On Broadcom's strong Q4 reporting and outlook on mobile, analyst Tom Sepenzis considers encouraging with concern over Apple unit weakness for the December quarter, handset inventory issues in China and Galaxy Note 7 impact on Samsung Electronics existing among current sentiment.
With respect to Qualcomm (QCOM -0.6%), notes a lessened market share at Apple and forthcoming ramp of Samsung's Galaxy S8 combined with the Broadcom guidance mark positive take-aways for the name.
Highlighting enterprise storage growth (Broadcom outlook supports 20% Q/Q increase ignoring any seasonal weakness) and solid-state drive momentum Broadcom management sees increasingly displacing usage of hard-disk drives, conveys favorability for Silicon Motion Technology (SIMO -0.9%) and Marvell Technology (MRVL +0.8%) as both are exposed to the consumer storage arena. Considers even further benefit to Marvell Technology given its additional exposure within the HDD market, another segment that despite increasing SSD usage, also remains strong.
Silicon Motion Technology (NASDAQ:SIMO) now expects Q3 sequential revenue growth in the range of 11%-13%, significantly higher than its original guidance range of an increase of 0%-5% that the company issued on July 22, 2016.
Additionally, gross margin (non-GAAP) is expected to be in the range of 48%-49%, above the company's original guidance range of 46%-48%.
The Company will release its full Q3 results after the market closes on Oct. 27, 2016.