Broadcom highlighted mobile video and home networking in product announcements and a rosy business forecast while the company received good news about two former executives.
The communications silicon company has been hurt less than the overall industry by the recession and sees the downturn as a good time to make additional acquisitions, President and CEO Scott McGregor said in his opening remarks at Broadcom's annual financial analyst day. Citing figures from analysts, McGregor said Broadcom's revenue has been forecast to dip by about 5 percent in 2009 while the overall semiconductor industry declines by 11 percent. Meanwhile, he said Broadcom would update its financial forecast later in the day.
After stock markets closed, Broadcom Chief Financial Officer Eric Brandt told the conference that the company expects fourth quarter revenue to rise about 5 percent from the previous quarter, reaching a record $1.32 billion (£800m). Broadcom previously had forecast flat revenue of about $1.25 billion (£760m).
The event broke out in applause in midmorning when Peter Andrew, vice president of corporate communications, passed on the news that a judge had dismissed a criminal case against Broadcom co-founder Henry T. Nicholas III and former Chief Financial Officer William Ruehle. They had been accused of conspiring to inflate Broadcom's earnings by fraudulently backdating employee stock option grants between 1998 and 2003. Judge Cormac Carney dismissed the case because prosecutors improperly intimidated witnesses, according to news reports.
Broadcom also announced a range of products including a high definition multimedia chip for mobile devices, a chipset for "multimedia connected consumer devices" such as tablets, and chips for more power efficient Ethernet equipment in enterprises.
Broadcom supplies components for wired and wireless products in the enterprise, home and mobile markets. It has an advantage over rivals because it can leverage the hardware and software it develops across many types of products, McGregor said.
"None of our competitors have the breadth we do," McGregor said.
The company is focusing on high quality multimedia capabilities in both home electronics and mobile phones, with the DLNA (Digital Living Network Alliance) standard as the common thread to allow transfers of content among them.
On Tuesday, it announced a cellular multimedia chip that can power 1080p high definition video recording, 20-megapixel still photography and the ability to display 1-gigapixel 2D and 3D graphics for gaming. The BCM2763 VideoCore IV will be manufactured using a 40-nanometer technology to result in a chip with low power consumption, Broadcom said. It is shipping to phone makers in sample quantities, and devices with the chip should go on sale in 2011, the company said.
HD playback capability on cell phones allows consumers to record video on a phone and send it to an HDTV for a showing that matches the quality of other programs on the TV, Broadcom executives said. The company already sells a chip for 720p HD video on a cell phone, which is used in the Samsung M850 Instinct HD, sold through Sprint Nextel. With the chip's low power technology, users will be able to shoot video for four to six hours on a typical cell phone battery, the company claimed.
With its 20-megapixel still camera support, the BCM2763 could move cell phones into the territory of high-end digital SLRs (single lens reflex) cameras. Broadcom says its image processing will allow for multiple shots per second with features including image stabilisation and smile detection.
Along with growth in smartphone sales, Broadcom expects an expanding role for "smart feature phones," less expensive handsets that include a web browser, email, a physical or virtual QWERTY keypad and an accelerometer. The company believes smart feature phones could eventually represent between 20 percent and 25 percent of all phones.
Broadcom also announced the Persona platform, an IP (Internet Protocol) communications chipset that will support 3D graphics and high quality audio. The Persona is designed to power devices that give consumers access to digital video recorder, set top box and home automation capabilities as well as high resolution videoconferencing. They could take the form of tablet computers, company executives said.
"Living rooms are not boring anymore. Living rooms are getting connected," McGregor said.
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