Broadcom on a roll
Chip-set manufacturer Broadcom has just released a spectacular set of half-year numbers, helped in part by the recent settlement of its long-running dispute with Qualcomm.
Net revenue for the second quarter of 2009 was $1.040 bn. This represents an increase in net revenue of 21.9% compared with the $853.4m reported for the first quarter of 2009 and a decrease of 13.4% compared with the $1.201bn reported for the second quarter of 2008. Net income for the second quarter of 2009 was $13.4m compared with GAAP net loss of $91.9m for the first quarter of 2009.
Readers might remember that on April 26, 2009, Broadcom and Qualcomm announced that they had entered into a settlement and multi-year patent agreement. Under the agreement, Qualcomm will pay Broadcom $891.2m over a four-year period. In connection with this agreement, Broadcom recorded a $65.3m gain on settlement and $67.3m of licensing revenue in the three months ended June 30, 2009.
"Despite the continued global economic uncertainty, Broadcom's results for the second quarter reflected a return to a more stable ordering pattern and the ramp of new products from our end customers," said Scott McGregor, Broadcom's President/CEO. "In the second quarter, Broadcom generated strong sequential revenue growth, with product revenue near the top end of the range provided in April. We are pleased that research and development and selling, general and administrative expenses once again increased less than anticipated from the first quarter of 2009, reflecting our continued focus on maintaining solid financial discipline. In addition, we generated strong cash flow in excess of $325m from operations."
"Our operating strategy for 2009 remains focused on managing our business to gain share and generate positive quarterly cash flow from operations. Based upon the customer activity we have experienced to date we anticipate that future revenue growth will be broad based with slightly stronger growth within our mobile and wireless targeted end market, driven by new product ramps and the upcoming holiday season."