10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

__________________________________ 

Form 10-Q

__________________________________

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2013

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from          to         

Commission file number: 000-23993

 __________________________________

Broadcom Corporation

(Exact Name of Registrant as Specified in Its Charter)

__________________________________

California	33-0480482
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

5300 California Avenue

Irvine, California 92617-3038

(Address of Principal Executive Offices) (Zip Code)

(949) 926-5000

(Registrant’s telephone number, including area code)

__________________________________ 

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨ (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

As of March 31, 2013 the registrant had 521 million shares of Class A common stock, $0.0001 par value, and 50 million shares of Class B common stock, $0.0001 par value, outstanding.

BROADCOM CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE THREE MONTHS ENDED MARCH 31, 2013

TABLE OF CONTENTS

	Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements	2
Unaudited Condensed Consolidated Balance Sheets at March 31, 2013 and December 31, 2012	2
Unaudited Condensed Consolidated Statements of Income for the Three Months ended March 31, 2013 and 2012	3
Unaudited Condensed Consolidated Statements of Comprehensive Income for the Three Months ended March 31, 2013 and 2012	4
Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months ended March 31, 2013 and 2012	5
Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3. Quantitative and Qualitative Disclosures about Market Risk	32
Item 4. Controls and Procedures	32
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	33
Item 1A. Risk Factors	33
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	41
Item 3. Defaults upon Senior Securities	42
Item 4. Mine Safety Disclosures	42
Item 5. Other Information	42
Item 6. Exhibits	42

Broadcom^® and the pulse logo are among the trademarks of Broadcom Corporation and/or its affiliates in the United States, certain other countries and/or the EU. Any other trademarks or trade names mentioned are the property of their respective owners.

^©2013 Broadcom Corporation. All rights reserved.

1

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

BROADCOM CORPORATION

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31, 2013			December 31, 2012
	(In millions)
ASSETS
Current assets:
Cash and cash equivalents	$	1,742		$	1,617
Short-term marketable securities	727			757
Accounts receivable, net	751			740
Inventory	523			527
Prepaid expenses and other current assets	154			140
Total current assets	3,897			3,781
Property and equipment, net	493			485
Long-term marketable securities	1,457			1,348
Goodwill	3,729			3,726
Purchased intangible assets, net	1,722			1,786
Other assets	102			82
Total assets	$	11,400		$	11,208
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	300		$	300
Accounts payable	661			549
Wages and related benefits	170			241
Deferred revenue and income	23			22
Accrued liabilities	521			570
Total current liabilities	1,675			1,682
Long-term debt	1,394			1,393
Other long-term liabilities	299			294
Commitments and contingencies
Shareholders’ equity:
Common stock	—			—
Additional paid-in capital	12,402			12,403
Accumulated deficit	(4,340		)	(4,531		)
Accumulated other comprehensive loss	(30		)	(33		)
Total shareholders’ equity	8,032			7,839
Total liabilities and shareholders’ equity	$	11,400		$	11,208

See accompanying notes.

2

BROADCOM CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended
	March 31,
	2013			2012
	(In millions, except per share data)
Net revenue:
Product revenue	$	1,954		$	1,770
Income from Qualcomm Agreement	43			52
Licensing revenue	8			5
Total net revenue	2,005			1,827
Costs and expenses:
Cost of product revenue	988			918
Research and development	615			546
Selling, general and administrative	179			179
Amortization of purchased intangible assets	15			17
Impairments of long-lived assets	10			28
Restructuring costs, net	—			3
Settlement costs	—			86
Total operating costs and expenses	1,807			1,777
Income from operations	198			50
Interest expense, net	(8		)	(6		)
Other income (expense), net	3			(1		)
Income before income taxes	193			43
Provision for (benefit of) income taxes	2			(45		)
Net income	$	191		$	88
Net income per share (basic)	$	0.34		$	0.16
Net income per share (diluted)	$	0.33		$	0.15
Weighted average shares (basic)	570			548
Weighted average shares (diluted)	585			570
Dividends per share	$	0.11		$	0.10

The following table presents details of total stock-based compensation expense included in each functional line item in the unaudited condensed consolidated statements of income above:

	Three Months Ended
	March 31,
	2013		2012
	(In millions)
Cost of product revenue	$	7	$	9
Research and development	99		94
Selling, general and administrative	34		47

See accompanying notes.

3

BROADCOM CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

	Three Months Ended
	March 31,
	2013		2012
	(In millions)
Net income	$	191	$	88
Other comprehensive income, net of tax:
Foreign currency translation adjustments, net of $0 tax in 2013 and 2012	2		20
Unrealized gains on marketable securities, net of $0 tax in 2013 and 2012	1		3
Other comprehensive income	3		23
Comprehensive income	$	194	$	111

See accompanying notes.

4

BROADCOM CORPORATION

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	Three Months Ended
	March 31,
	2013			2012
	(In millions)
Operating activities
Net income	$	191		$	88
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	39			28
Stock-based compensation expense	140			150
Acquisition-related items:
Amortization of purchased intangible assets	58			54
Impairments of long-lived assets	10			28
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	(11		)	(51		)
Inventory	4			38
Prepaid expenses and other assets	(34		)	(11		)
Accounts payable	109			52
Deferred revenue and income	(2		)	(9		)
Accrued settlement costs	(3		)	87
Other accrued and long-term liabilities	(113		)	(86		)
Net cash provided by operating activities	388			368
Investing activities
Net purchases of property and equipment	(41		)	(74		)
Net cash paid for acquired companies	—			(3,393		)
Purchases of marketable securities	(619		)	(334		)
Proceeds from sales and maturities of marketable securities	539			706
Net cash used in investing activities	(121		)	(3,095		)
Financing activities
Repurchases of Class A common stock	(107		)	—
Dividends paid	(63		)	(55		)
Payment of assumed contingent consideration	—			(53		)
Proceeds from issuance of common stock	68			62
Minimum tax withholding paid on behalf of employees for restricted stock units	(40		)	(48		)
Net cash used in financing activities	(142		)	(94		)
Increase (decrease) in cash and cash equivalents	125			(2,821		)
Cash and cash equivalents at beginning of period	1,617			4,146
Cash and cash equivalents at end of period	$	1,742		$	1,325

See accompanying notes.

5

BROADCOM CORPORATION

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Summary of Significant Accounting Policies

Our Company

Broadcom Corporation (including our subsidiaries, referred to collectively in this Report as “Broadcom,” “we,” “our” and “us”) is a global leader and innovator in semiconductor solutions for wired and wireless communications. Broadcom^® products seamlessly deliver voice, video, data and multimedia connectivity in the home, office and mobile environments. We provide the industry’s broadest portfolio of state-of-the-art system-on-a-chip, or SoC, and embedded software solutions.

Basis of Presentation

The interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, for interim financial information and with the instructions to Securities and Exchange Commission, or SEC, Form 10-Q and Article 10 of SEC Regulation S-X. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto for the year ended December 31, 2012, included in our 2012 Annual Report on Form 10-K filed with the SEC on January 30, 2013, referred to as our 2012 Annual Report.

The interim condensed consolidated financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly our results of operations and financial position for the interim periods. The results of operations for the three months ended March 31, 2013 are not necessarily indicative of the results to be expected for future quarters or the full year.

For a complete summary of our significant accounting policies, please refer to Note 1, "Summary of Significant Accounting Policies", in Part IV, Item 15 of our 2012 Annual Report. There have been no material changes to our significant accounting policies during the three months ended March 31, 2013.

Use of Estimates

The preparation of financial statements in accordance with United States generally accepted accounting principles, or GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the financial statements and the reported amounts of total net revenue and expenses in the reporting periods. We regularly evaluate estimates and assumptions related to revenue recognition, rebates, allowances for doubtful accounts, sales returns and allowances, warranty obligations, inventory valuation, stock-based compensation expense, goodwill and purchased intangible asset valuations, strategic investments, deferred income tax asset valuation allowances, uncertain tax positions, tax contingencies, self-insurance, restructuring costs or reversals, litigation and other loss contingencies. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. The actual results we experience may differ materially and adversely from our estimates. To the extent there are material differences between the estimates and actual results, our future results of operations will be affected.

6

2. Supplemental Financial Information

Inventory

The following table presents details of our inventory:

	March 31, 2013		December 31, 2012
	(In millions)
Work in process	$	205	$	187
Finished goods	318		340
	$	523	$	527

Accrued Liabilities

The following table presents details of our accrued liabilities included in current liabilities:

	March 31, 2013		December 31, 2012
	(In millions)
Accrued rebates	$	319	$	383
Accrued royalties	16		21
Accrued settlement charges	70		68
Accrued legal costs	17		15
Accrued taxes	19		16
Warranty reserve	11		13
Other	69		54
	$	521	$	570

Other Long-Term Liabilities

The following table presents details of our other long-term liabilities:

	March 31, 2013		December 31, 2012
	(In millions)
Deferred rent	$	52	$	54
Accrued taxes	82		67
Deferred tax liabilities	42		45
Accrued settlement charges	58		58
Deferred revenue	44		47
Other long-term liabilities	21		23
	$	299	$	294

7

Accrued Rebate Activity

The following table summarizes the activity related to accrued rebates:

	Three Months Ended
	March 31,
	2013			2012
	(In millions)
Beginning balance	$	383		$	317
Charged as a reduction of revenue	161			147
Reversal of unclaimed rebates	(6		)	(3		)
Payments	(219		)	(159		)
Ending balance	$	319		$	302

Computation of Net Income Per Share

Net income per share (basic) is calculated by dividing net income by the weighted average number of common shares outstanding during the year. Net income per share (diluted) is calculated by adjusting outstanding shares, assuming any dilutive effects of stock options and restricted stock units calculated using the treasury stock method. Under the treasury stock method, an increase in the fair market value of our Class A common stock results in a greater dilutive effect from outstanding stock options, stock purchase rights and restricted stock units. Additionally, the exercise of employee stock options and stock purchase rights and the vesting of restricted stock units results in a further dilutive effect on net income per share.

The following table presents the computation of net income per share:

	Three Months Ended
	March 31,
	2013		2012
	(In millions, except per share data)
Numerator: Net income	$	191	$	88
Denominator for net income per share (basic)	570		548
Effect of dilutive securities:
Stock awards	15		22
Denominator for net income per share (diluted)	585		570
Net income per share (basic)	$	0.34	$	0.16
Net income per share (diluted)	$	0.33	$	0.15

Net income per share (diluted) does not include the effect of anti-dilutive common share equivalents resulting from outstanding equity awards. There were 21 million and 27 million anti-dilutive common share equivalents in the three months ended March 31, 2013 and 2012, respectively.

Income from the Qualcomm Agreement

For a discussion of income from our April 2009 agreement with Qualcomm Incorporated, or the Qualcomm Agreement, please see our 2012 Annual Report. The income from the Qualcomm Agreement is non-recurring and will terminate in April 2013.

Supplemental Cash Flow Information

In the three months ended March 31, 2013 we accrued $1 million related to stock option exercises that had not settled by March 31, 2013. In the three months ended March 31, 2013, we paid $27 million for capital equipment that was accrued as of December 31, 2012 and had billings of $30 million for capital equipment that were accrued but not yet paid as of March 31, 2013.

8

3. Fair Value Measurements

Our financial instruments consist principally of cash and cash equivalents, short- and long-term marketable securities, accounts receivable, accounts payable and long-term debt. The fair value of a financial instrument is the amount that would be received in an asset sale or paid to transfer a liability in an orderly transaction between unaffiliated market participants. Assets and liabilities measured at fair value are categorized based on whether or not the inputs are observable in the market and the degree that the inputs are observable. The categorization of financial instruments within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) defined as follows:

Level 1: Inputs are based on quoted market prices for identical assets or liabilities in active markets at the measurement date.

Level 2:Inputs include quoted prices for similar assets or liabilities in active markets and/or quoted prices for identical or similar assets or liabilities in markets that are not active near the measurement date.

Level 3:Inputs include management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are unobservable in the market and significant to the instrument’s valuation.

The fair value of the majority of our cash equivalents and marketable securities was determined based on “Level 1” inputs. The fair value of certain marketable securities and our long-term debt were determined based on “Level 2” inputs. The valuation techniques used to measure the fair value of our “Level 2” instruments were valued based on quoted market prices or model driven valuations using significant inputs derived from or corroborated by observable market data. We do not have any marketable securities in the “Level 3” category. We believe that the recorded values of all our other financial instruments approximate their current fair values because of their nature and respective relatively short maturity dates or durations.

Instruments Measured at Fair Value on a Recurring Basis. The following tables present our cash and marketable securities’ costs, gross unrealized gains, gross unrealized losses and fair value by major security type recorded as cash and cash equivalents or short-term or long-term marketable securities:

	March 31, 2013
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cash and Cash Equivalents		Short-Term Marketable Securities		Long-Term Marketable Securities
	(In millions)
Cash	$	221	$	—	$	—	$	221	$	221	$	—	$	—
Level 1:
Bank and time deposits	1,173		—		—		1,173		1,143		20		10
Money market funds	300		—		—		300		300		—		—
U.S. treasury and agency obligations	850		1		—		851		3		176		672
Corporate bonds	1		—		—		1		—		1		—
Subtotal	2,324		1		—		2,325		1,446		197		682
Level 2:
Commercial paper	182		—		—		182		49		133		—
Corporate bonds	1,140		2		—		1,142		26		374		742
Asset-backed securities and other	56		—		—		56		—		23		33
Subtotal	1,378		2		—		1,380		75		530		775
Level 3:
None	—		—		—		—		—		—		—
Total	$	3,923	$	3	$	—	$	3,926	$	1,742	$	727	$	1,457

9

	December 31, 2012
	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Cash and Cash Equivalents		Short-Term Marketable Securities		Long-Term Marketable Securities
	(In millions)
Cash	$	213	$	—	$	—		$	213	$	213	$	—	$	—
Level 1:
Bank and time deposits	904		—		—			904		884		20		—
Money market funds	250		—		—			250		250		—		—
U.S. treasury and agency obligations	936		1		—			937		—		201		736
Corporate bonds	1		—		—			1		—		1		—
Subtotal	2,091		1		—			2,092		1,134		222		736
Level 2:
Commercial paper	432		—		—			432		270		162		—
Corporate bonds	921		2		(1		)	922		—		351		571
Asset-backed securities and other	63		—		—			63		—		22		41
Subtotal	1,416		2		(1		)	1,417		270		535		612
Level 3:
None	—		—		—			—		—		—		—
Total	$	3,720	$	3	$	(1	)	$	3,722	$	1,617	$	757	$	1,348

There were no transfers between Level 1, Level 2 or Level 3 securities in the three months ended March 31, 2013. All of our long-term marketable securities had maturities of between one and three years in duration at March 31, 2013. Our cash, cash equivalents and marketable securities at March 31, 2013 consisted of $2.37 billion held domestically, with the remaining balance of $1.56 billion held by foreign subsidiaries.

At March 31, 2013 we had 85 investments with a fair value of $527 million that were in an unrealized loss position for less than 12 months. Our gross unrealized losses of less than $1 million for these investments at March 31, 2013 were due to changes in market rates. We have determined that the gross unrealized losses on these investments at March 31, 2013 are temporary in nature. We evaluate securities for other-than-temporary impairment on a quarterly basis. Impairment is evaluated considering numerous factors, and their relative significance varies depending on the situation. Factors considered include the length of time and extent to which fair value has been less than the cost basis, the financial condition and near-term prospects of the issuer, and our intent and ability to hold the investment in order to allow for an anticipated recovery in fair value.

Instruments Not Recorded at Fair Value on a Recurring Basis. We measure the fair value of our long-term debt carried at amortized cost quarterly for disclosure purposes. The estimated fair value of long-term debt is determined by Level 2 inputs and is based primarily on quoted market prices for the same or similar issues. Based on the market prices, the fair value of our long-term debt was $1.74 billion and $1.75 billion as of March 31, 2013 and December 31, 2012, respectively. The recorded values of all our accounts receivable and accounts payable approximate their current fair values because of their nature and respective relatively short maturity dates or durations.

Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis. We measure the fair value of our cost method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in a business acquisition, and goodwill and other long lived assets when they are held for sale or determined to be impaired. See Note 9 for discussion on fair value measurements of certain assets and liabilities recorded at fair value on a non-recurring basis.

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4. Income Taxes

We recorded a tax provision of $2 million and a tax benefit of $45 million for the three months ended March 31, 2013 and March 31, 2012, respectively. Our effective tax rates were 1.0% and (104.7)% for the three months ended March 31, 2013 and March 31, 2012, respectively. The differences between our effective tax rates and the 35% federal statutory rate, primarily relate to foreign earnings taxed at substantially lower rates than the federal statutory rate due principally to our tax holiday in Singapore, and domestic tax losses recorded without tax benefits. In addition, we recorded tax benefits of $46 million for the three months ended March 31, 2012, resulting from reductions in our U.S. valuation allowance on certain deferred tax assets due to recording net deferred tax liabilities for identifiable intangible assets under purchase accounting.

As a result of our cumulative tax losses in the U.S. and certain foreign jurisdictions, and the full utilization of our loss carryback opportunities, we have concluded that a full valuation allowance should be recorded in such jurisdictions. In certain other foreign jurisdictions where we do not have cumulative losses, we had net deferred tax liabilities of $26 million and $29 million at March 31, 2013 and December 31, 2012, respectively.

We operate under tax holidays in Singapore, which are effective through March 2014. The tax holidays are conditional upon our meeting certain employment and investment thresholds. We are in discussions with the Singapore Economic Development Board with respect to tax incentives for periods after March 31, 2014.

5. Debt and Credit Facility

Senior Notes

The following table presents details of our senior notes, or Notes:

	March 31, 2013
	(In millions)
1.500% fixed-rate notes, due 2013	$	300
2.375% fixed-rate notes, due 2015	400
2.700% fixed-rate notes, due 2018	500
2.500% fixed-rate notes, due 2022	500
	$	1,700
Unaccreted discount	(6		)
Less current portion of long-term debt	(300		)
	$	1,394

In connection with the Notes issued in August 2012 and due in 2022, or the 2022 Notes, we entered into a registration rights agreement pursuant to which we agreed to use our reasonable commercial efforts to file with the SEC an exchange offer registration statement to issue registered notes with substantially identical terms as the 2022 Notes in exchange for any outstanding 2022 Notes, or, under certain circumstances, a shelf registration statement to register the 2022 Notes. In the three months ended March 31, 2013 we filed an exchange offer registration statement to issue registered notes with substantially identical terms as the original 2022 Notes. The registration statement was declared effective by the SEC and we commenced our offering on April 10, 2013. The offer will expire on May 8, 2013, or on such subsequent date or time to which we may extend the offer. If we are unable to timely complete our registration obligation, we will be subject to interest penalties.

