July 25, 2011 / 8:25 PM / 7 years ago

UPDATE 3-Broadcom results beat Street, stock leaps

* Q2 revenue in line with Street

* Forecasts Q3 revenue between $1.9 bln and $2 bln

* EPS beats estimates

* Stock jumps after hours (Rewrites first paragraph, adds quote, details)

By Noel Randewich

SAN FRANCISCO, July 25 (Reuters) - Wireless chipmaker Broadcom BRCM.O gave a rosier-than-expected outlook for its revenues, dispelling worries about a tepid economy and high inventories and giving a hefty boost to its shares.

Supply chain hiccups caused by Japan’s earthquake last March are largely over and Broadcom expects to expand its home, wireless and infrastructure businesses during the current quarter, executives said.

“We are seeing increasing attach rates for our wireless connectivity devices in phones, tablets and a number of connected home and consumer electronic products,” Chief Executive Officer Scott McGregor told analysts on a conference call.

Weakness at Nokia NOK1V.HE and growing competition from Qualcomm (QCOM.O) in Wi-Fi chips had been a concern for some analysts.

A dreary economy has also weakened sentiment for chipmakers recently, with Silicon Laboratories’ (SLAB.O) shares slumping 13 percent on Monday after its earnings report fell short of expectations.

Texas Instruments TXN.N, warning of economic uncertainties, forecast only modest sequential growth in the current quarter. [nN1E76O15C]

    “It’s very much a relief,” said Williams Financial Group analyst Cody Acree. “Broadcom’s obviously not giving us any indication they’re seeing a slowdown. They’re in so many markets if there was an issue, they’d probably be in the middle of it.”

    Broadcom, which makes Bluetooth and other wireless chips for phones, tablets, modems and game consoles, forecast third-quarter revenue between $1.9 billion and $2 billion. Analysts had expected $1.930 billion, according to Thomson Reuters I/B/E/S.

    Broadcom said its second-quarter revenue was $1.8 billion, up 12 percent, in line with the $1.805 billion expected on average by analysts.

    Earnings were $175 million, or 31 cents per share, compared with $278 million, or 52 cents per share, in the same quarter the year before.

    Non-GAAP EPS for the quarter was 72 cents, higher than the 63 cents expected by analysts.

    Shares of Broadcom were up 8.13 percent at $37.75 in extended trade after closing down 1.58 percent. (Reporting by Noel Randewich, editing by Bernard Orr and Gunna Dickson) (Additional reporting by Sinead Carew in New York)

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