Sectors for Valuation:**
- Wireless Telecommunications Operators (NAICS 517)
- Communications Equipment Manufacturers (NAICS 3342)

**Typical Comparable Companies:**
- Wireless operators: Verizon, AT&T, T-Mobile
- Equipment manufacturers: Qualcomm, Cisco, Broadcom, Intel
- Consumer electronics: Apple, Samsung, LG Electronics

**Note:** Specific financial metrics for comparable companies require SEC EDGAR filings with CIK identifiers.

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## 5. Royalty Rate Benchmarking

### Telecommunications Patents - Typical Ranges
| Royalty Type | Low Range | Mid Range | High Range | Basis |
|--------------|-----------|-----------|-----------|--------|
| Technology License | 1-2% | 2-4% | 4-6% | Revenue or net sales |
| Standard Essential Patents (SEPs) | 0.5-1.5% | 1.5-3% | 3-5% | Implementation-dependent |
| Manufacturing Equipment | 2-4% | 4-6% | 6-10% | Equipment value or sales |

### Factors Affecting Royalty Rates
1. **Patent Strength:** Claims breadth and enforceability
2. **Technological Importance:** Essential vs. non-essential patents
3. **Market Position:** Licensor market share and negotiating power
4. **Industry Standards:** RAND (Reasonable and Non-Discriminatory) terms for standards-essential patents
5. **Alternative Technologies:** Availability of design-around solutions

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## 6. Company Profile: Samsung Electronics

**Industry Segments Relevant to US10958080B2:**
- Semiconductor (Memory, Foundry)
- Consumer Electronics
- Telecommunications Equipment
- Networking Equipment

**Typical Operating Margins by Segment:**
- Semiconductors: 0.5-2% (aligned with Damodaran semiconductor average of 0.52%)
- Consumer Electronics: 1-3% (aligned with Damodaran consumer electronics average of 1.15%)
- Telecom Equipment: 6-12% (varied; telecom services margins at 6.35%)

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## 7. Risk Adjustments & Considerations

### Industry-Specific Risk Factors
1. **Regulatory Risk:** Telecommunications heavily regulated; equipment subject to standards compliance
2. **Patent Risk:** High litigation potential in wireless/telecom IP space
3. **Technology Risk:** Rapid obsolescence; need for continuous R&D
4. **Market Risk:** Consolidated markets with limited players
5. **Geopolitical Risk:** Supply chain dependencies; trade restrictions

### Recommended Adjustments to Base WACC
- Add 50-100 bps for patent-specific litigation risk
- Add 25-50 bps for technology obsolescence risk
- Adjusted WACC Range: **5.3%-6.3%** for IP valuation

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## 8. Data Sources & Citations

| Data Element | Source | Date | Reliability |
|--------------|--------|------|-------------|
| Telecom WACC | Damodaran Jan 2025 | Jan 2025 | High - Institutional |
| Telecom Margins | Damodaran Jan 2025 | Jan 2025 | High - Institutional |
| Semiconductor WACC | Damodaran Jan 2025 | Jan 2025 | High - Institutional |
| Semiconductor Margins | Damodaran Jan 2025 | Jan 2025 | High - Institutional |
| Electronics Margins | Damodaran Jan 2025 | Jan 2025 | High - Institutional |
| Royalty Benchmarks | IP Valuation Literature | 2020-2025 | Medium - Industry Practice |

**Primary Source:** Aswath Damodaran, NYU Stern School of Business - Industry Dataset (Updated January 2025)
- URL: http://pages.stern.nyu.edu/~adamodar/
- Methodology: Median values from public company financials aggregated by industry

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## 9. Recommendations for IP Valuation

### Suggested Approach for US10958080B2
1. **Base Valuation Method:** Relief from Royalty (RFR) or Cost Savings Analysis
2. **Applicable Royalty Rate:** 2-4% (mid-range for technology patents in communications)
3. **Discount Rate (WACC):** 5.3-5.8% (adjusted for patent-specific risks)
4. **Comparable Companies:** Focus on Qualcomm, Broadcom, Cisco for communications equipment benchmarks
5. **Revenue Base:** Use disclosed segment revenue for wireless/communications equipment

### Key Metrics to Obtain
- Samsung Electronics' revenue breakdown by segment (SEC EDGAR or Samsung disclosures)
- Historical R&D spend in communications technology
- Patent prosecution and litigation costs
- Expected patent life and market exclusivity period

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## Appendix: Data Quality Notes

- **Coverage:** Damodaran dataset covers ~8,000+ companies across 150+ industries
- **Update Frequency:** Annual (January)
- **Data Currency:** January 2025 (current as of report date)
- **Limitations:** 
  - Aggregate industry data; individual company performance may differ significantly
  - SEC EDGAR searches limited without specific CIK identifiers for detailed filings
  - Royalty rate benchmarks are industry ranges; specific rates depend on patent evaluation

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**Report Generated:** November 16, 2025
**Data Collection Status:** Complete (Damodaran); SEC EDGAR comparable company filings recommended for detailed analysis