The Notes contain a number of customary representations, warranties and restrictive covenants, including, but not limited to, restrictions on our ability to grant liens on assets; enter into sale and lease-back transactions; or merge, consolidate or sell assets. Failure to comply with these covenants, or any other event of default, could result in acceleration of the principal amount and accrued but unpaid interest on the Notes.

Relative to our overall indebtedness, the Notes rank in right of payment (i) equal with all of our other existing and future senior unsecured indebtedness (ii) senior to all of our existing and future subordinated indebtedness, and (iii) effectively subordinated to all of our subsidiaries' existing and future indebtedness and other obligations (including secured and unsecured obligations) and subordinated to our existing and future secured indebtedness and other obligations, to the extent of the assets securing such indebtedness and other obligations.

11

Credit Facility

In November 2010 we entered into a credit facility with certain institutional lenders that provides for unsecured revolving facility loans, swing line loans and letters of credit in an aggregate amount of up to $500 million. We amended this credit facility in October 2011 primarily to extend the maturity date by two years to November 19, 2016, at which time all outstanding revolving facility loans (if any) and accrued and unpaid interest must be repaid. The amendment to the credit facility also decreased the interest rate margins applicable to loans made under the credit facility and the commitment fee paid on the amount of the unused commitments. We have not drawn on our credit facility to date.

The credit facility contains customary representations, warranties and covenants. Financial covenants require us to maintain a consolidated leverage ratio of no more than 3.25 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00.

6. Shareholders’ Equity

Quarterly Dividend

In January 2013 our Board of Directors adopted an amendment to the existing dividend policy pursuant to which we increased the quarterly cash dividend by 10.0% to $0.11 per share ($0.44 per share on an annual basis) payable to holders of our common stock. In the three months ended March 31, 2013 and 2012 we paid $63 million and $55 million, respectively, in dividends to holders of our Class A and Class B common stock. These dividends were paid from U.S. domestic sources other than our retained earnings and are accounted for as reductions of shareholders’ equity.

Share Repurchase Program

In February 2010 we announced that our Board of Directors had authorized an evergreen share repurchase program intended to offset dilution of incremental grants of stock awards associated with our stock incentive plans. The maximum number of shares of our Class A common stock that may be repurchased in any one year under this program (including under an accelerated share repurchase agreement or other arrangement) is equal to the total number of shares issued pursuant to our equity awards in the previous year and the current year. This program does not have an expiration date and may be suspended at any time at the discretion of the Board of Directors. It may also be complemented with an additional share repurchase program in the future. Under the evergreen program we repurchased 3.2 million shares of our Class A common stock at a weighted average price of $33.42 in the three months ended March 31, 2013.

Repurchases under our share repurchase programs were and are intended to be made in open market or privately negotiated transactions in compliance with Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended, or the Exchange Act.

7. Employee Benefit Plans

Combined Incentive Plan Activity

Restricted stock unit activity is set forth below:

	Restricted Stock Units Outstanding
	Number of Shares		Weighted Average Grant-Date Fair Value per Share
	(In millions, except per share data)
Balance at December 31, 2012	25		$	35.55
Restricted stock units granted	12		33.81
Restricted stock units cancelled	—		35.05
Restricted stock units vested	(4	)	33.06
Balance at March 31, 2013	33		$	35.19

12

Stock option activity is set forth below:

	Options Outstanding
	Number of Shares		Weighted Average Exercise Price per Share		Weighted Average Grant-Date Fair Value per Share
	(In millions, except per share data)
Balance at December 31, 2012	58		$	28.11	$	14.95
Options cancelled	—		40.47		12.64
Options exercised	(4	)	22.15		23.46
Balance at March 31, 2013	54		$	28.42	$	14.46

The following table presents details of unearned stock-based compensation currently estimated to be expensed in the remainder of 2013 through 2017 related to unvested share-based payment awards:

	2013		2014		2015		2016		2017		Total
	(In millions)
Unearned stock-based compensation	$	384	$	373	$	233	$	119	$	15	$	1,124

If there are any modifications or cancellations of the underlying unvested awards, we may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that we grant additional equity awards or assume unvested equity awards in connection with acquisitions.

8. Commitments and Contingencies

Litigation

We and certain of our subsidiaries are currently parties to various legal proceedings, including those noted in this section. Unless otherwise noted below, during the periods presented we have not: recorded any accrual for loss contingencies associated with such legal proceedings; determined that an unfavorable outcome is probable or reasonably possible; or determined that the amount or range of any possible loss is reasonably estimable. We are engaged in numerous other legal actions not described below arising in the ordinary course of our business and, while there can be no assurance, we believe that the ultimate outcome of these actions will not have a material adverse effect on our operating results, liquidity or financial position.

From time to time we may conclude it is in the best interests of our shareholders, employees, and customers to settle one or more litigation matters, and any such settlement could include substantial payments; however, other than as noted below, we have not reached this conclusion with respect to any particular matter at this time. There are a variety of factors that influence our decisions to settle and the amount we may choose to pay, including the strength of our case, developments in the litigation, the behavior of other interested parties, the demand on management time and the possible distraction of our employees associated with the case and/or the possibility that we may be subject to an injunction or other equitable remedy. It is difficult to predict whether a settlement is possible, the amount of an appropriate settlement or when is the opportune time to settle a matter in light of the numerous factors that go into the settlement decision.

Intellectual Property Proceedings

In September 2009 we filed a complaint in the United States District Court for the Central District of California against Emulex Corporation, or Emulex, alleging infringement of ten patents generally relating to networking technologies. In subsequent filings, we added two additional patents and withdrew six patents, bringing the total to six asserted patents: U.S. Patents Nos. 7,058,150; 7,471,691; 7,450,500; 6,424,194; 7,486,124, and 7,724,057 (referred to as the Asserted Patents). In its answers, Emulex denied liability and asserted counterclaims seeking a declaratory judgment that the Asserted Patents are invalid and not infringed. A trial occurred in September and October 2011, and the Court heard post-trial motions in December 2011. The Court found that the Asserted Patents are not invalid. The Court further found Emulex infringed the ‘150 and ‘691 patents. In March 2012, the Court granted Broadcom’s motion for an injunction on the ‘150 and ‘691 patents and in April 2012, the Court entered an injunction against Emulex. The injunction contained a sunset period, which expired on April 11, 2013. Emulex recently filed a motion to extend the sunset period, which the Court denied. Emulex filed an appeal of the Court’s rulings on the ‘150 and ‘691 patents to the Federal Circuit. On the remaining Asserted Patents, the jury found the ‘500 patent

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was not infringed and failed to reach a verdict on infringement for the ‘194, ‘124, and ‘057 patents. The Court has scheduled a new trial regarding the ‘194, ‘124, and ‘057 patents for November 2013.

On July 3, 2012, Broadcom and Emulex entered into a partial settlement and license agreement for the Asserted Patents. Under the terms of the agreement, the parties dismissed their respective claims on the ‘691 and ‘500 patents, Emulex received a license and release related to the Asserted Patents for certain products for certain fields of use and Emulex was required to make a payment of certain amounts to Broadcom. The litigation proceedings for the ‘150, ‘194, ‘124, and ‘057 patents will continue relating to Emulex’s unlicensed activity.

In November 2009 we filed a complaint in the United States District Court for the Eastern District of Texas

against the Commonwealth Scientific and Industrial Research Organisation, or CSIRO, seeking a declaratory

judgment that a certain U.S. patent number is invalid, unenforceable and not infringed. CSIRO answered the

complaint and counterclaimed for infringement against Broadcom wireless LAN products and sought damages,

attorney’s fees, and an injunction. Following a court ordered mediation session in March 2012, Broadcom and

CSIRO entered into a settlement agreement resolving the litigation and the Court dismissed the parties’ claims with

prejudice. The terms of the settlement agreement included a full release from liability for all asserted claims, the grant

of a perpetual license under the asserted patent and all related patents to Broadcom, and the payment of certain

amounts by Broadcom.

In August 2010, we filed a motion to intervene (i.e., to be added as a party) in U.S. Ethernet Innovations, LLC v. Acer, Inc., Case No. 10-cv-03724-JW (N.D. Cal.). In this case, U.S. Ethernet Innovations, LLC, or USEI, filed a patent infringement complaint alleging that numerous companies, including certain of our customers, infringe patents relating generally to Ethernet technology. USEI seeks monetary damages, attorney’s fees, and an injunction. Defendants have filed answers denying the allegations in USEI’s complaint and asserting counterclaims for declaratory judgment that USEI’s patents are invalid, unenforceable, and not infringed. We contend that we have a license related to USEI’s patents and are seeking to assert this license as a defense. In December 2010, the Court granted our motion to intervene. Trial has been set for January 2015.

We and our subsidiaries are also involved in other intellectual property proceedings, claims and litigation. We will disclose the nature of any such matter if we believe it to be material. Particularly in the early stages of such proceedings, an assessment of materiality may be complicated by limited information, including, without limitation, limited information about the patents-in-suit and Broadcom products against which the patents are being asserted. Accordingly, our assessment of materiality may change in the future based upon availability of discovery and further developments in the proceedings at issue. Some of these intellectual property proceedings may involve, for example, “non-practicing entities” asserting claims addressing certain of our products. The resolution of intellectual property litigation can include, among other things, payment of damages, royalties, or other amounts, which could adversely, impact our product gross margins in future periods, or could prevent us from manufacturing or selling some of our products or limit or restrict the type of work that employees may perform for us. In addition, from time to time we are approached by holders of intellectual property, including non-practicing entities, to engage in discussions about our obtaining licenses to their intellectual property. We will disclose the nature of any such discussion if we determine that (i) it is probable an intellectual property holder will assert a claim of infringement, (ii) there is a reasonable possibility the outcome (assuming assertion) will be unfavorable, and (iii) the resulting liability would be material to our financial condition.

Other Proceedings

In April 2008 we delivered a Notice of Arbitration and Arbitration Claim to our former independent registered public accounting firm Ernst & Young LLP, or E&Y, and certain related parties. The arbitration relates to the issues that led to the restatement of our financial statements for the periods from 1998 through March 31, 2006 as disclosed in an amended Annual Report on Form 10-K/A for the year ended December 31, 2005 and an amended Quarterly Report on Form 10-Q/A for the three months ended March 31, 2006, each filed with the SEC January 23, 2007. In May 2008 E&Y delivered a Notice of Defense and Counterclaim. The arbitration hearing occurred in January 2013 and we are awaiting a decision from the panel.

In February 2012 we were notified by the SEC’s Division of Enforcement - Los Angeles Regional office that it is conducting a formal investigation of our accounting practices related to litigation reserves. The SEC has requested documents and information for the time period commencing June 1, 2010 to the present. We believe that the SEC’s investigation was prompted by allegations of a former employee relating to our processes and decisions regarding litigation reserves in the first quarter of 2011 in connection with asserted and unasserted intellectual property claims. Following our receipt of these allegations in April 2011, we, with oversight from the Audit Committee of the Board of Directors, conducted an internal review of these allegations with the assistance of independent outside counsel and did not identify any improprieties. This investigation was completed during the three months ended June 30, 2011. In addition, based on the internal review, the results of which

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were discussed with the our independent registered public accounting firm, we determined that no adjustments to our fiscal 2010 and March 31, 2011 consolidated financial statements were necessary relating to the subject matter of the review. We are cooperating with the SEC’s investigation.

In July 2012, a former employee filed a lawsuit against us alleging wrongful termination in violation of the Dodd-Frank Wall Street Reform and Consumer Protection Act and fundamental public policy under state law. The former employee alleges that he was terminated in June 2011 because he raised concerns that Broadcom did not appropriately accrue for and report certain loss contingencies in the three months ended March 31, 2011. We believe the lawsuit is without merit. On December 7, 2012, we filed a motion to dismiss the case. The court granted our motion and gave the plaintiff leave to amend his complaint. Plaintiff filed his First Amended Complaint on February 20, 2013. We have filed a motion to dismiss the First Amended Complaint. The hearing on that motion is scheduled for May 16, 2013.

General

We and our subsidiaries are also involved in other legal proceedings, claims and litigation arising in the ordinary course of business. We will disclose the nature of any such matter if we believe it to be material.

The pending proceedings described above involve complex questions of fact and law and may require the expenditure of significant funds and the diversion of other resources to prosecute and defend. The results of legal proceedings are inherently uncertain, and material adverse outcomes are possible. From time to time we may enter into confidential discussions regarding the potential settlement of pending intellectual property or other litigation or other proceedings; however, there can be no assurance that any such discussions will occur or will result in a settlement. In the course of such settlement discussions, if we conclude that a settlement loss is probable and the settlement amount is estimable we may record settlement costs, notwithstanding not having reached a final settlement agreement. The settlement of any pending litigation or other proceedings could require us to incur substantial settlement payments and costs. Furthermore, the settlement of any intellectual property proceeding may require us to grant a license to certain of our intellectual property rights to the other party under a cross-license agreement. If any of those events were to occur, our business, financial condition and results of operations could be materially and adversely affected.

Settlement Costs and Other Related Items

We did not record any settlement costs in the three months ended March 31, 2013. We recorded settlement costs of $86 million in the three months ended March 31, 2012 related to the settlement of patent infringement claims.  Upon the occurrence of certain events, we may be required to record additional settlement costs of up to $20 million related to a patent infringement case that settled in 2011.

9. Goodwill and Other Purchased Intangible Assets

Goodwill

The following table summarizes the activity related to the carrying value of our goodwill:

	Reportable Segments
	Broadband Communications		Mobile and Wireless			Infrastructure and Networking			Foreign Currency			Consolidated
	(In millions)
Goodwill	$	770	$	1,013		$	3,778		$	(6	)	$	5,555
Accumulated impairment losses	—		(543		)	(1,286		)	—			(1,829		)
Goodwill at December 31, 2012	$	770	$	470		$	2,492		$	(6	)	$	3,726
Effects of foreign currency translation	—		—			—			3			3
Goodwill at March 31, 2013	$	770	$	470		$	2,492		$	(3	)	$	3,729

As discussed in our 2012 Annual Report, based on our annual asset impairment testing and the increased balance of goodwill due to our recent acquisitions, including our acquisition of NetLogic Microsystems, Inc., or NetLogic, we determined there was a risk of our Infrastructure and Networking reporting unit failing the first step of the goodwill impairment test in future periods. The level of excess fair value over carrying value for this reporting unit was approximately 19% as of October 1, 2012. There have been no significant additional indicators of impairment that would require us to update our 2012 annual impairment testing in the three months ended March 31, 2013.

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Purchased Intangible Assets

The following table presents details of our purchased intangible assets:

	March 31, 2013								December 31, 2012
	Gross		Accumulated Amortization			Net			Gross		Accumulated Amortization			Net
	(In millions)
Developed technology	$	1,837	$	(483	)	$	1,354		$	1,760	$	(441	)	$	1,319
In-process research and development	226		—			226			315		—			315
Customer relationships	385		(238		)	147			385		(224		)	161
Other	36		(25		)	11			36		(25		)	11
	$	2,484	$	(746	)	$	1,738		$	2,496	$	(690	)	$	1,806
Effects of foreign currency translation						(16		)						(20		)
						$	1,722							$	1,786

In the three months ended March 31, 2013 we reclassified $80 million of IPR&D costs related to our acquisition of NetLogic to developed technology and such costs will now be amortized to cost of product revenue.

In March 2013 we recorded impairment charges, primarily for IPR&D of $10 million, related to our acquisition of Provigent, Inc. included in our Infrastructure and Networking reportable segment. In March 2012 we recorded impairment charges for developed technology of $28 million, primarily related to our acquisitions of Dune Networks, Inc. and Percello Ltd. included in our Infrastructure and Networking, and Broadband Communications reportable segments, respectively. The primary factor contributing to these impairment charges was the reduction in the revenue outlook for certain products and the resulting decrease to the estimated cash flows identified with the impaired assets.

In determining the amount of the impairment charges we calculated fair values as of the impairment date for acquired intangible assets. The fair value was determined using the multiple period excess earnings method. The fair values were determined using significant unobservable inputs categorized as Level 3 inputs. The key unobservable inputs utilized in the model include discount rates ranging from 14% to 25%, a market participant tax rate of 15%, and a probability adjusted level of future cash flows based on current product and market data.

The following table presents details of the amortization of purchased intangible assets included in the cost of product revenue and other operating expense categories:

	Three Months Ended
	March 31,
	2013		2012
	(In millions)
Cost of product revenue	$	43	$	37
Other operating expenses	15		17
	$	58	$	54

The following table presents details of the amortization of existing purchased intangible assets (including IPR&D), which is currently estimated to be expensed in the remainder of 2013 and thereafter:

	Purchased Intangible Asset Amortization by Year
	2013		2014		2015		2016		2017		Thereafter		Total
	(In millions)
Cost of product revenue	$	132	$	218	$	216	$	199	$	186	$	615	$	1,566
Other operating expenses	43		64		32		9		3		5		156
	$	175	$	282	$	248	$	208	$	189	$	620	$	1,722

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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 and Wireless (Hand) and Infrastructure and Networking (Infrastructure). Our Chief Executive Officer, who is our chief operating decision maker, or CODM, reviews financial information at the reportable segment level.

Our net revenue is generated principally from sales of integrated circuit products, the income we receive from the Qualcomm Agreement and other licensing revenue. While we derive some revenue from other sources, that revenue is not material as it represents approximately 1% of our total net revenue. Such revenue is classified under product revenue for reporting purposes. We group our net revenue consistent with our three target markets which comprise our reportable segments, as discussed above.

With respect to the sales of integrated circuit products, we have approximately 600 products that are grouped into approximately 60 product lines. We have concluded that these products constitute a group of similar products within each reportable segment in each of the following respects:

• the integrated circuits marketed by each of our reportable segments are sold to one type of customer: manufacturers of wired and wireless communications equipment, which incorporate our integrated circuits into their electronic products;

• the integrated circuits sold by each of our reportable segments use the same standard CMOS manufacturing processes; and

• all of our integrated circuits are sold through a centralized sales force and common wholesale distributors.

We also report an “All Other” category that is comprised of (i) income from the Qualcomm Agreement and (ii) other licensing revenue, 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, amortization of acquired inventory valuation step-up, impairment of goodwill and other long-lived assets, net settlement costs (gains), net restructuring costs, charitable contributions, non-recurring legal fees, change in contingent earnout liability, 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. 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 Communications		Mobile and Wireless		Infrastructure and Networking		All Other			Consolidated
	(In millions)
Three Months Ended March 31, 2013
Net revenue	$	537	$	996	$	429	$	43		$	2,005
Operating income (loss)	124		123		98		(147		)	198
Three Months Ended March 31, 2012
Net revenue	$	494	$	875	$	406	$	52		$	1,827
Operating income (loss)	104		124		107		(285		)	50

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Included in the “All Other” category:

	Three Months Ended
	March 31,
	2013			2012
	(In millions)
Net revenue	$	43		$	52
Stock-based compensation	$	140		$	150
Amortization of purchased intangible assets	58			54
Amortization of acquired inventory valuation step-up	1			22
Impairments of long-lived assets	10			28
Settlement costs	—			86
Restructuring costs, net	—			3
Employer payroll tax on certain stock option exercises	2			2
Miscellaneous corporate allocation variances	(21		)	(8		)
Total other operating costs and expenses	$	190		$	337
Total operating loss for the “All Other” category	$	(147	)	$	(285	)

Significant Customer and Geographical Information

We derive a substantial portion of our revenue from sales to a relatively small number of customers. Sales to our five largest customers, including their manufacturing subcontractors represented 51.4% and 49.2% of our total net revenue in the three months ended March 31, 2013 and 2012, respectively. Sales to two significant customers, those representing 10% or more of total net revenue, represented 36.8% and 31.3% of our total net revenue in the three months ended March 31, 2013 and 2012, respectively.

