Broadcom Earnings Call Insights: Mobile Guidance and Seasonality for Wireless

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Broadcom Corporation (NASDAQ:BRCM) recently reported its fourth quarter earnings and discussed the following topics in its earnings conference call.

Mobile Guidance

James Schneider – Goldman Sachs: I was wondering in terms of the Mobile & Wireless guidance, how should we think about your guidance for that segment relative to what you expect the overall market to do. In other words, do you think you’re doing better or worse than the market in terms of gain you are losing share in Q1?

Scott A. McGregor – President and CEO: Jim, I would say in the connectivity space there is – it’s a soft quarter from a seasonality point of view. So, that amounts to most of the decline. In 3G basebands, we actually expect to grow though. So, I expect we are taking share in basebands and probably holding share in connectivity or maybe gaining a little bit.

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James Schneider – Goldman Sachs: Then as a follow-up. Eric, maybe if you look at mix effect on gross margin as we head through the year, what do you expect the 40-nanometer mix to do in terms of improving gross margin is that going to be a tailwind to margins and what do you expect that 40-nanometer mix to be by the end of this year?

Eric K. Brandt – EVP and CFO: We ended Q4 at just over 20%, 40-nanometer we benefited from that. I think 40-nanometer will benefit us over the course of the year. I think the real challenge will be, what is the strength of the Infrastructure business, which obviously gives us a fairly rich mix, so I think the 40-nanometer is a positive, and assuming the infrastructure market rebounds in the middle and back half of the year that will be a positive as well. To the extent that it doesn’t and we continue to grow on the Mobile & Wireless space we could have a little bit of headwind offsetting that 40-nanometer tailwind.

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