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Broadcom Beats Q1 Earnings Estimates, Outlook on Q2 Optimistic (BRCM)

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Shares of Broadcom Corporation (NASDAQ: BRCM) rallied 5.80% in extended trading hours on Tuesday after the semiconductor company handed better-than-expected fiscal first quarter results, thanks to rapidly expanding smartphone market.

The Company’s net income more than doubled in the recently concluded quarter as top line was driven by solid demand for connectivity chips and wireless baseband.

Broadcom, which supplies chips to smartphone makers such as Apple Inc. (NASDAQ: AAPL) and Samsung Electronics, has benefitted immensely due to proliferation of smartphone usage.  Analysts were little skeptic due to slowdown in demand for iPhones and iPads in the recent past though.

However, Broadcom’s diverse customer base helped in driving the growth. Lately the Company is also trying to gain traction in network processors market.

Addressing analysts in earnings call, Broadcom Corp’s Chief Executive Scott McGregor said, “Looking forward, we see broad-based sequential growth driven by our industry-leading portfolio of wired and wireless communications platform.”

For the fiscal second quarter, the Company expects revenue of approximately $2.1 billion which is higher than analysts’ consensus forecast of $2.05 billion, according to a data compiled by Thomson Reuters.

For the fiscal first quarter, the Irvine CA based Company reported a profit of $191 million or 33 cents a share compared to a profit of $88 million or 15 cents a share, in the year-earlier quarter. Stripping out onetime items, non-GAAP or adjusted earnings came at 65 cents a share while analysts’ consensus forecast was for 56 cents a share.

Revenue during the quarter soared 9.7% to $2 billion. Earlier in January, the Company provided a revenue guidance of about $1.9 billion.

Gross margin increased to 49.4% from 48.1%, in the year-earlier quarter.

 

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edliston
Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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