Broadcom Shares Fall Amid Slower Sales Growth

PHILADELPHIA (AP) — Shares of Broadcom Corp. plunged Friday as investors were spooked by the chip maker's latest quarterly results and indications that sales may remain stagnant into 2010.

The stock lost $2.67, or 8.7 percent, to $28.06 in midday trading.

Late Thursday, the Irvine, Calif.-based company said its third-quarter earnings fell by half from a year ago. Revenue slid 3 percent.

Results beat analyst expectations, but the company warned that revenue should remain flat from the third quarter going into the holiday season.

"It will be a little uncertain what's going to happen around Christmas with consumer demand," President and CEO Scott A. McGregor said on a conference call with analysts. "We're not economists, so, you know, we can't forecast this as well as maybe some of them can. But there's a little concern about whether Santa's coming this year or not."

Broadcom also cautioned that operating expenses will be $20 million higher in the fourth quarter, with nearly half to come from legal costs related to a stock options backdating case.