The geographical distribution of our shipments, as a percentage of product revenue was as follows:

	Three Months Ended
	March 31,
	2013		2012
China (exclusive of Hong Kong)	21.8	%	30.0	%
Hong Kong	25.2		25.9
Singapore, Taiwan, Thailand and Japan	39.7		31.5
United States	3.0		3.6
Europe	1.7		1.2
Other	8.6		7.8
	100.0	%	100.0	%

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement

The information contained in this Quarterly Report on Form 10-Q is intended to update the information contained in our Annual Report on Form 10-K for the year ended December 31, 2012, referred to as our 2012 Annual Report, and presumes that readers have access to, and will have read, the “Management's Discussion and Analysis of Financial Condition and Results of Operations” and other information contained in such Form 10-K. The information in this Form 10-Q is also not a complete description of our business or the risks associated with an investment in our common stock. You should read the following discussion and analysis in conjunction with our Unaudited Condensed Consolidated Financial Statements and the related Notes thereto contained in Part I, Item 1 of this Report and the various other disclosures made by us in this Report and in our other reports filed with the Securities and Exchange Commission, or SEC, including our 2012 Annual Report and subsequent reports on Forms 10-Q and 8-K, which discuss our business in greater detail.

The section entitled “Risk Factors” contained in Part II, Item 1A of this Report, and similar discussions in our other SEC filings, describe some of the important risk factors that may affect our business, financial condition, results of operations and/or liquidity. You should carefully consider those risks, in addition to the other information in this Report and in our other filings with the SEC, before deciding to purchase, hold or sell our common stock.

All statements included or incorporated by reference in this Quarterly Report on Form 10-Q, other than statements or characterizations of historical fact, are forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements include, but are not limited to, statements concerning projected total net revenue, costs and expenses and product and total gross margin; our accounting estimates, assumptions and judgments; the demand for our products; our dependence on a few key customers and/or design wins for a substantial portion of our revenue; our commitment to research and development efforts; estimates related to the amount and/or timing of the expensing of unearned stock-based compensation expense and stock-based compensation as a percentage of revenue; manufacturing, assembly and test capacity; the effect that economic conditions, seasonality and volume fluctuations in the demand for our customers’ consumer-oriented products will have on our quarterly operating results; our ability to adjust operations in response to changes in demand for existing products and services or the demand for new products requested by our customers; the competitive nature of and anticipated growth in our markets; our ability to migrate to smaller process geometries; our success in pending intellectual property litigation matters; our potential needs for additional capital; inventory and accounts receivable levels; our ability to obtain future tax holidays in Singapore; our ability to permanently reinvest our foreign earnings; the effect of potential changes in U.S. or foreign tax laws and regulations or the interpretation thereof; the level of accrued rebates; our ability to consummate acquisitions and integrate their operations successfully; and income we expect to record in connection with our 2009 agreement with Qualcomm Incorporated or similar arrangements in the future. These forward-looking statements are based on our current expectations, estimates and projections about our industry and business, management’s beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as “anticipates,” “expects,” “intends,” “plans,” “predicts,” “believes,” “seeks,” “estimates,” “may,” “will,” “should,” “would,” “could,” “potential,” “continue,” “ongoing,” similar expressions, and variations or negatives of these words. These statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors, some of which are listed under the section entitled “Risk Factors” in Part II, Item 1A of this Report. These forward-looking statements speak only as of the date of this Report. We undertake no obligation to revise or update publicly any forward-looking statement to reflect future events or circumstances.

Overview

Broadcom Corporation (including our subsidiaries, referred to collectively in this Report as “Broadcom,” “we,” “our” and “us”) is a global leader and innovator in semiconductor solutions for wired and wireless communications. Broadcom products seamlessly deliver voice, video, data and multimedia connectivity in the home, office and mobile environments. We provide the industry’s broadest portfolio of state-of-the-art system-on-a-chip, or SoC, and embedded software solutions.

We sell our products to leading wired and wireless communications manufacturers in each of our reportable segments: Broadband Communications (Home), Mobile and Wireless (Hand), and Infrastructure and Networking (Infrastructure). Because we leverage our technologies across different markets, certain of our integrated circuits may be incorporated into products used in multiple markets. We utilize independent foundries and third-party subcontractors to manufacture, assemble and test all of our semiconductor products.

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Our diverse product portfolio includes:

• Broadband Communications (Solutions for the Home) — Complete solutions for cable, xDSL, fiber, satellite and IP broadband networks to enable the connected home, including set-top-boxes and media servers, residential modems and gateways, small and residential cells and wired home networking solutions.

• Mobile and Wireless (Solutions for the Hand) — Low-power, high-performance and highly integrated solutions powering the mobile and wireless ecosystem, including Wi-Fi and Bluetooth, cellular SoCs, personal navigation and global positioning, near field communications (NFC), Voice over IP (VoIP), and mobile power management solutions.

• Infrastructure and Networking (Solutions for Infrastructure) — Highly integrated solutions for carriers, service providers, enterprises, small-to-medium businesses and data centers for network infrastructure needs, including Ethernet switches, physical layer devices (PHYs), multicore embedded processors, knowledge-based processors (KBP), digital front ends for wireless infrastructure, switch fabric solutions, high-speed Ethernet controllers and microwave backhaul devices.

Our product revenue consists principally of sales of semiconductor devices and, to a lesser extent, software licenses and royalties, development, support and maintenance agreements, data services and cancellation fees. The majority of our product sales occur through the efforts of our direct sales force. The remaining balance of our product sales occurs through distributors. Our licensing revenue and income is generated from the licensing of our intellectual property, of which the vast majority to date has been derived from our April 2009 agreement with Qualcomm Incorporated, or the Qualcomm Agreement. The income from the Qualcomm Agreement is non-recurring and will terminate in April 2013. There can be no assurances that we will be able to enter into similar arrangements of this magnitude in the future.

A detailed discussion of our business may be found in our 2012 Annual Report under Part I, Item 1, “Business.”

Operating Results for the Three Months Ended March 31, 2013

In the three months ended March 31, 2013 our net income was $191 million as compared to net income of $88 million in the three months ended March 31, 2012. The increase in profitability was primarily related to a 9.7% increase in total net revenue, higher gross margins due to the reduction of inventory valuation step-up expensed as result of the previous sell through of inventory assumed in our acquisition of NetLogic Microsystems, Inc., or NetLogic, in February 2012 and a decrease in settlement costs of $86 million; offset by the full quarter impact of research and development expenses associated with the NetLogic acquisition and organic hiring.

Other highlights during the three months ended March 31, 2013 include the following:

• Our cash and cash equivalents and marketable securities were $3.93 billion at March 31, 2013, compared with $3.72 billion at December 31, 2012. We generated cash flow from operations of $388 million during the three months ended March 31, 2013 as compared to $368 million in the three months ended March 31, 2012.

• In January 2013 our Board of Directors adopted an amendment to our existing dividend policy pursuant to which we increased our quarterly cash dividend by 10.0% to $0.11 per share ($0.44 per share on an annual basis) payable to holders of our common stock.

• We repurchased 3.2 million shares of our Class A common stock at a weighted average price of $33.42 in the three months ended March 31, 2013.

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Business Enterprise Segments.

The following table presents details of our reportable segments and the “All Other” category:

	Reportable Segments
	Broadband Communications		Mobile and Wireless		Infrastructure and Networking		All Other			Consolidated
	(In millions)
Three Months Ended March 31, 2013
Net revenue	$	537	$	996	$	429	$	43		$	2,005
Operating income (loss)	124		123		98		(147		)	198
Three Months Ended December 31, 2012
Net revenue	$	562	$	1,012	$	462	$	44		$	2,080
Operating income (loss)	139		159		120		(155		)	263
Three Months Ended March 31, 2012
Net revenue	$	494	$	875	$	406	$	52		$	1,827
Operating income (loss)	104		124		107		(285		)	50

For additional information about our business enterprise segments and “All Other” category (including revenue and expense items reported under the "All Other" category), see further discussion in Note 10 of Notes to Unaudited Condensed Consolidated Financial Statements.

Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with U.S. generally accepted accounting principles, or GAAP, requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of net revenue and expenses in the reporting period. We regularly evaluate our

estimates and assumptions related to revenue recognition, rebates, allowances for doubtful accounts, sales returns and allowances, warranty reserves, inventory reserves, stock-based compensation expense, goodwill and purchased intangible asset valuations, strategic investments, deferred income tax asset valuation allowances, uncertain tax positions, tax contingencies, self-insurance, restructuring costs, litigation and other loss contingencies. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. The actual results experienced by us may differ materially and adversely from our estimates. To the extent there are material differences between our estimates and the actual results, our future results of operations will be affected. For a description of our critical accounting policies and estimates, please refer to the “Critical Accounting Policies and Estimates” section in Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations" of our 2012 Annual Report. There have been no material changes in any of our critical accounting policies and estimates during the three months ended March 31, 2013.

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Results of Operations

The following table sets forth certain Unaudited Condensed Consolidated Statements of Income data expressed as a percentage of net revenue for the periods indicated:

	Three Months Ended
	March 31,
	2013		2012
Net revenue:
Product revenue	97.5	%	96.9	%
Income from Qualcomm Agreement	2.1		2.8
Licensing revenue	0.4		0.3
Total net revenue	100.0		100.0
Costs and expenses:
Cost of product revenue	49.3		50.2
Research and development	30.7		29.9
Selling, general and administrative	8.9		9.8
Amortization of purchased intangible assets	0.7		0.9
Impairments of long-lived assets	0.5		1.5
Restructuring costs, net	—		0.3
Settlement costs	—		4.7
Total operating costs and expenses	90.1		97.3
Income from operations	9.9		2.7
Interest expense, net	(0.4	)	(0.3	)
Other income (expense), net	0.1		(0.1	)
Income before income taxes	9.6		2.3
Provision for (benefit of) income taxes	0.1		(2.5	)
Net income	9.5	%	4.8	%

The following table presents supplementary financial data as a percentage of net revenue:

	Three Months Ended
	March 31,
	2013		2012
Net Revenue By Reportable Segment
Broadband Communications	26.8	%	27.0	%
Mobile and Wireless	49.7		48.0
Infrastructure and Networking	21.4		22.2
All other (1)	2.1		2.8
Gross Margin Data
Product gross margin	49.4	%	48.1	%
Total gross margin	50.7		49.8
Stock-Based Compensation Expense (included in each functional line item)
Cost of product revenue	0.3	%	0.5	%
Research and development	4.9		5.1
Selling, general and administrative	1.7		2.6

(1) Includes (i) income relating to the Qualcomm Agreement and (ii) other revenue from certain patent license agreements.

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Net Revenue By Reportable Segments

The following table presents net revenue from each of our reportable segments and such segments' respective contribution to net revenue:

	Three Months Ended						Quarter over Quarter					Year over Year
	March 31, 2013		December 31, 2012		March 31, 2012		$ Change			% Change		$ Change			% Change
	(In millions, except percentages)
Broadband Communications	$	537	$	562	$	494	$	(25	)	(4.4	)%	$	43		8.7	%
Mobile and Wireless	996		1,012		875		(16		)	(1.6	)	121			13.8
Infrastructure and Networking	429		462		406		(33		)	(7.1	)	23			5.7
All other (1)	43		44		52		(1		)	(2.3	)	(9		)	(17.3	)
Total net revenue	$	2,005	$	2,080	$	1,827	$	(75	)	(3.6	)	$	178		9.7

(1) Includes (i) income relating to the Qualcomm Agreement and (ii) other revenue from certain patent license agreements.

Broadband Communications. The increase in net revenue in the three months ended March 31, 2013 as compared to three months ended March 31, 2012 resulted primarily from an increase in sales of our set-top box, or STB, and broadband modem solutions of $58 million, partially offset by a reduction in sales of our digital television and Blu-ray Disc products of $15 million. The decrease in net revenue in the three months ended March 31, 2013 as compared to the three months ended December 31, 2012, resulted primarily from a decrease in sales of our STB and broadband modem products of $20 million. Broadband modem and STB growth from the three months ended March 31, 2012 was generally driven by an increase in the number of global subscribers for broadband access and pay-TV services, respectively, as well as the adoption of faster modems, new features and the roll-out of more highly integrated platforms by global service providers. In broadband access, the market is transitioning to higher speed DOCSIS, PON and DSL modems. These transitions generally demand more semiconductor content. The decrease in sales of our digital television and Blu-ray Disc products was the result of our decision to exit from those particular consumer electronic markets and reallocate resources to more attractive opportunities.

Mobile and Wireless. The increase in net revenue in the three months ended March 31, 2013 as compared to the three months ended March 31, 2012 resulted primarily from an increase in sales of our cellular SoCs and wireless connectivity products of $83 million and other wireless technology products of $61 million, partially offset by a decrease in sales of our multimedia co-processors of $23 million. The decrease in net revenue in the three months ended March 31, 2013 as compared to the three months ended December 31, 2012 resulted primarily from a decrease in sales of our other wireless technology products of $25 million, partially offset by an increase in sales of our cellular SoCs and wireless connectivity products of $9 million. Growth in our cellular SoCs and wireless connectivity businesses has been driven by increased demand for our 3G SoC solutions and demand for higher-end end-devices which require Wi-Fi and Bluetooth connectivity. Growth is also driven by the ramp of faster cellular modems, more powerful applications processors, new connectivity technologies, and richer connectivity features. For example, in connectivity, we are seeing the transition from single-band to dual-band WiFi and from 802.11n to 802.11ac. We are also ramping new connectivity technologies, including near field communication (NFC). The multimedia co-processor business has declined due to the end of life of certain customer products and the integration of multimedia co-processor into our 3G SoC solutions.

Infrastructure and Networking. The increase in net revenue for the three months ended March 31, 2013 as compared to the three months ended March 31, 2012 resulted primarily from an increase in sales of our communication processors of $41 million, partially offset by a decrease in sales of our Ethernet controller products of $11 million. The increase in sales of our communication processors resulted from our acquisition of NetLogic in February 2012. The decrease in Ethernet controller products was primarily due to softness in the PC market. The decrease in net revenue for the three months ended March 31, 2013 as compared to the three months ended December 31, 2012 resulted primarily from a decrease in sales of our Ethernet switches and PHYs of $20 million, as a result of softness in spending in the service provider and enterprise spaces. Growth in Ethernet switches and PHYs is generally driven by the on-going transition to packet-based networks to support the delivery of video and mobile data over the Internet, an increase in hosted services and cloud computing, and the ongoing growth in unified communications in the enterprise. For example, in the data center market, we have benefited from the ramp of 10G networking in top-of-rack implementations. We have also benefited from expanding the addressable market for our infrastructure and networking products. We recently announced new entries into the optical transport networking market, 100G coherent PHY.  

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Rebates. We recorded rebates to certain customers of $161 million, or 8.0% of net revenue, $215 million, or 10.3% of net revenue, and $147 million, or 8.0% of net revenue, in the three months ended March 31, 2013, December 31, 2012, and March 31, 2012, respectively. We reverse the accrual of unclaimed rebate amounts as specific rebate programs contractually end or when we believe unclaimed rebates are no longer subject to payment and will not be paid. We reversed accrued rebates of $6 million, $10 million and $3 million in the three months ended March 31, 2013, December 31, 2012 and March 31, 2012, respectively. We anticipate that accrued rebates will vary in future periods based upon the level of overall sales to customers that participate in our rebate programs.

Concentration of Net Revenue

We derive a substantial portion of our revenue from sales to a relatively small number of customers. Sales to our five largest customers represented 51.4% and 49.2% of our total net revenue in the three months ended March 31, 2013 and 2012, respectively. Sales to two significant customers, those representing 10% or more of total net revenue, represented 36.8% and 31.3% of our total net revenue in the three months ended March 31, 2013 and 2012, respectively. We expect that our largest customers will continue to account for a substantial portion of our total net revenue for the foreseeable future. Our largest customers and their respective contributions to our total net revenue have varied and will likely continue to vary from period to period.

From time to time, our key customers place large orders causing our quarterly net revenue to fluctuate significantly. We expect that these fluctuations will continue and that they may be exaggerated by the seasonal variations in consumer products and changes in the overall economic environment. For these and other reasons, our total net revenue and results of operations for the three months ended March 31, 2013 and prior periods may not necessarily be indicative of future net revenue and results of operations.

Total Net Revenue, Cost of Product Revenue, Product Gross Margin, and Total Gross Margin

The following table presents total net revenue, cost of product revenue, product gross margin and total gross margin:

	Three Months Ended									Quarter over Quarter					Year over Year
	March 31, 2013			December 31, 2012			March 31, 2012			$ Change			% Change		$ Change			% Change
	(In millions, except percentages)
Product revenue	$	1,954		$	2,028		$	1,770		$	(74	)	(3.6	)%	$	184		10.4	%
Income from Qualcomm Agreement	43			43			52			—			—		(9		)	(17.3	)
Licensing revenue	8			9			5			(1		)	(11.1	)	3			60.0
Total net revenue	$	2,005		$	2,080		$	1,827		$	(75	)	(3.6	)	$	178		9.7
Cost of product revenue	$	988		$	1,025		$	918		$	(37	)	(3.6	)	$	70		7.6
Product gross margin	49.4		%	49.5		%	48.1		%
Total gross margin	50.7		%	50.7		%	49.8		%

Cost of Product Revenue and Product Gross Margin. Cost of product revenue comprises the cost of our semiconductor devices, which consists of the cost of purchasing finished silicon wafers manufactured by independent foundries, costs associated with our purchase of assembly, test and quality assurance services and packaging materials for semiconductor products, as well as royalties and license fees paid to vendors and to non-practicing entities, or NPEs. Also included in cost of product revenue is the amortization of purchased technology and inventory valuation step-up, and manufacturing overhead, including costs of personnel and equipment associated with manufacturing support, product warranty costs, provisions for excess and obsolete inventories, and stock-based compensation expense for personnel engaged in manufacturing support. Product gross margin is product revenue less cost of product revenue divided by product revenue and does not include income from the Qualcomm Agreement or revenue from the licensing of intellectual property. Total gross margin is total net revenue less cost of product revenue divided by total net revenue.

