Tags: Broadcom | Earnings | Apple | Demand

Broadcom Earnings Beat Predictions on Apple Demand

Tuesday, 21 Oct 2014 08:54 PM

Shares of Broadcom Corp. rose in extended trading Tuesday after the maker of communications chips reported third-quarter earnings that beat analysts’ estimates and gave a forecast that eased concern orders might be drying up.

The stock climbed as much as 7.2 percent in late trading. In its earnings announcement, Broadcom also said revenue in the current period will be $2 billion to $2.15 billion, compared with an average estimate of $2.11 billion, according to data compiled by Bloomberg.

Orders for chips that connect devices — such as Apple Inc.’s iPhone and iPad — to Bluetooth and Wi-Fi networks helped boost revenue in the third quarter, the Irvine, California-based company said. Demand for set-top box components helped the company defy projections that Broadcom would be hurt by falling demand from Samsung Electronics Co. and customers in China, said Doug Freedman, an analyst at RBC Capital Markets.

“People were really afraid of a miss,” said Freedman, who has the equivalent of a buy rating on the stock. “Their beat in the quarter was impressive. There was no sign of anything going any worse than expected.”

Broadcom’s orders from Apple for the latest version of its iPhone helped make up for weaker demand from Samsung, which has lost market share, Freedman said.

Broadcom shares traded as high as $40 in extended trading after earlier rising 2.8 percent to $37.33 at the close in New York. The stock has jumped 26 percent this year.

Third-quarter net income was $98 million, or 16 cents a share, compared with $316 million, or 55 cents, in the same period a year earlier. Excluding certain charges, profit was 91 cents, topping an average analyst estimate of 84 cents.

Revenue rose to $2.26 billion, Broadcom said, compared with an average analyst prediction of $2.18 billion.

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Shares of Broadcom Corp. rose in extended trading Tuesday after the maker of communications chips reported third-quarter earnings that beat analysts' estimates and gave a forecast that eased concern orders might be drying up.
Broadcom, Earnings, Apple, Demand
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2014-54-21
Tuesday, 21 Oct 2014 08:54 PM
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