Broadcom Corp. (BRCM) said Tuesday its profit for the fourth quarter slid from last year as lower demand for its chips in smartphones and other devices led to a 6.4 percent drop in revenues. Nonetheless, revenues for the quarter came in ahead of Street estimates. Broadcom benefited from lower one-time expenses, offset by a higher income tax provision.
The company has forecast first quarter 2012 revenue, the midpoint of which is expected to top Street estimates.
Net income for the fourth quarter declined to $254 million or $0.45 per share from $266 million or $0.47 per share last year.
Results for the quarter include stock-based expense of $115 million, amortization charges of $24 million, among others.
The prior year included stock-based expense of $133 million, amortization charges of $26 million, impairments of $17 million, settlement costs of $49 million, among others.
Excluding items, adjusted earnings for the quarter were $395 million or $0.68 per share, compared to $488 million or $0.83 per share a year ago.
On average, 33 analysts polled by Thomson Reuters expected earnings of $0.65 per share for the quarter. Analysts' estimates typically exclude special items.
Irvine, California-based Broadcom reported revenues of $1.82 billion, down from $1.95 billion last year. Thirty-five analysts expected $1.80 billion.
Product revenues dropped to $1.764 billion from $1.89 billion last year, while income from a Qualcomm agreement was unchanged at $52 million.
Provision for income taxes for the quarter was higher at $22 million, compared to $6 million in the prior year.
Broadcom also declared an 11 percent increase in the quarterly cash dividend to $.10 per share, payable to holders of its Class A and Class B common stock. The dividend will be paid on March 5 to concerned shareholders of record on February 17. Looking ahead, Broadcom expects first-quarter 2012 revenues in the range of $1.7 billion to $1.8 billion. Analysts currently estimate revenues of $1.73 billion.
Broadcom anticipates gross margin for the period to be almost same as in the fourth quarter 2011.
About a week ago, Broadcom's larger rival Texas Instruments Inc. (TXN) reported a 68 percent plunge in fourth-quarter earnings, hurt by weak demand, acquisition costs, and charges related to the planned closures of 2 plants. Texas Instruments has also forecast first-quarter earnings to come in below analysts estimates.
BRCM closed Tuesday on the Nasdaq at $34.35, down $0.10 or 0.29%, on a volume of over 14.6 million shares on the Nasdaq. In after hours, the stock gained $0.65 or 1.89%.
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