Product gross margin increased to 49.4% in the three months ended March 31, 2013 as compared to 48.1% in the three months ended March 31, 2012 primarily due to a reduction of inventory valuation step-up of $21 million and the net revenue generated by our acquisition of NetLogic (which business has higher product gross margins), offset in part by increases in amortization of purchased intangibles and excess and obsolete inventory expense of $6 million and $12 million, respectively. The decrease in inventory step-up was primarily the result of the sell through of inventory assumed in our acquisition of

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NetLogic in prior quarters. The increase in the amortization of purchased intangibles was primarily the result of the full quarter impact of our acquisitions of NetLogic and BroadLight Inc. Product gross margin also includes $7 million and $3 million of licensing costs related to NPEs in the three months ended March 31, 2013 and 2012, respectively.

Product gross margin was nearly flat at 49.4% in the three months ended March 31, 2013 as compared to 49.5% in the three months ended December 31, 2012. Product gross margin also includes $7 million and $8 million of licensing costs related to NPEs in each of the three months ended March 31, 2013 and December 31, 2012, respectively.

Our product and total gross margin may also be impacted by additional stock-based compensation expense and changes therein, as discussed below, and the amortization of purchased intangible assets related to future acquisitions.

Research and Development Expense

Research and development expense consists primarily of salaries and related costs of employees engaged in research, design and development activities, including stock-based compensation expense. Development and design costs consist primarily of costs related to engineering design tools, mask and prototyping costs, testing and subcontracting costs. In addition, we incur costs related to facilities and equipment expense, among other items.

The following table presents details of research and development expense:

	Three Months Ended						Quarter over Quarter					Year over Year
	March 31, 2013		December 31, 2012		March 31, 2012		$ Change			% Change		$ Change		% Change
	(In millions, except percentages)
Salaries and benefits	$	348	$	326	$	304	$	22		6.7	%	$	44	14.5	%
Stock-based compensation	99		90		94		9			10.0		5		5.3
Development and design costs	93		96		79		(3		)	(3.1	)	14		17.7
Other	75		78		69		(3		)	(3.8	)	6		8.7
Research and development	$	615	$	590	$	546	$	25		4.2	%	$	69	12.6	%

The increase in salaries and benefits for the three months ended March 31, 2013 as compared to the three months ended March 31, 2012 was primarily attributable to an increase in headcount of approximately 1,000 personnel, bringing headcount to approximately 8,850 at March 31, 2013, which represents a 12.7% increase from March 31, 2012. See below for discussion of stock-based compensation. Development and design costs increased in the three months ended March 31, 2013 due to increases in tape-out costs related to moving to smaller geometries, as well as engineering design tool expenses. Development and design costs vary from period to period depending on the timing of development and tape-out of various products. The increase in the Other line item in the above table is primarily attributable to an increase in depreciation expenses.

The increase in salaries and benefits for the three months ended March 31, 2013 as compared to the three months ended December 31, 2012 was primarily attributable to fringe expense associated with our bonuses for 2012 paid in the three months ended March 31, 2013. See below for discussion of stock-based compensation. Development and design costs decreased in the three months ended March 31, 2013 due to decreases in engineering and prototyping costs. The decrease in the Other line item in the above table is primarily attributable to a decrease in facility expenses.

We remain committed to significant research and development efforts to extend our technology leadership in the wired and wireless communications markets in which we operate. We expect research and development costs to increase as a result of growth in, and the diversification of, the markets we serve, new product opportunities, the number of design wins that go into production, changes in our compensation policies, and any expansion into new markets and technologies, including acquisitions. Approximately 45% of our products are currently manufactured in 65 nanometers (with an increasing number of products being manufactured in 40 nanometers). We are designing most new products in 40 nanometers, 28 nanometers and 20 nanometers, and are beginning to evaluate FinFET technologies. We currently hold more than 8,050 U.S. and more than 3,200 foreign patents and more than 7,650 additional U.S. and foreign pending patent applications. We maintain an active program of filing for and acquiring additional U.S. and foreign patents in wired and wireless communications and other fields.

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Selling, General and Administrative Expense

Selling, general and administrative expense consists primarily of personnel-related expenses, including stock-based compensation expense, legal and other professional fees, facilities expenses and communications expenses.

The following table presents details of selling, general and administrative expense:

	Three Months Ended						Quarter over Quarter				Year over Year
	March 31, 2013		December 31, 2012		March 31, 2012		$ Change		% Change		$ Change			% Change
	(In millions, except percentages)
Salaries and benefits	$	88	$	87	$	80	$	1	1.1	%	$	8		10.0	%
Stock-based compensation	34		32		47		2		6.3		(13		)	(27.7	)
Legal and accounting fees	23		21		23		2		9.5		—			—
Other	34		32		29		2		6.3		5			17.2
Selling, general and administrative	$	179	$	172	$	179	$	7	4.1	%	$	—		—	%

The increase in salaries and benefits for the three months ended March 31, 2013 as compared to the three months ended March 31, 2012 was primarily attributable to the full quarter impact of our acquisition of NetLogic in 2012. Our headcount remained flat at approximately 1,950 personnel at March 31, 2013. See below for discussion of stock-based compensation. Legal fees remained flat year over year. Legal fees consist primarily of attorneys’ fees and expenses related to our outstanding intellectual property and prior years’ securities litigation, patent prosecution and filings and various other transactions. Legal fees fluctuate from period to period due to the nature, scope, timing and costs of the matters in litigation. See Note 8 of Notes to Unaudited Condensed Consolidated Financial Statements for further information. The increase in Other line item was primarily attributable to an increase in facilities expense.

Stock-Based Compensation Expense

The following table presents details of total stock-based compensation expense that is included in each functional line item in our unaudited condensed consolidated statements of income:

	Three Months Ended						Quarter over Quarter				Year over Year
	March 31, 2013		December 31, 2012		March 31, 2012		$ Change		% Change		$ Change			% Change
	(In millions, except percentages)
Cost of product revenue	$	7	$	6	$	9	$	1	16.7	%	$	(2	)	(22.2	)%
Research and development	99		90		94		9		10.0		5			5.3
Selling, general and administrative	34		32		47		2		6.3		(13		)	(27.7	)
	$	140	$	128	$	150	$	12	9.4	%	$	(10	)	(6.7	)%

The decrease in stock-based compensation for the three months ended March 31, 2013 as compared to the three months ended March 31, 2012 was primarily attributable to the accelerated vesting of certain equity awards of $17 million upon the termination of certain former NetLogic employees with change in control agreements. In the three months ended March 31, 2013, we also granted equity awards with a fair value of $413 million, primarily related to our regular annual equity compensation review program, which will be expensed over the next four years. The increase in stock-based compensation for the three months ended March 31, 2013 as compared to the three months ended December 31, 2012 was primarily attributable to the equity awards granted above.

The following table presents details of unearned stock-based compensation currently estimated to be expensed in the remainder of 2013 and through 2017 related to unvested share-based payment awards:

	2013		2014		2015		2016		2017		Total
	(In millions)
Unearned stock-based compensation	$	384	$	373	$	233	$	119	$	15	$	1,124

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If there are any modifications or cancellations of the underlying unvested awards, we may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that we grant additional equity awards to employees or assume unvested equity awards in connection with acquisitions.

It is our long-term objective that total stock-based compensation approximates 5% of total net revenue. See Note 7 of Notes to Unaudited Condensed Consolidated Financial Statements for a discussion of activity related to share-based awards.

Amortization of Purchased Intangible Assets

The following table presents details of the amortization of purchased intangible assets included in the cost of product revenue and other operating expense categories:

	Three Months Ended						Quarter over Quarter					Year over Year
	March 31, 2013		December 31, 2012		March 31, 2012		$ Change			% Change		$ Change			% Change
	(In millions, except percentages)
Cost of product revenue	$	43	$	50	$	37	$	(7	)	(14.0	)%	$	6		16.2	%
Other operating expenses	15		31		17		(16		)	(51.6	)	(2		)	(11.8	)
	$	58	$	81	$	54	$	(23	)	(28.4	)%	$	4		7.4	%

The decrease in amortization of purchased intangible assets for the three months ended March 31, 2013 as compared to the three months ended December 31, 2012 reflects the pattern in which the economic benefits of the intangible assets were consumed or otherwise used.

The following table presents details of the amortization of existing purchased intangible assets (including IPR&D), currently estimated to be expensed in the remainder of 2013 and thereafter:

	Purchased Intangible Asset Amortization by Year
	2013		2014		2015		2016		2017		Thereafter		Total
	(In millions)
Cost of product revenue	$	132	$	218	$	216	$	199	$	186	$	615	$	1,566
Other operating expenses	43		64		32		9		3		5		156
	$	175	$	282	$	248	$	208	$	189	$	620	$	1,722

Impairment of Goodwill and Other Long-Lived Assets

In March 2013 we recorded impairment charges, primarily for IPR&D of $10 million, related to our acquisition of Provigent, Inc. included in our Infrastructure and Networking reportable segment. In March 2012 we recorded impairment charges for developed technology of $28 million, primarily related to our acquisitions of Dune Networks, Inc. and Percello Ltd. included in our Infrastructure and Networking, and Broadband Communications reportable segments, respectively. The primary factor contributing to these impairment charges was the reduction in the revenue outlook for certain products and the resulting decrease to the estimated cash flows identified with the impaired assets.

As discussed in Note 10, "Impairment of Goodwill and Long-Lived Assets," in Part IV, Item 15 of our 2012 Annual Report, based on our annual asset impairment testing and the increased balance of goodwill due to our recent acquisitions, including NetLogic, we determined there was a risk of our Infrastructure and Networking reporting unit failing the first step of the goodwill impairment test in future periods. The level of excess fair value over carrying value for this reporting unit was approximately 19% as of October 1, 2012. There have been no significant additional indicators of impairment that would require us to update our 2012 annual impairment testing in the three months ended March 31, 2013.

Settlement Costs

We did not record any settlement costs in the three months ended March 31, 2013. We recorded settlement costs of $86 million in the three months ended March 31, 2012 primarily related to patent infringement claims. See Note 8 of Notes to the Unaudited Condensed Consolidated Financial Statements.

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Provision for (Benefit of) Income Taxes

We recorded a tax provision of $2 million and a tax benefit of $45 million for the three months ended March 31, 2013 and March 31, 2012, respectively. Our effective tax rates were 1.0% and (104.7)% for the three months ended March 31, 2013 and March 31, 2012, respectively. The differences between our effective tax rates and the 35% federal statutory rate, primarily relate to foreign earnings taxed at substantially lower rates than the federal statutory rate due principally to our tax holiday in Singapore, and domestic tax losses recorded without tax benefits. In addition, we recorded tax benefits of $46 million for the three months ended March 31, 2012, resulting from reductions in our U.S. valuation allowance on certain deferred tax assets due to recording net deferred tax liabilities for identifiable intangible assets under purchase accounting.

As a result of our cumulative tax losses in the U.S. and certain foreign jurisdictions, and the full utilization of our loss carryback opportunities, we have concluded that a full valuation allowance should be recorded in such jurisdictions. In certain other foreign jurisdictions where we do not have cumulative losses, we had net deferred tax liabilities of $26 million and $29 million at March 31, 2013 and December 31, 2012, respectively.

We operate under tax holidays in Singapore, which are effective through March 2014. The tax holidays are conditional upon our meeting certain employment and investment thresholds. We are in discussions with the Singapore Economic Development Board with respect to tax incentives for periods after March 31, 2014.

Liquidity and Capital Resources

Working Capital and Cash and Marketable Securities. The following table presents working capital, cash and cash equivalents, and marketable securities:

	March 31, 2013		December 31, 2012		$ Change
	(In millions)
Working capital	$	2,222	$	2,099	$	123
Cash and cash equivalents	$	1,742	$	1,617	125
Short-term marketable securities	727		757		(30		)
Long-term marketable securities	1,457		1,348		109
Total cash and cash equivalents and marketable securities	$	3,926	$	3,722	$	204

Cash and cash equivalents increased to $1.74 billion at March 31, 2013 from $1.62 billion at December 31, 2012 as a result of cash provided by operating activities, offset by our quarterly dividend payments, repurchases of shares of our Class A common stock and purchases of marketable securities and property and equipment.

See discussion of market risk that follows in Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Cash Provided and Used in the Three Months Ended March 31, 2013 and 2012

	Three Months Ended
	March 31,
	2013			2012
	(In millions)
Net cash provided by operating activities	$	388		$	368
Net cash used in investing activities	(121		)	(3,095		)
Net cash used in financing activities	(142		)	(94		)
Increase (decrease) in cash and cash equivalents	125			(2,821		)
Cash and cash equivalents at beginning of period	1,617			4,146
Cash and cash equivalents at end of period	$	1,742		$	1,325

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Operating Activities

In the three months ended March 31, 2013 our operating activities provided $388 million in cash. This was primarily the result of net income of $191 million, net non-cash operating expenses of $247 million, offset in part by changes in operating assets and liabilities of $50 million. In the three months ended March 31, 2012 our operating activities provided $368 million in cash. This was primarily the result of net income of $88 million, net non-cash operating expenses of $260 million and changes in operating assets and liabilities of $20 million.

Our days sales outstanding increased from 32 days at December 31, 2012 to 34 days at March 31, 2013 due to revenue linearity (meaning an increased percentage of sales occurred in the final month of the quarter). We typically bill customers on an open account basis subject to our standard net thirty day payment terms. If, in the longer term, our revenue increases, it is likely that our accounts receivable balance will also increase. Our accounts receivable could also increase if customers delay their payments or if we grant extended payment terms to customers, both of which are more likely to occur during challenging economic times when our customers may have difficulty gaining access to sufficient credit on a timely basis.

Our inventory days on hand increased from 47 days at December 31, 2012 to 48 days at March 31, 2013 primarily to meet the anticipated revenue levels in the three months ending June 30, 2013. In the future, our inventory levels will continue to be determined by the level of purchase orders we receive and the stage at which our products are in their respective product life cycles, our ability, and the ability of our customers, to manage inventory under hubbing arrangements, and competitive situations in the marketplace. Such considerations are balanced against the risk of obsolescence or potentially excess inventory levels.

Investing Activities

Investing activities used $121 million in cash in the three months ended March 31, 2013, which was primarily the result of $41 million of capital equipment purchases to support our research and development efforts and $80 million in net purchases of marketable securities. Investing activities used $3.10 billion in cash in the three months ended March 31, 2012, which was primarily the result of $3.39 billion in net cash paid for our acquisition of NetLogic and $74 million of capital equipment purchases to support our research and development efforts, offset in part by $372 million in net proceeds from sales and maturities of marketable securities.

Financing Activities

Our financing activities used $142 million in cash in the three months ended March 31, 2013, which was primarily the result of repurchases of our Class A common stock of $107 million, dividends of $63 million, and $40 million in minimum tax withholding paid on behalf of employees for shares issued pursuant to restricted stock units, offset in part by $68 million in proceeds received from issuances of common stock upon the exercise of stock options. Our financing activities used $94 million in cash in the three months ended March 31, 2012, which was primarily the result of a $53 million payment of contingent consideration assumed from our acquisition of NetLogic, dividends of $55 million, and $48 million in minimum tax withholding paid on behalf of employees for shares issued pursuant to restricted stock units, offset in part by $62 million in proceeds received from issuances of common stock upon the exercise of stock options.

The timing and number of stock option exercises and employee stock purchases and the amount of cash proceeds we receive from these equity awards are not within our control. As it is now our general practice to issue restricted stock units, or RSUs, instead of stock options we will likely not generate as much cash from the exercise of stock options as we have in the past. Unlike the exercise of stock options, the issuance of shares upon vesting of RSUs does not result in any cash proceeds to Broadcom and in fact requires the use of cash, as we currently allow employees to have a portion of the shares issued upon vesting of RSUS withheld to satisfy minimum statutory withholding taxes. This withholding procedure requires that we pay cash to the appropriate tax authorities on each participating employee's behalf.

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Short and Long-Term Financing Arrangements

At March 31, 2013, we had the following resources available to obtain short-term or long-term financings if we need additional liquidity:

Registration Statements

We have a Form S-4 acquisition shelf registration statement on file with the SEC. The registration statement on Form S-4 enables us to issue up to 30 million shares of our Class A common stock in one or more acquisition transactions. These transactions may include the acquisition of assets, businesses or securities by any form of business combination. To date no securities have been issued pursuant to the S-4 registration statement, which does not have an expiration date mandated by SEC rules.

Credit Facility

In November 2010 we entered into a credit facility with certain institutional lenders that provides for unsecured revolving facility loans, swing line loans and letters of credit in an aggregate amount of up to $500 million. We amended this credit facility in October 2011 primarily to extend the maturity date by two years to November 19, 2016, at which time all outstanding revolving facility loans (if any) and accrued and unpaid interest must be repaid. The amendment to the credit facility also decreased the interest rate margins applicable to loans made under the credit facility and the commitment fee paid on the amount of the unused commitments. We have not drawn on the credit facility since its inception.

The credit facility contains customary representations, warranties and covenants. Financial covenants require us to maintain a consolidated leverage ratio of no more than 3.25 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00. We were in compliance with all debt covenants as of March 31, 2013.

Senior Notes

The following table summarizes details of our senior unsecured notes, or Notes:

	March 31, 2013
	(In millions)
1.500% fixed-rate notes, due 2013	$	300
2.375% fixed-rate notes, due 2015	400
2.700% fixed-rate notes, due 2018	500
2.500% fixed-rate notes, due 2022	500
	$	1,700
Unaccreted discount	(6		)
Less current portion of long-term debt	(300		)
	$	1,394

In connection with the Notes issued in August 2012 and due in 2022, or the 2022 Notes, we entered into a registration rights agreement pursuant to which we agreed to use our reasonable commercial efforts to file with the SEC an exchange offer registration statement to issue registered notes with substantially identical terms as the 2022 Notes in exchange for any outstanding 2022 Notes, or, under certain circumstances, a shelf registration statement to register the 2022 Notes. In the three months ended March 31, 2013 we filed an exchange offer registration statement to issue registered notes with substantially identical terms as the original 2022 Notes. The registration statement was declared effective by the SEC and we commenced our offering on April 10, 2013. The offer will expire on May 8, 2013, or on such subsequent date or time to which we may extend the offer. If we are unable to timely complete our registration obligation, we will be subject to interest penalties.

The Notes contain a number of customary representations, warranties and restrictive covenants, including, but not limited to, restrictions on our ability to grant liens on assets; enter into sale and lease-back transactions; or merge, consolidate or sell assets. Failure to comply with these covenants, or any other event of default, could result in acceleration of the principal amount and accrued but unpaid interest on the Notes.

