dropped sharply after the company's chief executive indicated that a slowdown in sales could be looming.
The shares fell $7.81, or 8.5%, to $84.75 in recent
trading after Henry Nicholas, Broadcom's chief executive, said the company's growth isn't living up to previous guidance. The integrated circuits maker has traded as low as $79.75 today.
"As a result of expansion into new markets and as the result of our increasing silicon content, we are still seeing growth," Nicholas said. "We are still however not expecting the amount of growth that we have given in our previous guidance to the investment community. But we still see growth in these markets and still expect that growth to continue quarter on quarter for the rest of this year."
On Jan. 23, the company said it expected
first-quarter revenue to increase by 22% to 23% sequentially, which would total about $459 million, higher than analysts' projections of $405.2 million. At the time, the company forecast earnings of 33 cents for the quarter, slightly higher than Wall Street's prediction of 32 cents a share.
Broadcom also said it expected 2001 revenue to double from the $1.1 billion in 2000. The company also said earnings should be between $1.50 and $1.60 a share for the year, up from $1.04 in 2000. Wall Street was expecting earnings of $1.44 a share and revenue of $1.93 billion at the time.
Nineteen analysts polled by
First Call/Thomson Financial
are calling for the company to earn 34 cents in the first quarter. Analysts now expect a profit of $1.56 for the year.