Oct. 21, 2014, 4:12 PM
Oct. 20, 2014, 5:35 PM
Oct. 10, 2014, 9:59 AM
- Microchip's (MCHP -12.5%) calendar Q3 warning, which was accompanied by a declaration that it believes "another industry correction has begun and that this correction will be seen more broadly across the industry in the near future," is taking a heavy toll on chip stocks (SOXX -5.5%).
- Intel (INTC -4.2%) and many other chipmakers have joined the several firms that sold off AH yesterday in going in the same direction as Microchip: MU -5.8%. FSL -8.5%. BRCM -3.6%. SWKS -7.5%. RFMD -6.2%. XLNX -4.9%. MXIM -5%. AMBA -5.5%. IDTI -6.7%. CAVM -7.4%. AVGO -10.2%. SMTC -4.3%. SYNA -4.1%. POWI -6.9%.
- Chip equipment makers are also getting hit: AMAT -3.5%. KLAC -3.3%. LRCX -2.3%. UTEK -2.5%. KLIC -2%.
- As Microchip noted in yesterday's warning, the company's very diversified customer base, together with its recognition of distributor revenue on a customer sell-through basis rather than a distributor sell-in basis, often allow it to see industry changes before peers.
- The microcontroller vendor added its warning was driven by a September decline in sales to Chinese clients, and observed it has typically "returned to sequential revenue growth after two quarters" during past downturns.
- Chip stocks have had a good run over the last 12 months, aided by healthy mobile demand and the industry's consolidation wave.
Sep. 24, 2014, 6:46 PM
- Aimed at data centers shuffling huge amounts of traffic, Broadcom's (NASDAQ:BRCM) new StrataXGS Tomahawk chip delivers 3.2Tbps of Ethernet switching capacity - 32 100G ports, 64 40G/50G ports, or 128 25G ports. Dell, Juniper, Brocade, and Huawei are among the switch OEMs that furnished quotes for the PR.
- SDNCentral observes the Tomahawk isn't meant to replace Broadcom's flagship Trident II switching chip (can handle 100+ 10G ports), but instead aims for "an even higher-end market of hyperscale data centers and anything else requiring the highest port counts and lowest latency available."
- The chip also supports network visibility/analytics features that could make it well-suited for a budding software-defined networking (SDN) market. SDN is widely viewed as an opportunity for Broadcom, given deployments often rely on switches running off-the-shelf silicon rather than proprietary ASICs.
- Last week, Cavium's (NASDAQ:CAVM) newly-acquired Xpliant unit showed off a 3.2Tbps switching chip that supports a very high level of programmability (helpful for SDN). Broadcom's chip has begun sampling (mass-production could take some time), while Cavium's is expected to sample in Q4.
Sep. 19, 2014, 9:36 AM
- iFixit's teardown of the iPhone 6 Plus turned up five Qualcomm (NASDAQ:QCOM) chips, up from the three found in last year's teardown of the 5S and nearly matching the six found in certain Galaxy S5 teardowns.
- In addition to the expected Cat-4 LTE baseband modem, a Qualcomm power management IC, RF transceiver, receive-only chip (needed to enable LTE carrier aggregation), and envelope-tracking IC (relatively new, improves battery life) were found in the 6 Plus.
- In-line with rumors and the company's hints, an InvenSense (NYSE:INVN) motion sensor - specifically, a 6-axis gyroscope/accelerometer - was found. That suggests InvenSense has displaced STMicroelectronics (NYSE:STM) as the iPhone's motion sensor supplier.
- Two Skyworks (NASDAQ:SWKS) power amplifier modules are found, including a low-band LTE part. Avago (NASDAQ:AVGO) has both a high-band amplifier module, and an integrated ultra high-band amplifier/FBAR filter module. TriQuint (NASDAQ:TQNT) can claim a 3G amplifier module, and merger partner RF Micro (NASDAQ:RFMD) an antenna switch module.
- Broadcom (NASDAQ:BRCM) appears to remain the iPhone's combo chip supplier (courtesy of a module from partner Murata), and also supplies a touch controller IC. Chipworks thinks Broadcom also has the Wi-Fi slot for the Apple Watch.
- As expected, NXP (NASDAQ:NXPI) is supplying an NFC module and the M8 motion co-processsor, and Cirrus Logic (NASDAQ:CRUS) the audio codec IC. Texas Instruments (NASDAQ:TXN) is providing a touch transmitter IC.
- Moving in response: INVN +1.9%. AVGO +1.5%. STM -3.9%.
Sep. 11, 2014, 5:21 PM
- TiVo (NASDAQ:TIVO) jumped 7.3% today in its biggest gain in more than a year after Broadcom (NASDAQ:BRCM) announced a partnership to supply chips for TiVo's set-top boxes that could expand access to European cable operators.
- The new technology delivers 4x the resolution of a traditional 1080p60 HD screen, and displays life-like resolution speeds and richer color gradation.
- Two BRCM deals in two days - supplying new chips for TiVo’s set-top boxes which will support Ultra HD content, and supplying the same technology to the devices of Vodafone’s German business - may give TiVo access to Kabel Deutschland’s 8M subscribers, Brean Capital analyst Todd Mitchell says.
Sep. 5, 2014, 11:37 AM
- Broadcom's (BRCM +1.2%) 20%+ discount relative to chip peers (due to combo chip and stock compensation worries) is unjustified in light of its "leadership in attractive Networking and Broadband markets that account for 60%+ of sales and 80%+ of profits," says BofA/Merrill's Vivek Arya. His target has been upped by $5 to $50, courtesy of a sum-of-the-parts analysis.