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Relative to our overall indebtedness, the Notes rank in right of payment (i) equal with all of our other existing and future senior unsecured indebtedness (ii) senior to all of our existing and future subordinated indebtedness, and (iii) effectively subordinated to all of our subsidiaries' existing and future indebtedness and other obligations (including secured and unsecured obligations) and subordinated to our existing and future secured indebtedness and other obligations, to the extent of the assets securing such indebtedness and other obligations.

Other Notes and Borrowings

We had no other significant notes or borrowings as of March 31, 2013.

Commitments and Other Contractual Obligations

There have been no material changes in the three months ended March 31, 2013 to the amounts presented in the table under the "Commitments and Other Contractual Obligations" section in Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operation" of our 2012 Annual Report.

Prospective Capital Needs

We believe that our existing cash, cash equivalents and marketable securities, together with cash generated from operations and from the issuance of common stock through our employee stock option and purchase plans, will be sufficient to cover our working capital needs, capital expenditures, investment requirements, commitments, repurchases of our Class A common stock and quarterly dividends for at least the next 12 months. However, it is possible that we may choose to raise additional funds or draw on our existing credit facility to finance our activities beyond the next 12 months or to consummate acquisitions of other businesses, assets, products or technologies. If needed, we may be able to raise such funds by selling equity or debt securities to the public or to selected investors or by borrowing money from financial institutions. We could also reduce certain expenditures, such as repurchases of our Class A common stock and payments of our quarterly dividends.

We earn a significant amount of our operating income outside the U.S., which is deemed to be permanently reinvested in foreign jurisdictions. For at least the next 12 months, we have sufficient cash in the U.S. and expect domestic cash flow to sustain our operating activities and cash commitments for investing and financing activities, such as acquisitions, quarterly dividends, share buy-backs and repayment of debt. In addition, we expect existing foreign cash, cash equivalents, short-term investments, and cash flows from operations to continue to be sufficient to fund our foreign operating activities and cash commitments for investing activities, such as material capital expenditures, for at least the next 12 months. If we were to repatriate our foreign earnings, which are permanently reinvested, it would not result in a significant tax liability because the amounts would be offset by our remaining net operating loss and tax credit carryforwards.

In addition, even though we may not need additional funds, we may still elect to sell additional equity or debt

securities or utilize or increase our existing credit facilities for other reasons. However, we may not be able to obtain

additional funds on a timely basis at acceptable terms, if at all. If we raise additional funds by issuing additional

equity or convertible debt securities, the ownership percentages of existing shareholders would be reduced. In

addition, the equity or debt securities that we issue may have rights, preferences or privileges senior to those of our

Class A common stock.

As of March 31, 2013 we have approximately $1.56 billion of cash, cash equivalents, and marketable securities held by our foreign subsidiaries. Any potential additional income, which could result if we were to repatriate our remaining foreign cash, cash equivalents and marketable securities would be offset by existing net operating loss and research and development tax credit carryforwards and should not have a material effect on our tax liabilities.

Off-Balance Sheet Arrangements

At March 31, 2013 we had no material off-balance sheet arrangements, other than our facility operating leases.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

We manage our total portfolio to encompass a diversified pool of investment-grade securities to preserve principal and maintain liquidity. The average credit rating of our marketable securities portfolio by major credit rating agencies was Aa3/AA-. Investments in both fixed rate and floating rate instruments carry a degree of interest rate risk. Fixed rate securities may have their market value adversely impacted due to an increase in interest rates, while floating rate securities may produce less income than expected if interest rates fall. Due in part to these factors, our future investment income, net, may fall short of expectations due to changes in interest rates or if the decline in fair value of our publicly traded fixed income investments is judged to be other-than-temporary. We may suffer losses in principal if we are forced to sell securities that have declined in market value due to changes in interest rates. However, because any fixed income securities we hold are classified as available-for-sale, no gains or losses are realized in the income statement due to changes in interest rates unless such securities are sold prior to maturity or unless declines in value are determined to be other-than-temporary. These securities are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive loss, a component of shareholders’ equity, net of tax.

To assess the interest rate risk associated with our investment portfolio, we performed a sensitivity analysis to determine the impact a change in interest rates would have on the value of the investment portfolio assuming a 100 basis point parallel shift in the yield curve. Based on investment positions as of March 31, 2013, a 100 basis point increase in interest rates across all maturities would result in a $28 million incremental decline in the fair market value of the portfolio. Such losses would only be realized if we sold the investments prior to maturity.

Actual future gains and losses associated with our investments may differ from the sensitivity analysis performed as of March 31, 2013 due to the inherent limitations associated with predicting the changes in the timing and level of interest rates and our actual exposures and positions.

A hypothetical increase of 100 basis points in short-term interest rates would not have a material impact on our revolving credit facility, which bears a floating interest rate. This sensitivity analysis assumes all other variables will remain constant in future periods.

Our Notes bear fixed interest rates, and therefore, would not be subject to interest rate risk.

Exchange Rate Risk

We consider our direct exposure to foreign exchange rate fluctuations to be minimal. Currently, sales to customers and arrangements with third-party manufacturers provide for pricing and payment in United States dollars, and, therefore, are not subject to exchange rate fluctuations. Increases in the value of the United States’ dollar relative to other currencies could make our products more expensive, which could negatively impact our ability to compete. Conversely, decreases in the value of the United States dollar relative to other currencies could result in our suppliers raising their prices to continue doing business with us. Our direct exposure to foreign exchange rate fluctuations is limited primarily to employee costs for employees based outside of the U.S. Fluctuations in currency exchange rates could affect our business in the future.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We are committed to maintaining disclosure controls and procedures designed to ensure that information required to be disclosed in our periodic reports filed under the Securities Exchange Act of 1934, as amended, or the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures and implementing controls and procedures based on the application of management’s judgment.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rules

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13a-15(e) and 15d-15(e) promulgated under the Exchange Act. Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2013, the end of the period covered by this Report.

Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the three months ended March 31, 2013 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Internal Control

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of management override or improper acts, if any, have been detected. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of simple errors or mistakes. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Because of the inherent limitations in a cost-effective control system, misstatements due to management override, error or improper acts may occur and not be detected. Any resulting misstatement or loss may have an adverse and material effect on our business, financial condition and results of operations.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

The information set forth under Note 8 of Notes to Unaudited Condensed Consolidated Financial Statements, included in Part I, Item 1 of this Report, is incorporated herein by reference. For an additional discussion of certain risks associated with legal proceedings, see “Risk Factors” immediately below.

Item 1A. Risk Factors

Before deciding to purchase, hold or sell our common stock, you should carefully consider the risks described below in addition to the other information contained in this Report and in our other filings with the SEC, including our 2012 Annual Report and subsequent reports on Forms 10-Q and 8-K. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our business. If any of these known or unknown risks or uncertainties actually occurs with material adverse effects on Broadcom, our business, financial condition, results of operations and/or liquidity could be seriously harmed. In that event, the market price for our Class A common stock will likely decline, and you may lose all or part of your investment.

Our quarterly operating results may fluctuate significantly.

Our quarterly net revenue and operating results have fluctuated significantly in the past and are likely to continue to vary from quarter to quarter. Variability in the nature of our operating results may be attributed to the factors identified throughout this “Risk Factors” section, many of which may be outside our control, including:

• changes in economic conditions in the markets we address, including the continuing volatility in the technology sector and semiconductor industry;

• seasonality in sales of consumer and enterprise products in which our products are incorporated;

• our dependence on a few significant customers and/or design wins for a substantial portion of our revenue;

• timing, rescheduling or cancellation of significant customer orders and our ability, as well as the ability of our customers, to manage inventory;

• changes in customer product needs and market acceptance of our products;

• competitive pressures and other factors such as the qualification, availability and pricing of competing products and technologies and the resulting effects on sales and pricing of our products;

• the impact of a significant natural disaster, such as an earthquake, severe weather, tsunami or other flooding, or a nuclear crisis, as well as interruptions or shortages in the supply of utilities such as water and electricity, in a key

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location such as our corporate headquarters or our Northern California facilities, both of which are located near major earthquake fault lines, in our Singapore distribution center or in a key location of one of our suppliers, foundries or customers;

• the impact of enterprise system failures or network disruptions, the lack of system redundancies, and the potential failure of our disaster recovery planning to cover various unanticipated occurrences; and

• the impact of tax examinations.

We depend on a few significant customers for a substantial portion of our revenue.

We derive a substantial portion of our revenue from sales to a relatively small number of customers. Contributions to our net revenue by these customers have increased in the last several years. Sales to our five largest customers represented 51.4%, and 49.2% of our total net revenue in the three months ended March 31, 2013 and 2012, respectively. Sales to two significant customers, those representing 10% or more of total net revenue, represented 36.8% and 31.3% of our total net revenue in the three months ended March 31, 2013 and 2012, respectively. We expect that our largest customers will continue to account for a substantial portion of our total net revenue for the foreseeable future. The loss of any significant customer could materially and adversely affect our financial condition and results of operations. Also, as our significant customers become larger relative to our business and the industry, they may be able to leverage pricing pressure through the supply chain, vertical integration or other avenues, thereby adversely affecting our gross margins.

A significant portion of our revenue in any period may also depend on a single product design win with a large customer. As a result, the loss of any such key design win or any significant delay in the ramp of volume production of the customer’s products into which our product is designed could materially and adversely affect our financial condition and results of operations. We may not be able to maintain sales to certain of our key customers or continue to secure key design wins for a variety of reasons, including:

• agreements with our customers typically do not require them to purchase a minimum quantity of our products; and

• our customers can stop incorporating our products into their own products with limited notice to us and suffer little or no penalty.

In addition, the vast majority of our licensing revenue and related income to date has been derived from the Qualcomm Agreement. From April 2009 through March 31, 2013, we recorded $813 million in income derived from this agreement and we expect to record an additional $43 million in the three months ending June 30, 2013. The income from the Qualcomm Agreement is non-recurring and will terminate in April 2013. There can be no assurances that we will be able to enter into additional such arrangements of this magnitude in the future, or that we will be able to successfully collect the remaining payments due to us under the Qualcomm Agreement in the event of a default by Qualcomm.

The loss of a key customer or design win, a reduction in sales to any key customer, decrease in licensing revenue and related income, significant delay in our customers’ product development plans, or our inability to attract new significant customers or secure new key design wins could seriously impact our revenue and materially and adversely affect our results of operations.

We face intense competition.

The semiconductor industry and the wired and wireless communications markets are intensely competitive. We expect competition to continue to increase as new markets develop, as industry standards become well known and as other competitors enter our business. We expect to encounter further consolidation in the markets in which we compete.

Some of our competitors have longer operating histories and presences in key markets, greater name recognition, larger customer bases, and significantly greater financial, sales and marketing, manufacturing, distribution, technical and other resources than we do, and in some cases operate their own fabrication facilities. These competitors may be able to adapt more quickly to new or emerging technologies and changes in customer requirements. They may also be able to devote greater resources to the promotion and sale of their products. We also face competition from newly established competitors, suppliers of products, and customers who choose to develop their own semiconductor solutions.

Existing or new competitors may develop technologies that more effectively address our markets with products that offer enhanced features and functionality, lower power requirements, greater levels of integration or lower cost. Increased competition also has resulted in and is likely to continue to result in increased expenditures on research and development, declining average selling prices, reduced gross margins and loss of market share in certain markets. These factors in turn create increased pressure to consolidate. We cannot assure you that we will be able to continue to compete successfully against current

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or new competitors. If we do not compete successfully, we may lose market share in our existing markets and our revenues may fail to increase or may decline.

Our operating results may be adversely impacted by worldwide economic uncertainties and specific conditions in the markets we address.

We operate primarily in the semiconductor industry, which is cyclical and subject to rapid change and evolving industry standards. From time to time, the semiconductor industry has experienced significant downturns characterized by decreases in product demand, excess customer inventories and accelerated erosion of prices. The semiconductor industry also periodically experiences increased demand and production capacity constraints, which may affect our ability to ship products. An increasing number of our products are being incorporated into consumer electronic products, which are subject to significant seasonality and fluctuations in demand. Economic volatility can cause extreme difficulties for our customers and vendors in accurately forecasting and planning future business activities. This unpredictability could cause our customers to reduce spending on our products and services, which would delay and lengthen sales cycles. Furthermore, during challenging economic times our customers and vendors may face challenges in gaining timely access to sufficient credit, which could impact their ability to make timely payments to us. As a result, we may experience growth patterns that are different than the demand for our customers' products, particularly during periods of high volatility.

We cannot predict the timing, strength or duration of any economic slowdown or recovery or the impact of such events on our customers, our vendors or us. The combination of our lengthy sales cycle coupled with challenging macroeconomic conditions and supply chain cross-dependencies could have a compound impact on our business. The impact of market volatility is not limited to revenue but may also affect our product gross margins and other financial metrics. Any downturn in the semiconductor industry may be severe and prolonged, and any failure of the industry or wired and wireless communications markets to fully recover from downturns could seriously impact our revenue and harm our business, financial condition and results of operations.

We may fail to adjust our operations in response to changes in demand.

Through internal growth and acquisitions, we significantly modified the scope of our operations and workforce in recent years. Our operations are characterized by a high percentage of costs that are fixed or difficult to reduce in the short term, such as research and development expenses related to our highly skilled workforce. During some periods, our growth has placed a significant strain on our management personnel, systems and resources. To respond to periods of increased demand, we will be required to expand, train, manage and motivate our workforce, and to upgrade or enhance our existing IT systems. For example, over the next three years, we plan to upgrade our enterprise resource planning system. We may not be successful in implementing new systems, which could involve business disruptions, including impeding the shipment of our products.

If we are unable to effectively manage our expanding operations, we may be unable to adjust our business quickly enough to meet competitive challenges or exploit potential market opportunities. Conversely, we may scale our business too quickly and the rate of increase in our expenses may exceed the rate of increase in our revenue, causing the need to implement restructuring actions and a number of other cost saving measures. Any of these circumstances could materially and adversely affect our current or future business.

We may be required to defend against alleged infringement of intellectual property rights of others and/or may be unable to adequately protect or enforce our own intellectual property rights.

Companies in the semiconductor industry and the wired and wireless communications markets aggressively protect and pursue their intellectual property rights. From time to time, we receive notices that claim we have infringed upon, misappropriated or misused other parties’ proprietary rights. Additionally, we receive notices that challenge the validity of our patents. Some of these notices involve "non-practicing entities," or NPEs, asserting claims addressing certain of our products. Intellectual property litigation can be expensive, time consuming and distracting to management. An adverse determination in any of these types of disputes could prevent us from manufacturing or selling some of our products or could prevent us from enforcing our intellectual property rights. Further, settlements can involve royalty or other payments that could reduce our profit margins and adversely affect our financial results.

We may also be required to indemnify some customers and strategic partners under our agreements if a third party alleges or if a court finds that our products or activities have infringed upon, misappropriated or misused another party’s proprietary rights. We have received requests from certain customers and strategic partners to include increasingly broad indemnification provisions in our agreements with them. These indemnification provisions may, in some circumstances, extend our liability beyond the products we provide to include liability for combinations of components or system level designs and for

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consequential damages and/or lost profits. Even if claims or litigation against us are not valid or successfully asserted, these claims could result in significant costs and diversion of the attention of management and other key employees to defend.

Our products may contain technology provided to us by other parties such as contractors, suppliers or customers. We may have little or no ability to determine in advance whether such technology infringes the intellectual property rights of a third party. Our contractors, suppliers and licensors may not be required to indemnify us in the event that a claim of infringement is asserted against us, or they may be required to indemnify us only up to a maximum amount, above which we would be responsible for any further costs or damages. Any of these claims or litigation may materially and adversely affect our business, financial condition and results of operations.

Furthermore, our success and future revenue growth will depend, in part, on our ability to protect our intellectual property. It is possible that competitors or other unauthorized third parties may obtain, copy, use or disclose our technologies and processes, or confidential employee, customer or supplier data. Any of our existing or future patents may be challenged, invalidated or circumvented. We engage in litigation to enforce or defend our intellectual property rights, protect our trade secrets, or determine the validity and scope of the proprietary rights of others, including our customers. We also enter into confidentiality agreements with our employees, consultants and strategic partners and control access to and distribution of our technologies, documentation and other proprietary information. Despite these efforts, internal or external parties may attempt to copy, disclose, obtain or use our products, services or technology without our authorization. If we cannot adequately protect our technology, our competitors may be able to offer products similar to ours.

Our software may be derived from “open source” software, which is generally made available to the public by its authors and/or other third parties. Open source software is often made available under licenses, which impose certain obligations in the event we distribute derivative works of the open source software. These obligations may require us to make

source code for the derivative works available to the public, and/or license such derivative works on different terms than those customarily used to protect our intellectual property. With respect to our proprietary software, we generally license such software under terms that prohibit combining it with open source software. Despite these restrictions, parties may combine our proprietary software with open source software without our authorization, in which case we might nonetheless be required to release the source code of our proprietary software.

We cannot assure you that our efforts to prevent the misappropriation or infringement of our intellectual property or the intellectual property of our customers will succeed. Identifying unauthorized use of our products and technologies is difficult and time consuming. The initiation of litigation may adversely affect our relationships and agreements with certain customers that have a stake in the outcome of the litigation proceedings. Litigation is very expensive and may divert the attention of management and other key employees from the operation of the business, which could negatively impact our business and results of operations.

Our stock price is highly volatile.

The market price of our Class A common stock has fluctuated substantially in the past and is likely to continue to be highly volatile and subject to wide fluctuations. From January 1, 2010 through March 31, 2013 our Class A common stock has traded at prices as low as $26.40 and as high as $47.39 per share. Fluctuations have occurred and may continue to occur in response to various factors, many of which we cannot control.

In addition, the market prices of securities of Internet-related, semiconductor and other technology companies have been and remain volatile. This volatility has significantly affected the market prices of securities of many technology companies for reasons frequently unrelated to the operating performance of the specific companies. If our operating results do not meet the expectations of securities analysts or investors, who may derive their expectations by extrapolating data from recent historical operating results, the market price of our Class A common stock will likely decline. Accordingly, you may not be able to resell your shares of common stock at or above the price you paid. In the past, we, and other companies that have experienced volatility in the market price of their securities, have been the subject of securities class action litigation.

Due to the nature of our compensation programs, most of our executive officers sell shares of our common stock each quarter or otherwise periodically, often pursuant to trading plans established under Rule 10b5-1 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, sales of shares by our executive officers may not be indicative of their respective opinions of Broadcom’s performance at the time of sale or of our potential future performance. Nonetheless, the market price of our stock may be affected by sales of shares by our executive officers.

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We are subject to order and shipment uncertainties.

