Wednesday October 18, 4:13 pm Eastern Time
Press Release
Broadcom Reports Record Third Quarter Revenue
and Profit
IRVINE, Calif.--(BUSINESS WIRE)--Oct. 18, 2000--Broadcom Corporation (Nasdaq: BRCM - news) today reported record
revenue and profit for its third fiscal quarter, ended September 30, 2000.
Revenue for the third quarter was a record $319.2 million, an increase of 128.7% over the $139.6 million reported in the third quarter of 1999 and an increase of 30.2% over the $245.2 million reported in the second quarter of 2000. Pro forma net income was a record $78.7 million, or $.30 per share (diluted). This compares with pro forma net income of $28.7 million, or $.12 per share (diluted), for the same quarter in 1999 and with pro forma net income of $61.1 million, or $.24 per share (diluted), in the second quarter of 2000. Diluted earnings per share for the quarter were based on 264.8 million weighted average shares outstanding, compared to 238.3 million weighted average shares outstanding in the third quarter of 1999 and to 253.9 million weighted average shares outstanding in the second quarter of 2000.
Pro forma net income excludes the effects of acquisition-related expenses and payroll taxes on certain stock option exercises. Including these charges, net loss for the third quarter was $19.4 million, or $.09 per share, compared with net income of $24.6 million, or $.10 per share (diluted), in the same quarter in 1999, and with net income of $55.9 million, or $.22 per share (diluted), in the second quarter of 2000.
During the third quarter, Broadcom announced three key acquisitions -- Altima Communications, Inc., Silicon Spice Inc. and NewPort Communications, Inc. -- and closed a fourth acquisition, Innovent Systems, Inc., first announced in June. The Altima transaction also closed within the quarter. All four acquisitions will be accounted for under the purchase method of accounting.
``The 30 percent sequential revenue increase we experienced this quarter was the result of continued strong momentum in the broadband markets we serve,'' said Dr. Henry T. Nicholas III, President and CEO of Broadcom Corporation. ``We saw brisk demand across our business lines, from set-top boxes and cable modems to enterprise networking equipment.''
``This across-the-board demand underscored a trend that we are helping to drive: the rapid convergence of broadband
technologies and markets,'' Nicholas said. ``A good example of this was our introduction during the quarter of a groundbreaking single-chip cable modem solution that brings together a range of capabilities, including those for set-top boxes, cable modems, home networking, Voice over Internet Protocol and Ethernet connectivity. This product, the BCM3352, allows cable operators worldwide to provide residential gateways capable of delivering four lines of primary line digital telephone, IP video, home networking and `always on' cable modem Internet services over cable systems and home phone lines.''
During the quarter, Broadcom significantly expanded its wide area networking (WAN) offerings, announcing the acquisitions of NewPort Communications and Silicon Spice. At the recent Networld+Interop industry trade show, Broadcom demonstrated
NewPort's 2.5 Gigabit per second (Gbps) OC-48 and 10 Gbps OC-192 SONET transceivers. Together these products have
garnered 37 design wins with leading networking OEMs. The company also demonstrated Silicon Spice's reconfigurable
communications processor, showing superior Voice over IP (VoIP) capabilities when paired with both Broadcom's
internally-developed technology and telephony software gained last year in the acquisition of HotHaus Technologies.
The Silicon Spice and NewPort Communications acquisitions closed in early October. On October 17, Broadcom further extended its portfolio of WAN products, technologies and expertise, announcing the acquisition of Allayer Communications, a leading developer of high-performance enterprise and optical networking communications chips. Allayer's switch technology supports both 1 Gigabit and 10 Gigabit-per-second Ethernet speeds, and serves as the metropolitan area network (MAN) intersection between
access (IP-based) networks and transport (SONET-based) networks.
In enterprise networking, Broadcom made a number of significant announcements during the quarter, including the introduction of its third generation Gigabit Ethernet over copper transceiver, a product which integrates two 10/100/1000 ports on a single chip. Broadcom is the dominant market leader in Gigabit Ethernet over copper, with nearly a million ports of transceivers shipped. This
leadership position was further bolstered by the announcement in July that Apple Computer will use Broadcom's Gigabit Ethernet transceiver as a standard part on all of the computer maker's new dual-processor PowerMac G4 systems.
Additionally in the networking area, Broadcom demonstrated the world's fastest e-Commerce security processor, another example of fruits of an earlier acquisition (BlueSteel Networks).
To better serve the small and medium-sized business networking market, Broadcom acquired Altima Communications, which focuses on small business 10/100 Ethernet switches, repeaters and transceivers. These products are designed and optimized for the cost-sensitive, value-oriented customer, with an emphasis on low power consumption, small OEM product footprint, and low total system cost. In this market segment, Broadcom also delivered new 5-port and 8-port expandable 10/100 ROBOswitch-plus family of Ethernet Switch-on-a-Chip products.
On October 4, Broadcom announced the acquisition of Element 14, Inc., a leading developer of high port density, low power DSL chipsets. U.K.-based Element 14 is developing what is anticipated to be the industry's first 12-port, full-rate ADSL solution for the central office (CO). The acquisition is expected to close in the current quarter.
``We believe that the combination of Broadcom's existing leadership position in VDSL with Element 14's ADSL capabilities will provide our markets with the most comprehensive product portfolio available for copper twisted pair broadband delivery,'' Nicholas concluded.
Broadcom's restated historical consolidated financial statements for 1999, reflecting the effects of the four pooling-of-interest
acquisitions completed in 2000 to date, were reported on a Form 8-K/A filed with the Securities and Exchange Commission on
July 10, 2000. Broadcom's unaudited pro forma combined financial statements including the effects of the Innovent Systems
acquisition were reported on a Form 8-K/A filed with the SEC on October 2, 2000.
About Broadcom
Broadcom Corporation is the leading provider of highly integrated silicon solutions that enable broadband digital transmission of
voice, video, and data. Using proprietary technologies and advanced design methodologies, the company designs, develops and
supplies integrated circuits for a number of the most significant broadband communications markets, including the markets for
cable set-top boxes, cable modems, high-speed local, metropolitan and wide area networks, home networking, Voice over Internet
Protocol (VoIP), carrier access, residential broadband gateways, direct broadcast satellite and terrestrial digital broadcast, optical
networking, digital subscriber lines (xDSL) and wireless communications. Broadcom is headquartered in Irvine, Calif., and can be
contacted at 949-450-8700 or at www.broadcom.com. |
