JPMorgan Tech Conference: Broadcom CEO's Blunt Message About Predictable Pain
Why mince words, when you can mince others?
Henry Nicholas, CEO of Broadcom (BRCM), was his typical outspoken self when answering beaten-down investors' questions at the JPMorgan H&Q Tech Conference. "You're all to blame, dammit," teased Nicholas. Fast and furious, Nicholas went through expectations of his upcoming quarters, explaining that year-over-year comparisons aren't going to look good because of stellar third and fourth quarters of 2000 that came from "selling to companies that never should have existed."
Investors laughed through the pain as Nicholas quickly sketched out the scenario that saw the red-hot networking sector turn ice cold. All those start-ups with their $100 million in year 2000 funding bought their Cisco (CSCO) equipment, "used it for 10 minutes and are now reselling it for 50 cents on the dollar in the market. They're spending your money."
Stop, you're killing me!Nicholas reiterated that revenue and profit will decline quarter over quarter because of "general weakness in the U.S. economy." Broadcom is still suffering as its customers work through inventory and delay their orders. Nicholas says he thinks demand could restart at the end of this year.
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