Broadcom Profitable 4th Quarter in a Row

Chip maker Broadcom Corp. on Thursday reported its fourth consecutive quarterly profit, although earnings grew more slowly than expected because of sluggish sales of television set-top boxes around the world and mobile phone handsets in China.

Broadcom earned $49 million, or 14 cents a share, in the third quarter, compared with a loss of $6.3 million, or 2 cents a share, in the same period last year. Revenue rose 52% to $647 million.

For the fourth quarter, Chief Financial Officer Bill Ruehle forecast revenue of $530 million to $540 million, well below the $645 million predicted by analysts surveyed by Thomson First Call. The company did not offer any profit forecasts.

Shares of Irvine-based Broadcom, which rose $2.25 to $30.47 in regular Nasdaq trading, fell to $29.15 after the earnings report was released.

Broadcom is set to benefit from continued demand for set-top boxes, said Chief Executive Alan E. “Lanny” Ross.

Cable and satellite television providers are expected to sell more than 50 million of the boxes in 2007, up from 30 million in 2003, he said.

But customers slowed orders while they worked their way through stocks of products that contain Broadcom chips.

“We’re seeing an inventory correction in set-top boxes, and in cellphone handsets, especially in China,” Ruehle said.

Broadcom has been losing business in its Intel Architecture chipset business since Intel Corp., the world’s largest chip maker, began making its own chipsets for server computers. That will shave $40 million from Broadcom’s revenue in the fourth quarter, after reducing third-quarter revenue by $10 million, Ruehle said.

Dushyant Desai, a semiconductor analyst with C.E. Unterberg in Mountain View, Calif., said that would hurt because the business had brought in as much as $300 million a year in revenue.