Saturday, October 2, 1999
Big Chip Order
Technology: Irvine-based niche
leader looks to New York cable company's plan for 3
million set-top boxes.
By ERIK SCHATZKER, Bloomberg
Broadcom Corp. expects to supply
semiconductors for up to 3 million cable television set-top
boxes for Cablevision Systems Corp., the largest
cable-TV company in the New York metropolitan area,
Broadcom Chief Executive Henry Nicholas said Friday.
Cablevision Systems is buying the set-top boxes from Sony
Corp., which is likely to call on Broadcom to supply
many if not all of the semiconductors, Nicholas said
in an interview at a conference in Squaw Valley.
Irvine-based Broadcom is the No. 1 maker of semiconductors for
digital set-top boxes and cable modems.
confident that we'll end up with a very significant part of
the silicon content in that box," Nicholas said in an
interview at Telecosm '99.
Broadcom, which started by
making chips that speed Internet access for homes and
businesses and for digital TV converters, stands to benefit
as cable operators move to combine those functions
in a single box.
Last month, Cablevision agreed
to pay Sony $1 billion for 3 million of these boxes,
which use three or four chips to combine phone access,
interactive programming, more channels and Internet access on
Nicholas said the agreement is
"material and important" for Broadcom. It won't be the
company's biggest, though. Broadcom company sells more to
Motorola Inc., which buys semiconductors for its cable
modems, and General Instrument Corp., a maker of set-top
Motorola last month agreed to buy General
Instrument, a move Broadcom expects to benefit from. Broadcom
shares fell after the acquisition was unveiled amid
concern that the company would lose General Instrument
sales to Motorola's chip division.
The share drop
"puzzled me," Nicholas said. The acquisition "lets us take
a lot of the things we do with Motorola and blend
them with General Instrument."
On Friday, Broadcom
shares rose $3.50 to $112.50. The stock has gained 86%
this year, giving the company the currency to make
five acquisitions since June.
Copyright 1999 Los
Angeles Times. All Rights Reserved
archives of the Los Angeles Times for similar stories
ELECTRONICS INDUSTRY -- ORANGE COUNTY, BROADCOM CORP. You
will not be charged to look for stories, only to
Whisper.com---That's the site---same site that
often tells you the wrong earnings date----and adding
$.05 on to the consensus estimate of $0.20 for the
quarter (First Call)is really "stretching it"
I can never tell what a stcok is going to do in
terms of price, but the CEO has come out and said that
growth should be over 40% each yr for the next 5 yrs.
With those numbers, if he is conservative like most
CEO's are, the stock price has truly a long ways to go.
They just recently announced another stock split. I
believe that they would not have done this if this
current qtr and next qtr were not going to surprise in a
big way. They are currently the leader in fiber
Another way to look at it is if CSCO paid
7 billion for Cerent, which has less than 100
million in revenues - then what would JDSU be worth (it
will have over a billion in revs this fiscal yr). Then
JDSU could be worht in mkt cap anywhere from 35 to 70
billion based on revenues and leadership. I have purchsed
this as an investment - so I do not really pay much
attention to price fluctuation - I just try to keep up with
the news. Many sites out there to give you news on
JDSU and BRCM - I love them both and in my opinion
there is a lot of long term upside for both of them. I
hope that this gave you some insight. Good luck
ing in regards to BRCM and PMCS:
are other competitors in communications
In our view, the article contains a
errors particularly identifying the companies
competitors in network processing. Intel's competitors
LSI Logic and Lucent (on the application specific
and Broadcom, PMC Sierra, and Vitesse (on the
product side)- we do not believe this market is
important to Intel because of its size .
analyst semi-conductors, Merrill Lynch---today in
response to the Barron's article.
as of 4 October concerning
"Broadcom (BRCM, C-1-1-9, $112 �) We are expecting another
solid quarter from Broadcom, with estimated net income
of $22.9 million or $0.20 per share, up 351% YoY.
Revenues are forecast to increase by 141% YoY and 9%
sequentially to $126 million. We expect networking product
revenues to increase by 158% to $58 million, and set-top
box product revenues to increase by 159% to $48
million. We�re looking for previously announced ASIC wins,
especially at Nortel, to begin turning up in the top line
for the September quarter. Our full-year 1999 EPS
estimate stands at $0.75, and our intermediate and
long-term investment ratings are Buy."
with all due respect average volume is just that.
take a look at the daily volume for the last 2 weeks
on this stock and it doesn't paint a picture of a
resounding confirmation of support at this price level.
i also agree traders are anxious to enter given the
"pummeled" bond market. i guess that's my point that until
we see a breakout supported by a few 2.5mm - 3.0mm
volume days most traders are on the sideline while we
move up on moderate volume.