Broadcom moved to breakeven in the second quarter, after a loss of USD 251 million or 43 cents a share a year earlier. The result included a number of one-time charges for exiting the cellular baseband market as earlier announced, while last yer Broadcom took a charge for its acquisition of Netlogic. Excluding these, net profit was down slightly, at USD 406 million from USD 436 million a year ago.
Net revenue for the quarter fell 2.3 percent year-on-year but was 2.9 percent higher versus the previous quarter at USD 2.04 billion. Broadband and infrastructure revenue increased but cellular baseband revenue fell more than expected.
Broadcom said it decided to wind down the baseband business rather than pursue a sale of the activities. This will result in a headcount reduction of around 2,250 and the closure of up to 18 locations at the company. Another USD 225 million in restructuring charges are expected over the next 12 months. The affected employees were informed in July.
For the third quarter, Broadcom forecast revenue of USD 2.10-2.25 billion and a sequential improvement in the gross margin to around 51.4 percent.
