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Broadcom Net Income Triples on Chip Sales

October 21, 2005|From Reuters

Broadcom Corp. reported a tripling of third-quarter profit Thursday as the company sold more microchips for television set-top boxes and high-speed Internet modems.

The Irvine company also issued a forecast for the fourth quarter, which is typically fueled by holiday sales, that exceeded Wall Street expectations.

Chief Executive Scott McGregor said in a conference call that the demand Broadcom saw in the third quarter would continue into the fourth. He cited the convergence of computing, communications and digital entertainment.

The company said third-quarter net income rose to $132.7 million, or 35 cents a share; that compared with $43.9 million, or 13 cents, a year earlier, when legal costs depressed results. Sales rose 7.5% to $695 million, beating the Wall Street estimate of $665 million.

Shares of Broadcom, which reported after the market close, rose more than 5% to $46.60 after hours. In regular trading the stock rose 72 cents, or 1.7%, to $44.30.

In the conference call, Broadcom Chief Financial Officer William Ruehle said fourth-quarter revenue would rise to $765 million to $775 million, an increase of 10% to 12% from the third quarter.

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