Broadcom Earnings: Beats Street as Revenue Ticks Higher

Rising costs hurt S&P 500 (NYSE:SPY) component Broadcom Corporation (NASDAQ:BRCM) in the second quarter as profit dropped from a year earlier. Broadcom manufactures semiconductors for wired and wireless communications.

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Broadcom Corporation Earnings Cheat Sheet

Results: Net income for the semiconductors-communications fell to $160 million (28 cents per share) vs. $175 million (31 cents per share) a year earlier. This is a decline of 8.6% from the year-earlier quarter.

Revenue: Rose 9.7% to $1.97 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Broadcom Corporation reported adjusted net income of 72 cents per share. By that measure, the company beat the mean estimate of 43 cents per share. Analysts were expecting revenue of $1.95 billion.

Quoting Management: “Broadcom delivered record revenue in Q2 with strength across all three business groups,” said Scott McGregor, Broadcom’s President and Chief Executive Officer. “Broadcom’s technology leadership and commitment to integration is changing the fundamental economics of communications devices across our addressable markets. This is driving share gains and increasing our content per platform, positioning the company to deliver above market growth over the long-term.”

Key Stats:

The company has now beaten analyst estimates for three quarters in a row. It beat the mark by 6 cents in the first quarter and by 5 cents in the fourth quarter of the last fiscal year.

Net income has dropped 25.8% year-over-year on average across the last five quarters. Performance was hurt by a 61.4% decline in the first quarter from the year-earlier quarter.

The company’s revenue has now risen for two quarters in a row. In the first quarter, revenue increased 0.6% to $1.83 billion from the year-earlier quarter.

Looking Forward: Expectations for the company’s next-quarter results are lower than they have been. Over the past sixty days, the average estimate for third quarter has fallen from 55 cents per share to 54 cents. The average estimate for the fiscal year is $1.97 per share, a rise from $1.86 ninety days ago.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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