Irvine-based chipmaker Broadcom Corp. after the close of trading today reported fourth quarter revenue and adjusted profits that beat Wall Street expectations and provided a revenue outlook for the current quarter in line with expectations.
The company posted revenue in the recently ended quarter of $2.14 billion, up 3.8% from a year earlier and beating analyst estimates of $2.06 billion.
Adjusted profits hit $562 million, up 53.5% from a year ago and topping Wall Street expectations of $515 million.
For the year, Broadcom recorded record revenue of $8.43 billion, up 1.5% over 2013.
Adjusted profits topped $1.4 billion, up 23.6%.
Broadcom specializes in communication chips that go into tablets, smartphones, set-top boxes, broadband modems, networking gear and other products.
The company entered this year with an eye on gaining market share in the connected car and data center infrastructure segments, as well as the booming Internet of Things market.
The latter segment is forecast to hit $7.1 trillion in sales by 2020, up 273% over 2013, from related equipment and components that allow devices to communicate with each other remotely, according to Massachusetts-based market researcher International Data Corp.
Two storylines dominated headlines for Broadcom last year: its abrupt exit from the baseband chip business long dominated by Qualcomm Corp. in San Diego, and its planned headquarters move to the Great Ballpark Neighborhood. The baseband exit includes plans to cut 20% of its global workforce and close or consolidate 18 locations as part of a companywide restructuring.
Baseband chips serve as the technical brains of mobile phones.
As part of the headquarters move, Broadcom purchased land to build a 1.1-million-square-foot corporate home in the mixed-use, masterplanned community next to Great Park at the former Marine Corps Air Station El Toro. Construction is slated to begin after the land acquisition closes in the next few months.
Broadcom provided guidance on revenue, gross margins, and research and development for the current quarter. The company projected sales between $2 billion and $2.07 billion in the March quarter, in line with analyst expectations of $2.01 billion.
Gross margins, a key measure for technology companies, are projected to be 54.6% to 54.7% compared to 54.7% in the December quarter.
Spending on research and development is projected to be between $535 million and $555 million, up from $530 million in the recently ended quarter.
Broadcom also announced that its board approved a quarterly dividend of 14 cents a share.
The company’s shares were up nearly 3% in after-hours trading, and about another 4% midday Friday, to a market value of $25.5 billion.