Broadcom 4Q Net Slips 4.5% As Sales Ease; Dividend Lifted 11%

   DOW JONES NEWSWIRES 
 

Broadcom Corp.'s (BRCM) fourth-quarter profit slipped 4.5%, failing to match the company's explosive year-ago earnings growth, though the chip maker's top line fell less than expected.

The company also said it will boost its quarterly dividend 11% to 10 cents a share, signaling its desire to satisfy investors during a challenging time for the broader semiconductor sector.

Shares rose 2.7% to $35.26 after hours on the stronger-than-expected core results. The stock was off 24% over the past year through Tuesday's close.

Broadcom's earnings have varied over the past year along with many of its customers' budgets. The company in October issued a pessimistic revenue forecast, citing macroeconomic concerns that had forced some customers to reduce inventory levels, but it later provided more positive guidance, suggesting its top line had not declined as much as previously feared.

Broadcom benefits from its relationship with a wide range of electronics manufacturers, including iPhone maker Apple Inc. (AAPL)and competing smartphone maker Samsung Electronics Co. (005930.SE, SSNHY). Hot-selling mobile phones are a bright spot in the semiconductor industry because of consumers' unabated demand for the latest gadgets.

The company has also moved to equip itself for future demand with a $3.7 billion offer for NetLogic Microsystems Inc. (NETL), a maker of network-focused processors, and its own line of high-bandwidth WiFi devices.

Broadcom posted a profit of $254 million, or 45 cents a share, down from $266 million, or 47 cents a share, a year earlier. Excluding stock-based compensations, settlement costs and other items, earnings fell to 68 cents from 83 cents. Analysts polled by Thomson Reuters were expecting 65 cents.

Revenue slipped 6.4% to $1.82 billion. The company's most recent December forecast called for about $1.8 billion.

Gross product margin edged down to 49.3% from 49.4%.

The chip maker forecast current-quarter revenue between $1.7 billion and $1.8 billion, bracketing analysts' average projection of $1.73 billion.

-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; [e-mail]