Leading semiconductor manufacturer
) reported a GAAP net income of $191 million or 33 cents per
share in first quarter 2013 versus $88 million or 15 cents in the
year-ago quarter. The year-over-year increase in earnings was
primarily driven by a better-than-expected performance by
wireless baseband and connectivity chips. Despite more than a
two-fold rise, the reported earnings missed the Zacks Consensus
Estimate by a couple of cents.
Non-GAAP net income stood at $400 million or 65 cents per share
in the reported quarter compared to $387 million or 65 cents in
the year-earlier quarter.
Total revenues for first quarter 2013 were $2.0 billion, up
11.1% year over year and ahead of the Zacks Consensus Estimate of
$1.9 billion. In terms of revenue composition, product revenues
came in at $1.9 billion in the reported quarter, while income
) agreement came in at $43 million and license revenues stood at
BROADCOM CORP-A (BRCM): Free Stock Analysis
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In terms of end markets, Broadband Communications revenues were
$537 million, up 9% year over year, driven by growth in set-top
boxes. Mobile & Wireless segment revenues decreased 2%
sequentially to $996 million. Revenues from Infrastructure &
Networking segment climbed 6% year over year, driven by a growth
in large-scale cloud data center build-outs and optical transport
Non-GAAP product gross margin remained relatively flat at 52.0%
in the reported quarter, while GAAP product margin came in at
49.4%, up from 48.1% in the year-ago quarter.
GAAP research and development and selling, general and
administrative expenses were $794 million in first quarter 2013
compared to $725 million in the prior-year quarter.
Balance Sheet/Cash Flow
Broadcom generated $388 million in cash from operations in first
quarter 2013. The company ended the quarter with cash and cash
equivalents of $1.7 billion, marginally up from $1.6 billion at
year-end 2012. Long-term debt was fairly stable at $1.4 billion.
Concurrent with the earnings release, management provided its
guidance for second quarter 2013. Total revenue is expected to be
around $2.1 billion. Product gross margin on a GAAP basis as well
as on a non-GAAP basis are expected to be down 50 basis points
sequentially in the second quarter of 2013. Research &
development and selling, general, and administrative expenses
(both GAAP and non-GAAP) are expected to be flat to up to $20
Broadcom presently has a Zacks Rank #4 (Sell). Other notable
companies in the sector that are worth mentioning include
Nitto Denko Corporation
), carrying a Zacks Rank #1 (Strong Buy), and
Texas Instruments Inc.
), carrying a Zacks Rank #2 (Buy).