It is difficult to accurately predict demand for our semiconductor products. We typically sell products pursuant to purchase orders rather than long-term purchase commitments. Customers can generally cancel, change or defer purchase orders on short notice without incurring a significant penalty. Our ability to accurately forecast customer demand is further impaired by delays inherent in our lengthy sales cycle. We operate in a dynamic industry and use significant resources to develop new products for existing and new markets. After we have developed a product, there is no guarantee that our customers will integrate our product into their equipment or devices and, ultimately, bring those equipment and devices incorporating our product to market. In these situations, we may never produce or deliver a significant number of our products, even after incurring substantial development expenses. From the time a customer elects to integrate our solution into their product, it is typically six to 24 months before high volume production of that product commences. After volume production begins, we cannot be assured that the equipment or devices incorporating our product will gain market acceptance.

Our products are incorporated into complex devices and systems, creating supply chain cross-dependencies. Accordingly, supply chain disruptions affecting components of our customers’ devices and/or systems could negatively impact the demand for our products, even if the supply of our products is not directly affected.

Our product demand forecasts are based on multiple assumptions, each of which may introduce error into our estimates. In the event we overestimate customer demand, we may allocate resources to manufacturing products that we may not be able to sell. As a result, we could hold excess or obsolete inventory, which would reduce our profit margins and adversely affect our financial results. Conversely, if we underestimate customer demand or if insufficient manufacturing capacity is available, we could forego revenue opportunities and potentially lose market share and damage our customer relationships. Also, due to our industry’s use of “just-in-time” inventory management, any disruption in the supply chain could lead to more immediate shortages in product or component supply. Additionally, any enterprise system failures, including in connection with implementing new systems, could impact our ability to fulfill orders and interrupt other processes.

A portion of our inventory is maintained under hubbing and distribution arrangements whereby products are delivered to a customer or third party warehouse based upon the customer’s projected needs. Under these arrangements, we do not recognize product revenue until the customer reports that it has removed our product from the warehouse to incorporate into its end products. Our ability to effectively manage inventory levels may be impaired under such arrangements, which could increase expenses associated with excess and obsolete product inventory and negatively impact our cash flow.

We manufacture and sell complex products and may be unable to successfully develop and introduce new products.

We expect that a high percentage of our future sales will come from sales of new products. We sell products in markets that are characterized by rapid technological change, evolving industry standards, frequent new product introductions and short product life cycles. The markets for some of these products are new to us and may be immature and/or unpredictable. These markets may not develop into profitable opportunities and we have in the past invested substantial resources in emerging technologies that did not achieve the market acceptance that we had expected. As a result, it is difficult to anticipate our future revenue streams from, or the sustainability of, our new products.

Our industry is dynamic and we are required to devote significant resources to research and development to remain competitive. Such costs increase with the advancement of technologies and manufacturing in smaller geometry processes, which can adversely affect our operating margin. The development of new silicon devices is highly complex, and due to supply chain cross-dependencies and other issues, we may experience delays in completing the development, production and introduction of our new products. We may choose to discontinue one or more products or product development programs to dedicate more resources to other products. The discontinuation of an existing or planned product may adversely affect our relationship with one or more of our customers and/or could cause us to incur an impairment charge.

Our ability to successfully develop and deliver new products will depend on various factors, including our ability to:

• effectively identify and capitalize upon opportunities in new markets;

• timely complete and introduce new integrated products;

• transition our semiconductor products to increasingly smaller line width geometries;

• obtain sufficient foundry capacity (including at smaller geometry processes) and packaging materials;

• license any desired third party technology or intellectual property rights; and

• qualify and obtain industry interoperability certification of our products.

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If we are not able to develop and introduce new products in a cost effective and timely manner, we will be unable to attract new customers or to retain our existing customers which would materially and adversely affect our results of operations.

We have experienced hardware and software defects and bugs associated with the introduction of our highly complex products. If any of our products contain defects or bugs, or have reliability, quality, security or compatibility problems, our reputation may be damaged and customers may be reluctant to buy our products. These problems could interrupt or delay sales and shipments of our products to customers. To alleviate these problems, we may have to divert our resources from other development efforts. In addition, these problems could result in claims against us by our customers or others, including possible claims for consequential damages and/or lost profits. As we transition to manufacturing our products in smaller geometry processes, such as 28 nanometers and below, these risks are enhanced.

We depend on third parties to fabricate, assemble and test our products.

As a fabless semiconductor company, we do not own or operate fabrication, assembly or test facilities. We rely on third parties to manufacture, assemble and test substantially all of our semiconductor devices. Accordingly, we cannot directly control our product delivery schedules and quality assurance. This lack of control could result in product shortages or quality assurance problems. These issues could delay shipments of our products or increase our assembly or testing costs. In addition, the consolidation of foundry subcontractors, as well as the increasing capital intensity and complexity associated with fabrication in smaller process geometries has limited our diversity of suppliers and increased our risk of a "single point of failure." Specifically, as we move to smaller geometries, we have become increasingly reliant on TSMC for the manufacture of product at and below 40 nanometers. The lack of diversity of suppliers could also drive increased wafer prices, adversely affect our results of operations, including our product gross margins.

We do not have long-term agreements with any of our direct or indirect suppliers, including our manufacturing, assembly or test subcontractors. We typically procure services from these suppliers on a per order basis. In the event our third-party foundry subcontractors experience a disruption or limitation of manufacturing, assembly or testing capacity, we may not be able to obtain alternative manufacturing, assembly and testing services in a timely manner, or at all. Furthermore, our foundries must have new manufacturing processes qualified if there is a disruption in an existing process, which could be time-consuming. We could experience significant delays in product shipments if we are required to find alternative manufacturers, assemblers or testers for our products. We are continuing to develop relationships with additional third-party subcontractors to assemble and test our products.

Because we rely on outside foundries and other third party suppliers, we face several significant risks in addition to those discussed above, including:

• a lack of guaranteed supply of wafers and other components and potential higher wafer and component prices due to supply constraints;

• the limited availability of, or potential delays in obtaining access to, key process technologies; and

• the location of foundries and other suppliers in regions that are subject to earthquakes, tsunamis and other natural disasters.

The manufacture of integrated circuits is a highly complex and technologically demanding process. Our foundries have from time to time experienced lower than anticipated manufacturing yields. This often occurs during the production of new products or the installation and start-up of new process technologies. In addition, we are dependent on our foundry subcontractors to successfully transition to smaller geometry processes.

We face risks associated with our acquisition strategy.

A key element of our business strategy involves expansion through the acquisitions of businesses, assets, products or technologies. The expansion of our business through acquisitions allows us to complement our existing product offerings, expand our market coverage, increase our engineering workforce and/or enhance our technological capabilities. We may not be able to identify or consummate future acquisitions or realize the desired benefit from these acquisitions.

We face a number of challenges associated with our acquisition strategy that could disrupt our ongoing business and distract our management team, including:

• lower gross margins, revenue and operating income than originally anticipated at the time of acquisition and other financial challenges;

• delays in the timing and successful integration of an acquired company’s technologies;

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• the loss of key personnel; and

• becoming subject to intellectual property or other litigation.

Acquisitions can result in increased debt or contingent liabilities. While we believe we will have the ability to service any additional debt we may potentially issue in connection with acquisitions, our ability to make principal and interest payments when due depends upon our future performance, which will be subject to general economic conditions, industry cycles, and business and other factors affecting our operations, including the other risk factors described in this section, many of which are beyond our control. Acquisitions can also result in adverse tax consequences, warranty or product liability exposure related to acquired assets, additional stock-based compensation expense, write up of acquired inventory to fair value, and the recording and later amortization of amounts related to certain purchased intangible assets, all of which can adversely affect our reported results on a GAAP basis. In addition, we have in the past and may in the future record goodwill and other purchased intangible assets in connection with an acquisition and incur impairment charges in the future. As discussed in our 2012 Annual Report under the “Critical Accounting Policies and Estimates” section in Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations," we have determined that we currently have goodwill at risk of potential impairment in future periods related to our Infrastructure and Networking reportable segment.

We are exposed to risks associated with our international operations.

We currently obtain substantially all of our manufacturing, assembly and testing services from suppliers located outside the United States. Products shipped to international destinations, primarily in Asia, represented 97.0% and 96.4% of our product revenue in the three months ended March 31, 2013 and 2012, respectively. Substantially all of our products are shipped through our logistical facilities in Singapore. In addition, we undertake various sales and marketing activities through regional offices in a number of countries. We intend to continue expanding our international business activities and to open other design and operational centers abroad.

International operations are subject to many inherent risks, including but not limited to:

• political, social and economic instability;

• exposure to different business practices and legal and compliance standards;

• continuation of overseas conflicts and the risk of terrorist attacks and resulting heightened security;

• the imposition of governmental controls and restrictions and unexpected changes in regulatory requirements;

• nationalization of business and blocking of cash flows;

• logistical delays or disruptions;

• changes in taxation and tariffs; and

• difficulties in staffing and managing international operations.

Our international operations are subject to increasingly complex foreign and U.S. laws and regulations that increase our cost of doing business in international jurisdictions, including but not limited to anti-corruption laws, such as the Foreign Corrupt Practices Act and the UK Bribery Act and equivalent laws in other jurisdictions, antitrust or competition laws, and data privacy laws, among others. Violations of these laws and regulations could result in fines and penalties, criminal sanctions against us, our officers, or our employees, prohibitions on the conduct of our business and on our ability to offer our products and services in one or more countries, and could also materially affect our reputation, our international expansion efforts, our ability to attract and retain employees, our business, and our operating results. Although we have implemented policies, procedures and training designed to ensure compliance with these laws and regulations, there can be no complete assurance that any individual employee, contractor, or agent will not violate our policies.

Economic conditions in our primary overseas markets, particularly in Asia, may negatively impact the demand for our products abroad. Also, all of our international sales to date have been denominated in U.S. dollars. Accordingly, an increase in the value of the U.S. dollar relative to foreign currencies could make our products less competitive in international markets or require us to assume the risk of denominating certain sales in foreign currencies. We anticipate that these factors will impact our business to a greater degree as we further expand our international business activities.

Our systems are subject to security breaches and other cybersecurity incidents.

We experience cyber attacks of varying degrees on a regular basis, and as a result, unauthorized parties have obtained, and may in the future obtain, access to our computer systems and networks. Such cyber attacks could result in the misappropriation of our proprietary information and technology or interrupt our business. The reliability and security of our information technology infrastructure and software, and our ability to expand and continually update technologies in response to our changing needs is critical to our business. To the extent that any disruptions or security breaches result in significant loss

39

or damage to our data, or inappropriate disclosure of significant proprietary information, it could cause damage to our reputation and affect our relationships with our customers and ultimately harm our business.

There can be no assurance that we will continue to declare cash dividends.

In January 2010, our Board of Directors adopted a dividend policy pursuant to which Broadcom would pay quarterly dividends on our common stock. In January 2011, January 2012, and again in January 2013 our Board of Directors increased the quarterly dividend payment. We intend to continue to pay such dividends subject to capital availability and periodic determinations by our Board of Directors that cash dividends are in the best interest of our shareholders and are in compliance with all laws and agreements of Broadcom applicable to the declaration and payment of cash dividends.

Future dividends may be affected by, among other factors:

• our views on potential future capital requirements for investments in acquisitions and the funding of our research and development;

• use of cash to consummate various acquisition transactions;

• stock repurchase programs;

• changes in federal and state income tax laws or corporate laws; and

• changes to our business model.

Our dividend payments may change from time to time, and we cannot provide assurance that we will continue to increase our dividend payment or declare dividends in any particular amounts or at all. A reduction in our dividend payments could have a negative effect on our stock price.

We may be unable to attract, retain or motivate key personnel.

Our future success depends on our ability to attract, retain and motivate senior management and qualified technical personnel. Competition for these employees is intense. If we are unable to attract, retain and motivate such personnel in sufficient numbers and on a timely basis, we will experience difficulty in implementing our current business and product plans. In that event, we may be unable to successfully meet competitive challenges or to exploit potential market opportunities, which could adversely affect our business and results of operations.

Government regulation may adversely affect our business.

The effects of regulation on our customers or the industries in which they operate may materially and adversely impact our business. For example, the Federal Communications Commission, or FCC, has broad jurisdiction in the United States over many of the devices into which our products are incorporated. FCC regulatory policies that affect the ability of cable or satellite operators or telephone companies to offer certain services to their customers or other aspects of their business may impede sales of our products in the United States. In addition, we may experience delays if a product incorporating our chips fails to comply with FCC emissions specifications.

We and our customers are subject to various import and export laws and regulations. Government export regulations apply to the encryption or other features contained in some of our products. If we fail to continue to receive licenses or otherwise comply with these regulations, we may be unable to manufacture the affected products at foreign foundries or ship these products to certain customers, or we may incur penalties or fines.

Our business may also be subject to regulation by countries other than the United States. Foreign governments may impose tariffs, duties and other import restrictions on components that we obtain from non-domestic suppliers and may impose export restrictions on products that we sell internationally. These tariffs, duties or restrictions could materially and adversely affect our business, financial condition and results of operations.

Our product or manufacturing standards could also be impacted by new or revised environmental rules and regulations or other social initiatives. For instance, the SEC adopted new disclosure requirements in 2012 relating to the sourcing of certain minerals from the Democratic Republic of Congo and certain other adjoining countries. Those new rules, which will require reporting in 2014, could adversely affect our costs, the availability of minerals used in our products and our relationships with customers and suppliers.

40

Our business is subject to potential tax liabilities.

We are subject to income taxes in the United States and various foreign jurisdictions. The amount of income taxes we pay is subject to our interpretation and application of tax laws in jurisdictions in which we file. Changes in current or future laws or regulations, or the imposition of new or changed tax laws or regulations or new related interpretations by taxing authorities in the U.S. or foreign jurisdictions, could adversely affect our results of operations. We are subject to examinations and tax audits. There can be no assurance that the outcomes from these audits will not have an adverse effect on our net operating loss and research and development tax credit carryforwards, our financial position, or our operating results.

In certain foreign jurisdictions, we operate under tax holidays and favorable tax incentives. For instance, in Singapore we operate under tax holidays, which are effective through March 31, 2014, that reduce taxes on substantially all of our operating income in that jurisdiction. Such tax holidays and incentives often require us to meet specified employment and investment criteria in such jurisdictions. In a period of tight manufacturing capacity, our ability to meet Singaporean content in our products may be more limited, which may have adverse tax consequences. More generally, if any of our tax holidays or incentives are terminated or if we fail to meet the criteria to continue to enjoy such holidays or incentives, our results of operations may be materially and adversely affected. We are in discussions with the Singapore Economic Development Board with respect to tax incentives for periods after March 31, 2014. No assurances can be given that such discussions will be successful. If we are unable to reach an agreement with Singapore (or another jurisdiction that provides similar benefits to those we realize from our current incentives in Singapore), our results of operations and financial position for periods after March 31, 2014 will be adversely affected.

Our articles of incorporation and bylaws contain anti-takeover provisions.

Our articles of incorporation and bylaws contain provisions that could make it more difficult for a third party to acquire a majority of our outstanding voting stock. For example, our Board of Directors may also issue shares of Class B common stock in connection with certain acquisitions, which have superior voting rights entitling the holder to ten votes for each share held on matters that we submit to a shareholder vote (as compared to one vote per share in the case of our Class A common stock) as well as the right to vote separately as a class. In addition, our Board of Directors has the authority to fix the rights and preferences of shares of our preferred stock and to issue shares of common or preferred stock without a shareholder vote. These provisions, among others, may discourage certain types of transactions involving an actual or potential change in our control.

Our co-founders and their affiliates may strongly influence the outcome of matters that require the approval of our shareholders.

As of March 31, 2013 our co-founders, directors, executive officers and their respective affiliates beneficially owned 9.9% of our outstanding common stock and held 49.2% of the total voting power held by our shareholders. As a result, the voting power of these shareholders may strongly influence the outcome of matters that require the approval of our shareholders. These matters include the election of our Board of Directors, the issuance of additional shares of Class B common stock, and the approval of most significant corporate transactions, including certain mergers and consolidations and the sale of all or substantially all of our assets. In particular, as of March 31, 2013 our two founders, Dr. Henry T. Nicholas III and Dr. Henry Samueli, beneficially owned a total of 8.8% of our outstanding common stock and held 48.8% of the total voting power held by our shareholders. Because of their significant voting stock ownership, we may not be able to engage in certain transactions, and our shareholders may not be able to effect certain actions or transactions, without the approval of these shareholders. Repurchases of shares of our Class A common stock under our share repurchase program would result in an increase in the total voting power of our co-founders, directors, executive officers and their affiliates, as well as other continuing shareholders.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In the three months ended March 31, 2013 we issued an aggregate of 342,000 shares of Class A common stock upon conversion of a like number of shares of Class B common stock in connection with their disposition. Each share of Class B common stock is convertible at any time into one share of Class A common stock at the option of the holder. The offers and sales of those securities were effected without registration in reliance on the exemption from registration provided by Section 3(a)(9) of the Securities Act of 1933, as amended.

Issuer Purchases of Equity Securities

In February 2010, we announced that our Board of Directors had authorized an evergreen share repurchase program intended to offset dilution associated with our stock incentive plans. The maximum number of shares of our Class A common stock that may be repurchased in any one year under this program (including under an accelerated share repurchase or other

41

arrangement) is equal to the total number of shares issued pursuant to our equity awards in the previous year and the current year. This program does not have an expiration date and may be suspended at any time at the discretion of the Board of Directors. It may also be complemented with an additional share repurchase program in the future.

The following table presents details of our various repurchases during the three months ended March 31, 2013:

Period	Total Number of Shares Purchased	Average Price per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans	Approximate Dollar Value of Shares That May yet be Purchased under the Plans
	(In millions, except per share data)
January 2013	—	$	—	—
February 2013	3.2	33.42		3.2
March 2013	—	—		—
Total	3.2	$	33.42	3.2	N/A

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not Applicable

Item 5. Other Information

None.

Item 6. Exhibits

(a)Exhibits. The following Exhibits are attached hereto and incorporated herein by reference:

Exhibit
Number	Description
10.1	Letter Agreement for Change in Control Severance Benefit Program dated April 1, 2013 between the registrant and Michael E. Hurlston.
31.1	Certifications of the Chief Executive Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certifications of the Chief Financial Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32	Certifications of the Chief Executive Officer and Chief Financial Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and furnished herewith pursuant to SEC Release No. 33-8238.
101. INS	XBRL Instance Document
101. SCH	XBRL Taxonomy Extension Schema Document
101. CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101. DEF	XBRL Taxonomy Extension Definition Linkbase Document
101. LAB	XBRL Taxonomy Extension Label Linkbase Document
101. PRE	XBRL Taxonomy Extension Presentation Linkbase Document

42

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

BROADCOM CORPORATION,

a California corporation

(Registrant)

/S/ ERIC K. BRANDT

Eric K. Brandt

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

/S/ ROBERT L. TIRVA

Robert L. Tirva

Senior Vice President and Corporate Controller

(Principal Accounting Officer)

April 23, 2013

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EX-10.1

April 1, 2013

Michael E. Hurlston

Executive Vice President, Worldwide Sales

Broadcom Corporation

5300 California Avenue

Irvine, California 92617

Dear Mike:

Broadcom Corporation considers it essential to its best interests and those of its shareholders that you be encouraged to remain with the company and continue to devote your full attention to Broadcom’s business, notwithstanding the possibility that your employment with Broadcom might end in connection with or following a Change of Control event defined in Section 1 of the Appendix (“Change in Control”) to this letter agreement (the “Agreement”). Accordingly, the Compensation Committee of the Broadcom Board of Directors (the “Compensation Committee”) has selected you as a participant in the special change in control severance benefit program (the “Program”).

