$0.19 - Nice!
Broadcom Corporation Reports Record First Quarter Revenue and Profit
IRVINE, Calif.--(BUSINESS WIRE)--April 20, 1999--Broadcom Corporation (Nasdaq: BRCM)
today reported record financial results for the quarter ended March 31, 1999.
Revenue for the first quarter of 1999 was a record $96.3 million, an increase of 172.5% over the
$35.3 million reported in the first quarter of 1998 and an increase of 37.4% over the $70.1 million
reported in the fourth quarter of 1998. Net income was a record $19.3 million, compared with net
income of $7.7 million in the first quarter of 1998.
Diluted earnings per share for the first quarter of 1999 were $.19, based on weighted average shares
outstanding of 101.6 million. This compares with diluted earnings of $.09 per share on 82.6 million
weighted average shares for the same period in 1998. Weighted average shares and per share amounts
have been adjusted to reflect a 2-for-1 stock split, in the form of a 100% stock dividend, effective
February 17, 1999.
"During the quarter, we saw strong growth in sales of our networking products, as well as steady and
continuing growth in our set-top box and cable modem products," said Dr. Henry T. Nicholas III,
Broadcom's President and CEO. "Additionally, we continued to see a broadening of our customer
base, particularly in our networking business unit."
"In this quarter, we continued progress toward our goal of providing enabling silicon solutions for the
convergence of voice, video and data across local and wide area networks. In January, we announced
the acquisition of Maverick Networks, which we expect to provide the technology necessary for the
integration of voice, video and other delay-sensitive traffic into existing data networks. The pending
Maverick acquisition should enable Broadcom to deliver silicon solutions that will drive down the cost
of advanced Layer 3 switching products. The lower cost and higher level of integration will make it
economical to deploy advanced Layer 3 features throughout the mainstream switching market."
"During the quarter, we entered new markets in high speed networking by ramping to volume
production our transceivers for use in Network Interface Cards (NICs) in personal computers and
other networking devices," Nicholas said.
"In March, the cable modem industry reached a significant milestone with the first DOCSIS (Data Over
Cable Service Interface Specification) certification of retail cable modems and DOCSIS qualification of
cable modem termination systems (head-ends) by CableLabs(R)," Nicholas said. "It was an important
milestone for Broadcom as well, since our chipsets were instrumental in the certification. CableLabs'
actions pave the way for the mass rollout of DOCSIS systems and the deployment of new
DOCSIS-based broadband multi-service solutions delivering data, voice and video services."
About Broadcom
Broadcom Corporation is a leading developer of highly integrated silicon solutions that enable
broadband digital data transmission to the home and within the business enterprise. Using proprietary
technologies and advanced design methodologies, the Company has designed and developed integrated
circuits for some of the most significant broadband communications markets, including the markets for
cable set-top boxes, cable modems, high-speed networking products, direct broadcast satellite and
terrestrial digital broadcast, and digital subscriber line (xDSL). Broadcom is headquartered in Irvine,
Calif., and may be contacted at 949/450-8700 or at www.broadcom.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
This release may contain forward-looking statements based on our current expectations, estimates and
projections about our industry, management's beliefs, and certain assumptions made by us. Words such
as "anticipates," "expects," "intends," "plans," "believes" and similar expressions are intended to identify
forward-looking statements. These statements are not guarantees of future performance and are subject
to certain risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results
could differ materially and adversely from those expressed in any forward-looking statements as a result
of various factors.
