(RTTNews) - Amended: corrects to replace "Q2" with "Q3" in the headline

Thursday, Chip maker Broadcom Corp. (BRCM: News ) reported a sharp decline in third quarter profit, on increased expenses and a drop in revenue hurt by weak performance from all its segments. Earnings for the quarter fell short of analysts' estimate, while revenues came in ahead of consensus. Broadcom shares dropped more than 9% following the news in after hours trading.

The Irvine, California-based company reported net income for the third quarter of $84.6 million or $0.16 per share, compared to $164.9 million or $0.31 per share in the year-ago quarter.

On average, twenty four analysts polled by Thomson Reuters expected the company to earn $0.33 per share for the quarter. Analysts estimates typically exclude special items.

Net revenues for the quarter decreased 3.4% to $1.25 billion from $1.30 billion in the prior-year quarter. Revenues, nevertheless, came in ahead of twenty eight Street analysts' consensus of $1.16 billion for the third quarter.

Segment wise, product revenue for the quarter dropped to $1.19 million from $1.25 billion in the third quarter of 2008. Licensing revenue grew to $59.45 million from $44.39 million in the year-earlier quarter.

In the immediately preceding second quarter, Broadcom reported a sharp decline in its profit of $13.40 million or $0.03 per share, as revenue dropped 13.4% to $966.32 million.
Among the others in the industry, Texas Instruments Inc. (TXN) said that its third quarter profit dropped 4% to $538 million or $0.42 per share. Earnings were hurt mainly by lower revenue, essentially the Wireless segment. Revenues for the quarter declined 15% to $2.88 billion.

Another peer, Qualcomm Inc. (QCOM) is scheduled to report its third quarter financial results on November 1. The Street currently expect Qualcomm to report earnings of $0.52 per share on revenues of $2.72 billion for its third quarter.

For the quarter under review, total gross margin of Broadcom was 50.9%, compared to 52.3% in the corresponding quarter last year.

Total operating cost and expenses was $1.17 billion, compared to $1.14 million in the year-earlier quarter. Income from operations was $88.63 million, compared to $157.36 million in the same quarter last year.

Research and development expenses was $391.17 million, compared to $379.23 million in the prior-year quarter. Selling, general and administrative expenses was $142.48 million, compared to $141.94 million in the year-earlier quarter.

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