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By Asa Fitch
Broadcom Inc. promised an earnings recovery in the current year after the chip maker posted weaker fourth-quarter figures, dented by the protracted U.S. export ban of some items to Chinese telecom giant Huawei Technologies Co.
Broadcom said per-share earnings fell to $1.97 in the final quarter of the financial year ended Nov. 3, compared with $2.64 a year earlier. The more closely watched adjusted earnings, which strip out some one-time items, fell 8% to $5.39 a share, in line with expectations from analysts surveyed by FactSet.
The company gave an upbeat sales forecast for the financial year that began last month, after reporting $5.78 billion in revenue for its most recent quarter. Analysts had expected $5.77 billion. The company projected growth of about 10% to roughly $25 billion, compared with 8% sales growth in the year just ended.
Broadcom shares were higher in after-hours trading.
Chief Executive Hock Tan said he was optimistic about growth in the company's core semiconductor business later in its current fiscal year, and would benefit from its recent acquisition of cybersecurity firm Symantec's enterprise business.
"We continue to believe that our core semiconductor business is bottoming and will return to year over year growth in the second half of our fiscal year," he said.
Broadcom has come off a tumultuous year, buffeted, in part, by U.S. trade tensions with China. The company, in June, cut its sales forecast by $2 billion. Chinese telecom-equipment maker Huawei accounted for about $900 million of Broadcom's sales in its previous fiscal year.
Mr. Tan struck a more upbeat tone in September, saying the chip market had bottomed out. Even so, he warned customer uncertainty was persisting and would weigh on the pace of demand recovery.
(END) Dow Jones Newswires
December 12, 2019 17:17 ET (22:17 GMT)
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