Capitalized terms not defined in this Agreement are defined in the Appendix attached hereto, which is hereby incorporated as though set forth in full herein.

The initial term of your participation in the Program will commence today and will continue through August 18, 2013 (such term, together with any renewals thereof, to constitute the “Term”). On August 19 of each calendar year, beginning with the 2013 calendar year, the Term shall, without any action by Broadcom or the Compensation Committee, automatically be extended for one (1) additional year unless, before any such automatic renewal date, the Compensation Committee, by a majority vote, expressly determines that the automatic extension for such year shall not apply.

Employment with Broadcom is at-will, and Broadcom may unilaterally terminate your employment with or without “Cause” or in the event of your “Disability.” You may terminate your employment with or without “Good Reason,” and your employment will automatically terminate upon your death. Any termination of your employment by Broadcom or you during the Term (or, if your employment extends beyond the Term, during the first twenty-four (24) months following a Change in Control that occurs during the Term) shall be communicated by a “Notice of Termination.”

If a Change in Control is effected during the Term and within twenty-four (24) months after the effective date of that Change in Control:

(i)     Broadcom unilaterally terminates your employment other than for Cause or Disability, or

(ii)     you terminate your employment for Good Reason,

1

Broadcom shall make the payments and provide the benefits described below, provided you were employed on a full-time basis by Broadcom immediately prior to such termination and, with respect to certain of those benefits, there is compliance with each of the following requirements (the “Severance Benefit Requirements”):

(i)     you deliver the general release required under Section 11 of the attached Appendix (the “Required Release”) within the applicable time period following your Date of Termination,

(ii)     the Required Release becomes effective in accordance with applicable law following the expiration of any applicable revocation period,

(iii)     you comply with each of the restrictive covenants set forth in Section 9, and

(iv)    you are and continue to remain in material compliance with your obligations to Broadcom under your Confidentiality and Invention Assignment Agreement.

The payments and benefits to which you will become entitled if all the Severance Benefits Requirements are satisfied are as follows:

(1)    Cash Severance. Broadcom will pay you cash severance (“Cash Severance”) in an amount equal to two (2) times the sum of (A) your annual rate of base salary (using your then current rate or, if you terminate your employment for Good Reason pursuant to Subsection 3(ii) of the attached Appendix due to an excessive reduction in your base salary, then your rate of base salary immediately before such reduction) and (B) the average of your actual annual bonuses for the three calendar years (or such fewer number of calendar years of employment with Broadcom) immediately preceding the calendar year in which such termination of employment occurs. Such Cash Severance shall be payable over a twenty-four (24)-month period in successive equal bi-weekly or semi-monthly installments in accordance with the payment schedule in effect for your Base Salary on your Date of Termination (the “Payment Schedule”), except that, subject to the deferral provisions of Section 8 below, the Cash Severance payments will begin on the sixtieth (60^th) day following the date of your Separation from Service (with any amounts otherwise payable prior to such sixtieth (60^th) day pursuant to the Payment Schedule instead being paid on such sixtieth (60^th) day without interest thereon). The installment payments shall cease once you have received the full amount of your Cash Severance. The installment payments shall be treated as a series of separate payments for purposes of the final Treasury Regulations under Section 409A (“Section 409A”) of the Internal Revenue Code of 1986, as amended (the “Code”). However, the amount of Cash Severance to which you may be entitled pursuant to the foregoing provisions of this Section 1 shall be subject to reduction in accordance with Section 9 in the event you breach your restrictive covenants under Section 9.

(2)    Options and Other Equity Awards. Notwithstanding any less favorable terms of any stock option or other equity award agreement or plan, any options to

2

purchase shares of Broadcom’s common stock or any restricted stock units or other equity awards granted to you by Broadcom, whether before or after the date of this Agreement, that are outstanding on your Date of Termination but not otherwise fully vested shall be subject to accelerated vesting in accordance with the following provisions:

(i)    On the date your timely executed and delivered Required Release becomes effective following the expiration of the maximum review/delivery period and any applicable revocation period (the “Release Condition”), you will receive twenty-four (24) months of service vesting credit under each of your outstanding stock options, restricted stock units and other equity awards.

(ii)    The portion of each of your outstanding stock options, restricted stock units and other equity awards that remains unvested after your satisfaction of the Release Condition will vest in a series of twenty-four (24) successive equal monthly installments over the twenty-four (24)-month period measured from your Date of Termination (the “Additional Monthly Vesting”), provided that during each successive month within that twenty-four (24)-month period (x) you must comply with all of your obligations under your Confidentiality and Invention Assignment Agreement with Broadcom that survive the termination of your employment with Broadcom and (y) you must comply with the restrictive covenants set forth in Section 9. In the event that you violate the Confidentiality and Invention Assignment Agreement or engage in any of the activities precluded by the restrictive covenants set forth in Section 9, you shall not be entitled to any Additional Monthly Vesting for and after the month in which such violation or activity (as the case may be) occurs.

In addition, the period for exercising each option that accelerates in accordance with subparagraph (i) or (ii) above shall be extended from the limited post-termination period otherwise provided in the applicable stock option agreement until the earlier of (A) the end of the twenty-four (24)-month period measured from your Date of Termination or (if later) the end of the one-month period measured from each installment vesting date of that option in accordance herewith or (B) the applicable expiration date of the maximum ten (10)-year or shorter option term.

Upon your satisfaction of the Release Condition, the limited post-termination exercise period for any other options granted to you by Broadcom and outstanding on your Date of Termination shall also be extended in the same manner and to the same extent as your accelerated options.

The shares of Broadcom Class A common stock underlying any restricted stock unit award that vests on an accelerated or Additional Monthly Vesting basis in accordance with this Section 2 shall be issued as follows: The shares subject to that award that vest upon the satisfaction of the Release Condition shall be issued on the sixtieth (60th) day following the date of your Separation from Service (“Initial Issuance Date”), and each remaining share subject to such restricted stock unit award shall be issued on the next regularly-scheduled share issuance date for that restricted stock unit award (currently, the 5th day of February, May, August and November each year) following the prescribed

3

vesting date for that share in accordance with this Section 2, but in no event earlier than the Initial Issuance Date.

(3)    Lump Sum Benefit Payments. Provided you satisfy the Release Condition, the following special payments shall be made to you to provide you with a source of funding to cover a portion of the cost of any health care, life insurance and disability insurance coverage you obtain following your Date of Termination:

(i).    Provided you and your spouse and eligible dependents elect to continue medical care coverage under Broadcom’s group health care plans pursuant to the applicable COBRA provisions, Broadcom will make a lump sum cash payment (the “Lump Sum Health Care Payment”) to you in an amount equal to thirty-six (36) times the amount by which (A) the monthly cost payable by you, as measured as of your Date of Termination, to obtain COBRA coverage for yourself, your spouse and eligible dependents under Broadcom’s employee group health plan at the level in effect for each of you on such Date of Termination exceeds (B) the monthly amount payable at such time by a similarly-situated executive whose employment with Broadcom has not terminated to obtain group health care coverage at the same level. Broadcom shall pay the Lump Sum Health Care Payment to you on the sixtieth (60th) day following the date of your Separation from Service. Notwithstanding the foregoing, the Lump Sum Health Care Payment shall be subject to the deferred payment provisions of Section 8 below, to the extent necessary to avoid the imposition of taxes in connection with a prohibited distribution under Section 409A(a)(2) of the Code. In addition, Broadcom cannot provide any assurances hereunder as to the maximum period for which you and your spouse and dependents may in fact be entitled to COBRA health care coverage under the Broadcom group health care plans, and it is expected that such coverage will cease prior to the expiration of the thirty-six (36) month period measured from your Date of Termination, except under certain limited circumstances.

(ii).     You shall also be entitled to an additional lump sum cash payment (the “Lump Sum Insurance Benefit Payment”) from Broadcom in an amount equal to twelve (12) times the amount by which (i) the monthly cost payable by you, as measured as of your Date of Termination, to obtain post-employment continued coverage under Broadcom’s employee group term life insurance and disability insurance plans at the level in effect for you on such Date of Termination exceeds (ii) the monthly amount payable at that time by a similarly-situated executive whose employment with Broadcom has not terminated to obtain similar coverage. Broadcom shall pay the Lump Sum Insurance Benefit Payment to you concurrently with the payment of the Lump Sum Health Care Benefit, provided, however, that the Lump Sum Insurance Benefit Payment shall be subject to the deferred payment provisions of Section 8 below, to the extent necessary to avoid the imposition of taxes in connection with a prohibited distribution under Section 409A(a)(2) of the Code.

Should you wish to obtain such actual post-employment continued coverage under Broadcom’s group term life insurance and disability insurance plans,

4

Broadcom shall serve as the agent for transmitting your required monthly premium payments for such coverage to the applicable insurance companies. Broadcom shall serve such agency role solely to facilitate the payment of those monthly premiums to the applicable insurance companies and shall not be responsible or liable for any loss of coverage you may incur under such plans by reason of (i) your failure to make the required monthly premium payments to Broadcom on a timely basis so as to allow their transmittal to such insurance companies by the applicable due dates (including any applicable grace periods) or (ii) the failure of the insurance companies to make such post-employment coverage available under their applicable plans.

(4)    Additional Payments. Broadcom shall, to the extent applicable, pay you the following amounts, provided you satisfy the Release Condition:

(i)     any cash bonus that was not vested on your Date of Termination because a requirement of continued employment had not yet been satisfied by you, but with respect to which the applicable performance goal or goals had been fully attained as of your Date of Termination (for the avoidance of doubt, a bonus shall be payable under this clause only to the extent that any performance criteria with respect to such bonus had been satisfied during the applicable performance period), and

(ii)     provided you were employed for the entire plan year immediately preceding your Date of Termination and discretionary bonuses are payable for that plan year to similarly-situated Broadcom executives whose employment has not terminated, any discretionary bonus the Compensation Committee may decide to award you for that plan year on the basis of your individual performance and contributions during that plan year.

Any bonus payment to which you become entitled under clause (i) of this Section 4 shall be paid to you at the same time you are paid your first Cash Severance installment under Section 1, after taking into account any required deferral under Section 8 and, provided further, that if such bonus is intended to qualify as “performance-based compensation” under Code Section 162(m), such payment shall also be subject to an appropriate present value discount reasonably reflecting the time value of money, in accordance with the Treasury Regulations under Code Section 162(m), to the extent such payment is in fact made earlier than the scheduled payment date for that bonus under the applicable Broadcom bonus plan or arrangement. Any bonus payment to which you may become entitled under clause (ii) of this Section 4 shall also be paid to you at the same time or (if later) the tenth business day following the date the Compensation Committee awards you such discretionary bonus, subject to any required deferral under Section 8.

The amounts set forth in Sections 5 and 6 below shall be referred to collectively as the “Accrued Obligations” and shall not be subject to your delivery of the Required Release or your compliance with the restrictive covenants set forth in Section 9.

(5)    Accrued Salary, Expenses and Bonus. On your Date of Termination, Broadcom shall pay you (i) any earned but unpaid base salary through that date based on

5

the rate in effect at the time the Notice of Termination is given, (ii) any unreimbursed business expenses incurred by you, and (iii) any cash bonus that had been fully earned and vested (i.e., for which the applicable performance period and any service requirements for vesting had been fully completed) on or before the Date of Termination, but which had not been paid as of the Date of Termination (for the avoidance of doubt, any such bonus shall be payable only to the extent the applicable performance criteria had been satisfied during the applicable performance period and if such bonus is intended to qualify as “performance-based compensation” under Code Section 162(m), such payment shall be subject to an appropriate present value discount reasonably reflecting the time value of money, in accordance with the Treasury Regulations under Code Section 162(m), to the extent such payment is in fact made earlier than the scheduled payment date for that bonus under the applicable Broadcom bonus plan or arrangement). However, any vested amounts deferred by you under one or more Broadcom non-qualified deferred compensation programs or arrangements subject to Section 409A that remain unpaid on your Date of Termination shall be paid at such time and in such manner as set forth in each applicable plan or agreement governing the payment of those deferred amounts, subject, however, to the deferred payment provisions of Section 8 below.

(6)    Vacation and Deferred Compensation. Broadcom shall, upon your Date of Termination, pay you an amount equal to your accrued but unpaid vacation pay, if any (based on your then-current rate of base salary). Any vested amounts deferred by you under one or more Broadcom non-qualified deferred compensation programs subject to Section 409A that remain unpaid on your Date of Termination shall be paid at such time and in such manner as set forth in each applicable plan or agreement governing the payment of those deferred amounts, subject, however, to the deferred payment provisions of Section 8 below. Any other vested amounts owed to you under any other compensation plans or programs will be paid to you in accordance with the terms and provisions of each such applicable plan or program.

(7)    Other Benefits. To the extent not theretofore paid or provided, Broadcom shall timely pay or provide to you any other amounts or benefits required to be paid or provided or that you are eligible to receive under any plan, program, policy, practice, contract, agreement, etc. of Broadcom and its affiliated companies, including (without limitation) any benefits payable to you under a plan, policy, practice, contract or agreement referred to in Section 10 of the Appendix (all such other amounts and benefits being hereinafter referred to as “Other Benefits”), in accordance with the terms of such plan, program, policy, practice, contract or agreement. However, the payment of such Other Benefits shall be subject to any applicable deferral period under Section 8 below to the extent such benefits constitute items of deferred compensation subject to Section 409A.

    Notwithstanding the foregoing provisions of this Section 7, in no event shall you be allowed to participate in the Broadcom Corporation 1998 Employee Stock Purchase Plan, as amended and restated, or the 401(k) Employee Savings Plan following your Date of Termination or to receive any substitute benefits hereunder in replacement

6

of those particular benefits, but you shall be entitled to the full value of any benefits accrued under such plans prior to your Date of Termination.

(8)    Delay in Payment for Certain Specified Employees. The following special provisions shall govern the commencement date of certain payments and benefits to which you may become entitled under the Program:

(i).    Notwithstanding any provision in this Agreement to the contrary other than Subsection (8)(ii) below, no payment or benefit under the Program that constitutes an item of deferred compensation under Section 409A and becomes payable in connection with your Separation from Service will be made to you prior to the earlier of (i) the first day of the seventh (7th) month following the date of your Separation from Service or (ii) the date of your death, if you are deemed to be a Specified Employee at the time of such Separation from Service and such delayed commencement is required to avoid a prohibited distribution under Section 409A(a)(2) of the Code. Any cash amounts to be so deferred shall immediately upon your Separation from Service be deposited by Broadcom into a grantor trust that satisfies the requirements of Revenue Procedure 92-64 and that will accordingly serve as the funding source for Broadcom to satisfy its obligations to you with respect to the heldback amounts upon the expiration of the required deferral period, provided, however, that the funds deposited into such trust shall at all times remain subject to the claims of Broadcom’s creditors and shall be maintained and located at all times in the United States. Upon the expiration of the applicable deferral period, all payments and benefits deferred pursuant to this Subsection (8)(i) (whether they would have otherwise been payable in a single sum or in installments in the absence of such deferral) shall be paid or provided to you in a lump sum, either from the grantor trust or by Broadcom directly, on the first day of the seventh (7th) month after the date of your Separation from Service or, if earlier, the first day of the month immediately following the date Broadcom receives proof of your death. Any remaining payments due under the Program will be paid in accordance with the normal payment dates specified herein.

(ii).    It is the intent of the parties that the provisions of this Agreement comply with all applicable requirements of Section 409A. Accordingly, to the extent there is any ambiguity as to whether one or more provisions of this Agreement would otherwise contravene the applicable requirements or limitations of Section 409A, then those provisions shall be interpreted and applied in a manner that does not result in a violation of the applicable requirements or limitations of Section 409A and the applicable Treasury Regulations thereunder.

(9)    Restrictive Covenants. You hereby acknowledge that your right and entitlement to the severance benefits specified in Sections (1) and (2)(ii) of this Agreement are, in addition to your satisfaction of the Release Condition, also subject to your compliance with each of the following covenants during the two (2) year period measured from your Date of Termination, and those enumerated severance benefits will

7

immediately cease or be reduced in accordance herewith should you breach any of the following covenants:

(i).     You shall not directly or indirectly encourage or solicit any employee, consultant or independent contractor to leave the employ or service of Broadcom (or any affiliated company) for any reason or interfere in any other manner with any employment or service relationships at the time existing between Broadcom (or any affiliated company) and its employees, consultants and independent contractors.

(ii).    You shall not directly or indirectly solicit or otherwise induce any vendor, supplier, licensor, licensee or other business affiliate of Broadcom (or any affiliated company) to terminate its existing business relationship with Broadcom (or affiliated company) or interfere in any other manner with any existing business relationship between Broadcom (or any affiliated company) and any such vendor, supplier, licensor, licensee or other business affiliate.

(iii).    You shall not, whether on your own or as an employee, consultant, partner, principal, agent, representative, equity holder or in any other capacity, directly or indirectly render, anywhere in the United States, services of any kind or provide any advice or assistance to any business, enterprise or other entity that is engaged in any line of business that competes with one or more of the lines of business that were conducted by Broadcom during the Term of your employment or that are first conducted after your Date of Termination but which you were aware were under serious consideration by Broadcom prior to your Date of Termination, except that you make a passive investment representing an interest of less than one percent (1%) of an outstanding class of publicly-traded securities of any corporation or other enterprise.

(iv).    You shall not, directly or indirectly, make any adverse, derogatory or disparaging statements, whether orally or in writing, to any person or entity regarding (i) Broadcom, any members of the Board of Directors (the “Board”) or any officers, members of management or shareholders of Broadcom or (ii) any practices, procedures or business operations of Broadcom (or any affiliated company).

Should you breach any of the restrictive covenants set forth in this Section 9, then you shall immediately cease to be entitled to any Cash Severance Payments pursuant to Section 1 in excess of the greater of (i) one (1) times the sum of (A) your annual rate of base salary (using your then current rate or, if you terminate your employment for Good Reason pursuant to Subsection 3(ii) of the attached Appendix due to an excessive reduction in your base salary, then your rate of base salary immediately before such reduction) and (B) the average of your actual annual bonuses for the three calendar years (or such fewer number of calendar years of employment with Broadcom) immediately preceding the calendar year in which such termination of employment occurs (which minimum amount represents partial consideration for your satisfaction of the Release Consideration) or (ii) the actual Cash Severance Payments you have received through the date of such breach. In addition, all Additional Monthly Vesting of any stock options, restricted stock units, other equity awards or unvested share issuances outstanding at the

8

time of such breach shall cease as of the month in which such breach occurs, and no further Additional Monthly Vesting shall occur thereafter. Broadcom shall also be entitled to recover at law any monetary damages for any additional economic loss caused by your breach and may, to the maximum extent allowable under applicable law, seek equitable relief in the form of an injunction precluding you from continuing such breach.