Important factors that may cause such a difference for Broadcom include, but are not limited to, the
volume of product sales and pricing concessions on volume sales; the timing, rescheduling or
cancellation of significant customer orders; the loss of a significant customer; actual product mix and
price erosion of our existing products; the qualification, availability and pricing of competing products
and technologies and the resulting effects on sales and pricing of our products; our ability to specify,
develop or acquire, introduce and market new products and technologies on a timely basis; the timing
of customer qualification and industry interoperability certification of new products and the risks of
non-qualification or non-certification; the rate of adoption by our customers and end-users of new and
emerging technologies in the high-speed networking, cable set-top box, cable modem, direct broadcast
satellite and terrestrial digital broadcast, and digital subscriber line (xDSL) markets; the rate of adoption
and acceptance of new industry standards in the foregoing markets; intellectual property disputes; the
risks inherent in acquisitions of technologies and businesses, including integration issues, unanticipated
expenditures, employee dissatisfaction, technology disputes, and the risks that the acquisition cannot be
completed successfully or that the anticipated benefits are not realized; difficulties we encounter in
achieving higher levels of design integration and in migrating product designs to smaller geometry
processes; fluctuations in manufacturing yields and other problems or delays in the fabrication,
assembly, testing or delivery of our products; risks and uncertainties associated with international
operations; our ability to retain and hire key executives, technical personnel and other employees in the
numbers, with the capabilities, and at the compensation levels needed to implement our business and
product plans; the quality of our products; the effects on operations and management of business
expansion and facility relocations; the level of orders received that we can ship in a fiscal quarter;
potential business disruptions, claims, expenses and other difficulties resulting from "Year 2000"
problems in computer-based systems used by us, our suppliers or our customers; general economic
conditions and conditions in the markets we address; and other factors.
Our Annual Report on Form 10-K and other Securities and Exchange Commission filings discuss some
of the important risk factors that may affect our business, results of operations and financial condition.
We undertake no obligation to revise or update publicly any forward-looking statements for any
reason.
Broadcom(R) and the pulse logo are trademarks of Broadcom Corporation.
CableLabs(R) is a trademark of Cable Television Laboratories, Inc. ---
BROADCOM CORPORATION
Unaudited Consolidated Statements of Operations
(In thousands, except per share amounts)
Three Months Ended
March 31,
1999 1998
Revenue $ 96,320 $ 35,344
Cost of revenue 39,777 13,832
Gross profit 56,543 21,512
Operating expense:
Research and development 18,301 5,952
Selling, general and
administrative 10,198 3,989
Total operating expense 28,499 9,941
Income from operations 28,044 11,571
Interest and other income, net 1,634 218
Income before income taxes 29,678 11,789
Provision for income taxes 10,387 4,126
Net income $ 19,291 $ 7,663
Basic earnings per share $ .22 $ .14
Diluted earnings per share $ .19 $ .09
Weighted average shares (basic) 86,793 55,979
Weighted average shares (diluted) 101,641 82,559
Consolidated Condensed Balance Sheets
(In thousands)
March 31,
1999 December 31,
(Unaudited) 1998
ASSETS
Current assets:
Cash and cash equivalents $ 73,456 $ 62,629
Short-term investments 47,345 34,344
Accounts receivable, net 42,041 36,917
Inventory 15,284 7,307
Deferred taxes 6,181 6,181
Other current assets 7,178 9,917
Total current assets 191,485 157,295
Property and equipment, net 32,030 28,286
Long-term investments 42,124 42,826
Deferred taxes 5,352 5,352
Other assets 11,364 3,685
Total assets $ 282,355 $ 237,444
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Trade accounts payable $ 28,066 $ 19,586
Wages and related benefits 6,383 2,606
Accrued liabilities 7,331 4,911
Total current liabilities 41,780 27,103
Shareholders' equity 240,575 210,341
Total liabilities and shareholders'
equity $ 282,355 $ 237,444
CONTACT: Investor Relations Contact
Esteban R. Torres
949/585-5663
etorres@broadcom.com
or
Media Contacts
Bill Blanning or Cristine Morris
Corporate Communications Dept.
949/450-8700
blanning@broadcom.com; cmorris@broadcom.com
or
Financial Analyst Contact
William J. Ruehle
Vice President and Chief Financial Officer
949/450-8700
billr@broadcom.com |
