Business Enterprise Segments, Significant Customer and Geographical Information

9 Months Ended

Sep. 30, 2011

Business Enterprise Segments, Significant Customer Supplier And Geographical Information [Abstract]

Business Enterprise Segments, Significant Customer and Geographical Information

10. Business Enterprise Segments, Significant Customer and Geographical Information

Business Enterprise Segments

     Broadcom has three reportable segments consistent with our target markets. Our three reportable segments are: Broadband Communications (Home), Mobile & Wireless (Hand) and Infrastructure & Networking (Infrastructure). Our Chief Executive Officer, who is our chief operating decision maker, or CODM, reviews financial information at the reporting segment level. In January 2011, our Mobile Platforms and Wireless Connectivity businesses were combined for internal reporting purposes, which aligns with our externally reported Mobile & Wireless segment.

     We also report an “All Other” category that primarily includes licensing revenue from our agreement with Verizon Wireless and income from the Qualcomm Agreement since they are principally the result of corporate efforts. “All Other” also includes operating expenses that we do not allocate to our other operating segments as these expenses are not included in the segment operating performance measures evaluated by our CODM. Operating costs and expenses that are not allocated include stock-based compensation, amortization of purchased intangible assets, impairment of goodwill and other long-lived assets, net settlement costs, net restructuring costs, charitable contributions, employer payroll tax on certain stock option exercises, and other miscellaneous expenses related to corporate allocations that were either over or under the original projections at the beginning of the year. We include stock-based compensation and acquisition-related items in the “All Other” category as decisions regarding equity compensation are made at the corporate level and our CODM reviews reportable segment performance exclusive of these charges. In 2010, we reclassified the amortization of acquired inventory valuation step-up from its respective reportable segment into the “All Other” category, as these charges are the result of acquisition accounting and we believe these amounts should not be included when measuring our reportable segments’ operating performance. Prior period amounts have been reclassified to conform to the current period presentation. Our CODM does not review information regarding total assets, interest income or income taxes on an operating segment basis. The accounting policies for segment reporting are the same as for Broadcom as a whole.

     The following tables present details of our reportable segments and the “All Other” category:

	Reportable Segments
	Broadband		Mobile &		Infrastructure &		All
	Communications		Wireless		Networking		Other			Consolidated
	(In millions)
Three Months Ended September 30, 2011
Net revenue	$	526	$	942	$	437	$	52		$	1,957
Operating income (loss)		99		171		144		(144	)		270
Three Months Ended September 30, 2010
Net revenue	$	561	$	798	$	395	$	52		$	1,806
Operating income (loss)		118		165		141		(89	)		335

	Reportable Segments
	Broadband		Mobile &		Infrastructure &		All
	Communications		Wireless		Networking		Other			Consolidated
	(In millions)
Nine Months Ended September 30, 2011
Net revenue	$	1,529	$	2,608	$	1,276	$	156		$	5,569
Operating income (loss)		282		423		440		(471	)		674
Nine Months Ended September 30, 2010
Net revenue	$	1,557	$	1,982	$	1,178	$	156		$	4,873
Operating income (loss)		325		330		433		(274	)		814

Included in the “All Other” category:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
	(In millions)
Net revenue	$	52		$	52		$	156		$	156
Stock-based compensation	$	121		$	113		$	402		$	359
Amortization of purchased intangible assets		21			12			65			36
Amortization of acquired inventory valuation step-up		9			—			19			7
Impairments of long-lived assets		9			2			92			2
Settlement costs (gains), net		27			—			(23	)		4
Restructuring costs, net		17			—			17			—
Charitable contribution		—			—			25			—
Non recurring legal fees		—			—			25			—
Employer payroll tax on certain stock option exercises		2			1			6			5
Miscellaneous corporate allocation variances		(10	)		13			(1	)		17
Total other operating costs and expenses	$	196		$	141		$	627		$	430
Total operating loss for the “All Other” category	$	(144	)	$	(89	)	$	(471	)	$	(274	)

Significant Customer and Geographical Information

     Sales to our significant customers, including sales to their manufacturing subcontractors, as a percentage of net revenue were as follows:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
Five largest customers as a group		44.0	%		39.2	%		41.6	%		36.7	%

     Product revenue derived from shipments to international destinations, as a percentage of product revenue was as follows:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
China (exclusive of Hong Kong)		34.6	%		30.9	%		33.6	%		29.5	%
Hong Kong		26.5			26.4			26.3			26.2
Singapore, Taiwan and Japan		21.9			25.8			22.4			25.2
Europe		1.8			2.4			2.0			2.4
Other		13.7			12.2			14.2			13.7
		98.5	%		97.7	%		98.5	%		97.0	%