- Arya declares Broadcom is worth $46/share even if the combo chip business is deemed worthless, and that it's worth $54/share is the business can stabilize. "At just 12x PE, 9x 2015E EV/EBTDA, solid 7-8% FCF yield, BRCM's assets look too attractive and transformation too impactful to ignore in a consolidating industry."
- The note shortly follows the launch of a new high-end smartphone/tablet combo chip that doubles 802.11ac Wi-Fi throughput (to 650Mbps) relative to existing parts. Improvements in simultaneous Wi-Fi/Bluetooth performance are also promised.
- Broadcom, which maintains a dominant share of the high-end combo chip market (Qualcomm has been exerting pressure elsewhere), says its new chip will be "shipping in mobile devices" in Q3. That could be a reference to the iPhone 6 and/or the Galaxy Note 4.
Aug. 29, 2014, 7:06 PM
- Broadcom's (NASDAQ:BRCM) WICED Sense kit contains a Bluetooth chip, five MEMS sensors (a gyroscope, an accelerometer, a compass, a barometer, and a temperature/humidity sensor), and related software. An iOS app meant to interact with the kit has been published in the App Store.
- Developers can use the kit to grab sensor data and add Web connectivity to a variety of embedded/wearable devices (the proverbial Internet of Things). Cited examples include sending a text alert if the temperature in an area of one's home rises above a certain level, and improving one's tennis stroke via sensor data obtained by attaching the kit to a racquet.
- Broadcom is hoping the kit sparks broader OEM design activity for its WICED platform, which (with the help of a Wi-Fi modem and Bluetooth bridging), aims to provide connectivity for products ranging from cameras to fridges to thermostats. Qualcomm, Intel, and Texas Instruments are some of the other companies hoping to aggressively grow their embedded chip sales.
Aug. 14, 2014, 2:59 PM
Jul. 24, 2014, 12:45 PM
- Broadcom (BRCM -1.2%) is selling senior notes due 2024 and 2044. It hasn't yet disclosed the offering's size. (prospectus)
- The company says it might use some of the proceeds to redeem up to $400M of its 2.375% 2015 notes. Broadcom had $2.36B in cash at the end of Q2, and $1.4B in debt.
- The offering comes as Broadcom gets set to wind down its baseband processor ops, and cut 2.5K jobs along the way.
Jul. 23, 2014, 10:44 AM
- After "testing the market" to find a buyer for its money-losing baseband chip unit (previous), Broadcom (BRCM +0.8%) has decided to simply wind it down, CEO Scott McGregor stated on the Q2 CC (transcript).
- The chipmaker plans to cut 2.5K jobs (~1/5 of its workforce), and record $230M in charges (mostly cash-based) over the next 12 months. $164M worth of impairment/inventory charges were recorded in Q2.
- Broadcom's baseband ops are only expected to account for $50M-$60M of expected Q3 revenue of $2.1B-$2.25B. In Q2, they accounted for $84M of the company's $781M in mobile/wireless chip sales (combo chip-dominated).
- While mobile/wireless sales fell 8% Q/Q due to baseband weakness, infrastructure/networking sales grew 10% to $635M, aided by healthy Ethernet switching chip demand for data center and carrier hardware - heavy spending by Internet giants has bolstered the former market - and the displacement of internally-developed ASICs at switch OEMs.
- Broadband chip sales rose 12% Q/Q to $625M, thanks to healthy modem and set-top IC sales. Broadcom says it's gaining emerging markets set-top share, and also benefiting from the adoption of advanced features (multi-stream transcoding, extra tuners, the adoption of MoCA home networking).
- Prior Broadcom earnings coverage
Jul. 22, 2014, 5:26 PM
- Broadcom (NASDAQ:BRCM) expects Q3 revenue of $2.1B-$2.25B, in-line with a $2.19B consensus.
- Q2 product gross margin was 55%, +280 bps Q/Q and +290 bps Y/Y, and above guidance of 53.95%-54.95%.
- Q3 product GM is expected to be at 55% (+/- 75 bps), and opex is expected to decline $40M-$60M Q/Q (job cuts related to the baseband exit?).
- Q2 results, PR
Jul. 22, 2014, 4:10 PM
Jul. 21, 2014, 5:35 PM
Jul. 9, 2014, 11:48 AM
- Citing the margin and cash flow benefits that will come from its planned baseband processor exit, Oppeheimer has upgraded Broadcom (BRCM +1.5%) to Outperform, and set a $45 PT.
- Broadcom is up 20% since announcing on June 2 it's exploring a sale or wind-down for its money-losing baseband ops, which had only a 4% share in 2013 thanks to tough competition from Qualcomm/MediaTek.
- Street commentary on the move has generally been positive, though some concerns exist about its impact on Broadcom's Wi-Fi/Bluetooth combo chip sales. Digitimes has reported the Chinese government could acquire in Broadcom's baseband unit in an attempt to lower the dependence of local OEMs on Qualcomm and other foreign suppliers.
Jul. 8, 2014, 4:40 AM
- Samsung (SSNLF), Intel (INTC) and Dell have teamed up to create a standard by which household gadgets communicate with each other, called the Open Interconnect Consortium. The partnership also includes chipmakers Broadcom (BRCM) and Atmel (ATML).
- The new consortium will rival the AllSeen Alliance, a similar framework supported by Qualcomm (QCOM), LG (LGEIY), Microsoft (MSFT) and other companies.
BRCM vs. ETF Alternatives
Broadcom Corp is provider of semiconductors for wired and wireless communications. It provides a portfolio of SoCs that seamlessly deliver voice, video, data and multimedia connectivity in the home, office and mobile environments.
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