Apple Inc. sold 37 million iPhones and 15 million iPads during its record holiday quarter. Those were also happy numbers for Irvine-based Broadcom Corp., which makes microchips for the popular Apple devices and many others.
Broadcom reported a better-than-expected fourth quarter Tuesday, beating Wall Street estimates for quarterly revenue and earnings per share despite enduring profit and sales declines from the same period a year earlier.
The company's stock rose 2%, or $0.68, to $35.02 in after-hours trading following its earnings announcement. Since Jan. 1, the company's stock has risen 17%, a welcome jump after a rough 2011 that saw that company's stock drop 33%, from $43 to $29.
The market for semiconductor chips was bumpy in 2011, and Broadcom saw declining consumer interest in digital television sets, one of the products for which it makes microchips. The industry has also been recovering from major flooding in Thailand that led to a shortage of hard disk drives used by many computing devices.
Still, company executives were optimistic, projecting revenue for the current quarter of between $1.7 billion and $1.8 billion; analysts expect $1.73 billion.
"Broadcom delivered solid results in 2011, as we gained significant market share, secured record design wins across our businesses, and delivered record revenue and cash flow from operations," Scott McGregor, Broadcom's chief executive, said in a statement. "We will remain focused on product innovation and engineering execution that position us to grow faster than the industry."
Broadcom has about 20 lines of businesses, making communications chips for smartphones, tablets, televisions, set-top boxes and large-scale Internet servers. To stay competitive in the fast-moving electronics industry, the company often buys smaller firms to acquire their chip design technology and know-how, and wraps the new teams into its main design business to work alongside other engineers from around the globe. It has acquired 46 companies since its founding in 1991.
The company reported $1.82 billion in revenue for the quarter, higher than the Wall Street consensus of $1.8 billion but a 6.4% decrease from the same period a year earlier. Its adjusted earnings per share were 68 cents — Wall Street expected 65 cents — a 25% decline from the fourth quarter of 2010.