By Noel Randewich
SAN FRANCISCO Jan 30 Broadcom on
Thursday posted fourth-quarter revenue and profits that were
down from a year earlier, but the results slightly exceeded
expectations of Wall Street analysts concerned about tepid
The chipmaker reported fourth-quarter revenue of $2.06
billion, down 0.8 percent from the year-ago period. It said
revenue in the first quarter would be between $1.9 billion and
While Broadcom's connectivity chips are widely used in
high-end smartphones like Apple's iPhone, they are included less
often in low-end handsets favored by many consumers in emerging
markets, where growth in smarpthones has shifted.
Concerns about slowing smartphone sales grew on Monday when
Apple gave a weak revenue forecast and reported
lower-than-expected holiday iPhone sales.
"Despite Apple disappointing on some of their numbers, the
supply chain seems to be exceeding expectations," RBC analyst
Doug Freedman said of Broadcom's quarterly results.
To make up for the smartphone shift to emerging markets,
Broadcom is launching advanced LTE baseband chips to compete
with dominant player Qualcomm and is also stepping up
its focus on networking in data centers.
Broadcom gets around half of its revenues from mobile, with
the rest coming from network infrastructure and home products
like modems and set-top boxes. Broadcom said that in the
December quarter it sold more networking chips than it expected.
Chief Financial Officer Eric Brandt told analysts on a
conference call that for the March quarter, he expects revenue
from Broadcom's broadband and infrastructure segments to be
"down slightly," and from its mobile and wireless business to be
Broadcom said that in the December quarter, revenue from its
mobile and wireless segment decreased 7 percent sequentially, in
line with its previous expectations. Customers reducing
inventories of mobile chips in the December quarter will do the
same in the March quarter, the company said.
Broadcom also said it was increasing its quarterly dividend
by 9 percent.
Fourth-quarter net profit for Broadcom fell to $168 million,
or 29 cents a share, versus $251 million, or 43 cents last year.
Non-GAAP earnings per share were 60 cents, better than the
57 cents expected by analysts.
Analysts on average had expected fourth-quarter revenue of
$2.020 billion and first-quarter revenue of $1.967 billion,
according to Thomson Reuters I/B/E/S.
Following delays with technology development last year,
Broadcom expects to start receiving revenue from its first LTE
baseband chips in the first quarter, with Samsung Electronics
as its first significant customer.
Like larger Intel, Broadcom has been slow to launch
chips featuring multimode, carrier-validated LTE, or Long Term
Evolution, a technology allowing fast data transfer rates in
smartphones that has become widely adopted in the United States.
Adding to worries about smartphone demand, Samsung last week
posted an 18 percent drop in fourth-quarter mobile profits,
including weaker-than-expected sales of its Galaxy S4 high-end
Broadcom shares were up 0.48 percent in extended trading
after closing up 1.81 percent at $29.21 in regular Nasdaq trade.