The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Broadcom beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank, and GAAP earnings per share dropped.
Gross margins improved, operating margins improved, and net margins shrank.
Broadcom logged revenue of $1.82 billion. The 35 analysts polled by S&P Capital IQ predicted sales of $1.80 billion. Sales were 3.8% lower than the prior-year quarter's $1.95 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $0.68. The 32 earnings estimates compiled by S&P Capital IQ averaged $0.65 per share on the same basis. GAAP EPS of $0.45 for Q4 were 3.5% lower than the prior-year quarter's $0.47 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 50.9%, 170 basis points better than the prior-year quarter. Operating margin was 15.5%, 90 basis points better than the prior-year quarter. Net margin was 14.0%, 10 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.73 billion. On the bottom line, the average EPS estimate is $0.53.
Next year's average estimate for revenue is $7.69 billion. The average EPS estimate is $2.74.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 884 members out of 961 rating the stock outperform, and 77 members rating it underperform. Among 241 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 229 give Broadcom a green thumbs-up, and 12 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Broadcom is outperform, with an average price target of $39.98.
New mobile devices are changing the game -- and potential profitability -- at many semiconductor companies. Some will fail, some will tread water, and those in the right devices will shine. Where does Broadcom fit in? Who will lead going forward? Check out "3 Hidden Winners of the iPhone, iPad, and Android Revolution." Click here for instant access to this free report.
- Add Broadcom to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.