Broadcom to 'right-size' digital TV organisation

Thursday, October 22nd, 2009
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IRVINE, Calif. — Broadcom Corporation (Nasdaq: BRCM) today reported unaudited financial results for its third quarter ended September 30, 2009.

Net revenue for the third quarter of 2009 was $1.254 billion. This represents an increase in net revenue of 20.6% compared with the $1.040 billion reported for the second quarter of 2009 and a decrease of 3.4% compared with the $1.298 billion reported for the third quarter of 2008. Net income computed in accordance with U.S. generally accepted accounting principles (GAAP) for the third quarter of 2009 was $84.6 million, or $.16 per share (diluted), compared with GAAP net income of $13.4 million, or $.03 per share (diluted), for the second quarter of 2009, and GAAP net income of $164.9 million, or $.31 per share (diluted), for the third quarter of 2008.

Net revenue for the nine months ended September 30, 2009 was $3.148 billion. This represents a decrease in net revenue of 10.9% from the $3.532 billion reported for the nine months ended September 30, 2008. Net income computed in accordance with GAAP for the nine months ended September 30, 2009 was $6.1 million, or $.01 per share (diluted), compared with GAAP net income of $374.0 million, or $.70 per share (diluted), for the nine months ended September 30, 2008.

On the earnings conference call, Scott McGregor, Broadcom CEO said:

“The one head wind we faced in the quarter was in the digital TV market, where our results were negatively impacted by one large customer losing share in North America, and some share loss with other customers.

In light of these Broadcom-specific issues and the impact of the economic downturn on the digital TV market as a whole, we’re taking actions to appropriately size this business. We remain committed to the DTV market. We will continue to invest, and we still see DTV as a significant revenue growth driver for the company in 2010. We are right-sizing our digital TV organization as part of our ongoing portfolio management, consistent with our revenue forecast and as a final step in the integration of the AMD DTV business into Broadcom.”

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