(10)     Excess Parachute Payments.

(i).    Excess Parachute Payment Limitation. Notwithstanding anything contained herein to the contrary, any payment or benefit received or to be received by you in connection with a Change of Control that would constitute a “parachute payment” (within the meaning of Code Section 280G), whether payable pursuant to the terms of this Program or any other plan, arrangements or agreement with Broadcom or its affiliates (collectively, the “Total Payments”), shall be reduced to the least extent necessary so that no portion of the Total Payments shall be subject to the excise tax imposed by Section 4999 of the Code, but only if, by reason of such reduction, your Net After-Tax Benefit as a result of such reduction will exceed the Net After-Tax Benefit that you would have received if no such reduction was made. For purposes of this Program, “Net After-Tax Benefit” means (A) the Total Payments that you become entitled to receive from the Company or its affiliates which constitute “parachute payments” (determined without regard to the requirements of Treas. Reg. Q&A-2(a)(4)), less (B) the amount of all federal, state and local income and employment taxes payable with respect to the Total Payments, calculated at the maximum applicable marginal income tax rate, less (C) the amount of excise taxes imposed with respect to the Total Payments under Section 4999 of the Code. If excise taxes may apply to the Total Payments, the foregoing determination will be made by an independent registered public accounting firm selected by Broadcom from among the largest four accounting firms in the United States (the “Accounting Firm”).

(ii).    Order of Reduction. If the Accounting Firm determines that a reduction in payments is required by this Section 10, the dollar amount of your Cash Severance under Section 1 will be reduced first, with such reduction to be effected pro-rata as to each payment, then the dollar amount of your Lump Sum Health Care and Insurance Benefit Payments shall each be reduced pro-rata, next the number of options or other equity awards that are to vest on an accelerated basis pursuant to Section 2 of this Appendix II shall be reduced (based on the value of the parachute payment resulting from such acceleration) in the same chronological order in which awarded, and finally your remaining benefits will be reduced in a manner that will not result in any impermissible deferral or acceleration of benefits under Section 409A.

(iii).    Cooperation; Expenses. If applicable, you and Broadcom will each provide the Accounting Firm access to and copies of any books, records and documents in such party’s respective possession, reasonably requested by the Accounting Firm, and otherwise cooperate with the Accounting Firm in connection with the preparation and issuance of the determinations and calculations contemplated by this

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Section 10. The fees and expenses of the Accounting Firm for its services in connection with the determinations and calculations contemplated by this Section 10 will be borne by Broadcom.

(11)     Other Terminations. If your employment is terminated during the Term for Cause or you terminate your employment during the Term without Good Reason, your participation in the Program shall terminate without any further obligations of Broadcom to you or your legal representatives under the Program, other than for timely payment of the Accrued Obligations owed you and the payment or provision of any Other Benefits to which you are entitled. However, in the event your employment is terminated during the Term by reason of your death or Disability, then Broadcom shall pay you the Accrued Obligations and

(i) Broadcom shall also pay the bonuses described in Section 4 above, if any, to you or your legal representative, with the payment under paragraph (i) of such subsection to be made within sixty (60) days after the date of your Separation from Service due to death or Disability, subject to any required holdback under Section 8 and provided further that if such bonus is intended to qualify as “performance-based compensation” under Code Section 162(m), such payment shall be subject to an appropriate present value discount reasonably reflecting the time value of money, in accordance with the Treasury Regulations under Code Section 162(m), to the extent such payment is in fact made earlier than the scheduled payment date for that bonus under the applicable Broadcom bonus plan or arrangement, and with the payment of any bonus due you under paragraph (ii) of Section 4 to be made at the same time as the foregoing payment or (if later) the tenth business day following the date the Compensation Committee awards you such discretionary bonus, subject to any required deferral under Section 8; and

(ii) notwithstanding any less favorable terms in any stock option or other equity award agreement or plan or this Program, any unvested portion of any stock options, restricted stock units or other equity awards granted to you by Broadcom, whether before or after the date of this Agreement, shall immediately vest in full on your Date of Termination and all such awards shall remain exercisable, as applicable, by you or your legal representative for 12 months after the Date of Termination (or, if earlier, until the stated expiration of such award).

The shares of Broadcom Class A common stock subject to any restricted stock unit award that vests on an accelerated basis in accordance with the foregoing shall be issued within the sixty (60) day period measured from the date of your Separation from Service due to your death or Disability, but in no event later than the next regularly-scheduled share issuance date for that restricted stock unit award date (currently, the 5th day of February, May, August and November each year) following the date of your Separation from Service, unless subject to further deferral pursuant to the provisions of Section 8 above.

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(12) Scope of Coverage. The provisions of this Agreement apply only (i) in the event of a Change of Control followed by a subsequent termination of your employment by Broadcom without Cause or by you for Good Reason within twenty-four (24) months thereafter or, with respect to the benefits set forth in Section 11 above, (ii) in the event of your death or Disability. Notwithstanding Section 10 of the Appendix, if you become entitled to receive payments under this Program, then you shall not be eligible to receive severance, termination or comparable benefits under any other plan or program of Broadcom or its affiliates, including without limitation, under the Broadcom Corporation Severance Benefit Plan for Vice Presidents and Above (or any successor plan thereto). In all other events where your employment is terminated, Broadcom’s normal severance policies will apply.

To acknowledge your continued participation in the Program pursuant to the terms and provisions of this Agreement and the attached Appendix and your understanding of its terms and conditions, please sign, date and return the enclosed copy of this Agreement.

Broadcom Corporation

By:/s/ Scott A. McGregor

Scott A. McGregor

President and Chief Executive Officer

ACCEPTANCE

I hereby accept all of the terms and conditions of the Agreement, including the revised Appendix thereto, and agree to be bound by all those terms and conditions.

/s/ Michael E. Hurlson

Michael E. Hurlston            

Dated: April 1, 2013

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APPENDIX
toCHANGE IN CONTROL SEVERANCE PROGRAM

This appendix sets forth terms and conditions of the special change in control severance benefit program (“Program”) of Broadcom Corporation (together with any successor thereto, “Broadcom”) applicable to certain key executives. This Appendix is to be construed in conjunction with, and is made a part of, the Agreement evidencing your continued participation in the Program. Eligibility for the Program is limited to executives who execute the Agreement evidencing their eligibility. Defined terms apply both to the Agreement and this Appendix.

1.    Change of Control. For purposes of the Program, a “Change of Control” shall mean a change in ownership or control of Broadcom effected through any of the following transactions:

(i)    a shareholder-approved merger, consolidation or other reorganization, unless securities representing more than fifty percent (50%) of the total combined voting power of the outstanding securities of the successor corporation are immediately after such transaction, beneficially owned, directly or indirectly and in substantially the same proportion, by the persons who beneficially owned Broadcom’s outstanding voting securities immediately prior to such transaction,

(ii)     a shareholder-approved sale, transfer or other disposition of all or substantially all of Broadcom’s assets,

(iii)    the closing of any transaction or series of related transactions pursuant to which any person or any group of persons comprising a “group” within the meaning of Rule 13d-5(b)(1) of Securities Exchange Act of 1934, as amended (the “1934 Act”), other than Broadcom or a person that, prior to such transaction or series of related transactions, directly or indirectly controls, is controlled by or is under common control with, Broadcom, becomes directly or indirectly (whether as a result of a single acquisition or by reason of one or more acquisitions within the twelve (12)-month period ending with the most recent acquisition) the beneficial owner (within the meaning of Rule 13d-3 of the 1934 Act) of securities possessing (or convertible into or exercisable for securities possessing) more than fifty percent (50%) of the total combined voting power of Broadcom’s securities (as measured in terms of the power to vote with respect to the election of Board members) outstanding immediately after the consummation of such transaction or series of related transactions, whether the transaction involves a direct issuance from Broadcom or the acquisition of outstanding securities held by one or more of Broadcom’s existing shareholders, or

(iv)    a change in the composition of the Board over a period of twenty-four (24) consecutive months or less such that a majority of the Board members ceases, by reason of one or more contested elections for Board membership, to be

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comprised of individuals who either (A) have been Board members continuously since the beginning of such period or (B) have been elected or nominated for election as Board members during such period by at least a majority of the Board members described in clause (A) who were still in office at the time the Board approved such election or nomination.

2.    Cause. Broadcom may terminate your employment with or without Cause. As used herein, “Cause” shall mean the reasonable and good faith determination by a majority of the Board that any of the following events or contingencies exists or has occurred:

(i)     You materially breached a fiduciary duty to Broadcom, materially breached a material term of the Confidentiality and Invention Assignment Agreement between you and Broadcom or materially breached any material provision or policy set forth in Broadcom’s Code of Ethics and Corporate Conduct;

(ii)     You are convicted of a felony or misdemeanor that involves fraud, dishonesty, theft, embezzlement, and/or an act of violence or moral turpitude, or plead guilty or no contest (or a similar plea) to any such felony or misdemeanor;

(iii)     You engage in any act, or there is any omission on your part, that constitutes fraud, material negligence or material misconduct in connection with your employment by Broadcom, including (but not limited to) a material violation of applicable material state or federal securities laws. Notwithstanding the foregoing, an isolated or occasional failure to file or late filing of a report required under the 1934 Act shall not be deemed a material violation for purposes of this Subsection 2(iii). Furthermore, with respect to filing reports or certifications you are required to provide under the 1934 Act, with respect to a transaction's compliance with the requirements of Rule 144 under the Securities Act of 1933, as amended or with respect to the implementation of your 10b5-1 Plan, you shall not have committed a material violation for purposes of this Subsection 2(iii) if the violation occurred because you relied in good faith on a certification or certifications provided by Broadcom or an authorized employee or agent of Broadcom, unless you knew or should have known after reasonable diligence that such certification was inaccurate, or upon the processes or actions of the securities brokerage firm handling your transactions in Broadcom equities provided that you have used a nationally recognized securities brokerage firm with substantial prior experience in and established regular procedures for handling option and equity transactions by executive officers of public companies in the United States; or;

(iv)    You willfully and knowingly participate in the preparation or release of false or materially misleading financial statements relating to Broadcom’s operations and financial condition or you willfully and knowingly submit any false or erroneous certification required of you under the Sarbanes-Oxley Act of 2002 or any securities exchange on which shares of Broadcom’s Class A common stock are at the time listed for trading.

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The foregoing shall constitute an exclusive list of the events or contingencies that may constitute Cause under the Program and this revised Appendix.

No termination that is based exclusively upon your commission or alleged commission of act(s) or omission(s) that are asserted to constitute material negligence shall constitute Cause hereunder unless you have been afforded notice of the alleged acts or omissions and have failed to cure such acts or omissions within thirty (30) days after receipt of such notice.

If, following the receipt of a Notice of Termination stating that your termination is for Cause, you believe that Cause does not exist, you may, by written notice delivered to the Board within three business (3) days after receipt of such Notice of Termination, request that your Date of Termination be delayed to permit you to appeal the Board’s determination that Cause for such termination existed. If you so request, you will be placed on administrative leave for a period determined by the Board (not to exceed 30 days), during which you will be afforded an opportunity to request that the Board reconsider its decision concerning your termination. If the Board or an appropriate committee thereof has not previously provided you with an opportunity to be heard in person concerning the reasons for termination stated in the Notice of Termination, the Board will endeavor in good faith to provide you with such an opportunity during such period of administrative leave. It is understood and agreed that any change in your employment status that occurs in connection with or as a result of such an administrative leave shall not constitute Good Reason. The Board may, as a result of such a request for reconsideration, reinstate your employment, revise the original Notice of Termination, or affirm the original Notice of Termination. If the Board affirms the original Notice of Termination or the period of administrative leave ends before the Board takes action, the Date of Termination shall be the date specified in the original Notice of Termination. If the Board reinstates your employment or revises the original Notice of Termination, then the original Notice of Termination shall be void and neither its delivery nor its contents shall be deemed to constitute Good Reason.

3.    Good Reason. You may terminate your employment for Good Reason at any time within the twenty-four (24)-month period measured from the effective date of a Change in Control that occurs during the Term. For purposes of the Program, “Good Reason” shall mean:

(i)     except as you may otherwise agree in writing, a change in your position (including status, offices, titles and reporting requirements) with Broadcom that materially reduces your authority, duties or responsibilities as in effect on the date of the Agreement, or any other action by Broadcom that results in a material diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial or inadvertent action not taken in bad faith and that is remedied by Broadcom reasonably promptly after Broadcom receives your notice thereof;

(ii)     a more than fifteen percent (15%) reduction by Broadcom in your base salary as in effect on the date of the Agreement or as the same may be increased from time-to-time during the Term;

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(iii)     any action by Broadcom (including the elimination of benefit plans without providing substitutes therefor or the reduction of your benefit thereunder) that would materially diminish the aggregate value of your bonuses and other cash

incentive awards from the levels in effect on the date of the Agreement by more than fifteen percent (15%) in the aggregate; provided, however, that (i) a reduction in your bonuses or cash incentive awards that is part of a broad-based reduction in corresponding bonuses or awards for management employees and pursuant to which your bonuses or awards s are not reduced by a greater percentage than the reductions applicable to other management employees and (ii) a reduction in your bonuses and other cash incentive awards occurring as a result of your failure or Broadcom’s failure to satisfy performance criteria applicable to such bonuses or awards shall not constitute Good Reason;

(iv)     Broadcom’s requiring you to be based at any office or other business location that increases the distance from your home to such office or location by more than fifty (50) miles from the distance in effect on the date of the Agreement;

(v)     any purported termination by Broadcom of your employment other than pursuant to a Notice of Termination (for avoidance of doubt, the delivery or contents of a Notice of Termination that is revised or voided under the procedure provided in the definition of Cause above shall not constitute Good Reason); or

(vi)     any failure by Broadcom to comply with and satisfy Section 12 of this Appendix after receipt of written notice from you of such failure and a reasonable cure period of not less than thirty (30) days.

The foregoing shall constitute an exclusive list of the events or contingencies that may constitute Good Reason under the Program and this revised Appendix.

Notwithstanding the above, an isolated or inadvertent action or inaction by Broadcom that causes Broadcom to fail to comply with Subsections 3(ii) or 3(iii) and that is cured within ten (10) days of your notifying Broadcom of such action or inaction shall not constitute Good Reason. Furthermore, no act, occurrence or condition set forth in this Section 3 shall constitute Good Reason if you consent in writing to such act, occurrence or condition, whether such consent is delivered before or after the act, occurrence or condition comes to pass.

4.    Death. Your employment shall terminate automatically upon your death.

5.    Disability. If your Disability occurs during the Term and no reasonable accommodation is available to permit you to continue to perform the essential duties and responsibilities of your position, Broadcom may give you written notice of its intention to terminate your employment. In such event, your employment with Broadcom shall terminate effective on the 30th day after you receive such notice (the “Disability Effective Date”), unless you resume the performance of your duties within thirty (30) days after receipt of such notice.

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For purposes of the Program, “Disability” shall mean your absence from and inability to perform your duties with Broadcom on a full‑time basis for one hundred eighty (180) consecutive business days as a result of incapacity due to mental or physical illness that is (i) determined to be total and permanent by two (2) physicians selected by Broadcom or its insurers and reasonably acceptable to you or your legal representative and (ii) to the extent you are eligible to participate in Broadcom’s long-term disability plan, entitles you to the payment of long-term disability benefits from Broadcom’s long-term disability plan commencing immediately on the Disability Effective Date.

6.    Notice of Termination. For purposes of the Program, a “Notice of Termination” means a written notice that (i) indicates the specific termination provision relied upon for the termination of your employment, (ii) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of your employment under the provision so indicated and (iii) if the Date of Termination (as defined below) is other than the date of receipt of such notice, specifies the termination date (with such date to be not more than thirty (30) days after the giving of such notice). The basis for termination set forth in any Notice of Termination shall constitute the exclusive set of facts and circumstances upon which the party may rely to attempt to demonstrate that Cause or Good Reason (as the case may be) for such termination existed.

7.    Date of Termination. “Date of Termination” means (i) if your employment is terminated by Broadcom or by you for any reason other than death or Disability, the date of receipt of the Notice of Termination or any later date specified therein (subject to the limitations set forth above in the definition of Notice of Termination), as the case may be, and (ii) if your employment is terminated by reason of death or Disability, the Date of Termination shall be the date of your death or the Disability Effective Date, as the case may be.

8.    Separation from Service. For purposes of the Program, “Separation from Service” means a “separation from service” from Broadcom (within the meaning of Section 409A(a)(2)(A)(i) of the Code, and Treasury Regulation Section 1.409A-1(h)).

9.     Specified Employee. For purposes of the Program, “Specified Employee” means a “specified employee” within the meaning of Code Section 409A.

10.    Non‑exclusivity of Rights. Except as provided in Section 12 of the Agreement, nothing in the Program shall prevent or limit your continuing or future participation in any plan, program, policy or practice provided by Broadcom or any of its affiliated companies during your period of employment with Broadcom and for which you may qualify, nor, subject to Section 2 of the Agreement, shall anything herein limit or otherwise affect such rights as you may have under any contract or agreement with Broadcom or any of its affiliated companies. Amounts that are vested benefits or that you are otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with Broadcom or any of its affiliated companies on or subsequent to your Date of Termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement, except as explicitly modified by the Program.

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11.    Full Settlement.

(i)    Except as specifically set forth in this Appendix or the accompanying Agreement, Broadcom’s obligation to make the payments provided for in the Program and otherwise to perform its obligations hereunder shall not be affected by any set‑off, counterclaim, recoupment, defense or other claim, right or action that Broadcom may have against you or others, except only for any advances made to you or for taxes that Broadcom is required to withhold by law. In no event shall you be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to you under any of the provisions of the Program, and such amounts shall not be reduced whether or not you obtain other employment.

(ii)    You will not become eligible to receive any of the payments and benefits provided under Sections 1, 2, 3, and 4 of the Program unless you execute and deliver to Broadcom, within twenty one (21) days after your Date of Termination (or within forty-five (45) days after such Date of Termination, to the extent such longer period is required under applicable law), a general release in a form acceptable to Broadcom (the “Required Release”) that (i) releases Broadcom and its subsidiaries, officers, directors, employees, and agents from all claims you may have relating to your employment with Broadcom and the termination of that employment, other than claims relating to any benefits to which you become entitled under the Program, and (ii) becomes effective in accordance with applicable law upon the expiration of any applicable revocation period.

12.    Successors.

(i)     The Program is personal to you and shall not be assignable by you otherwise than by will or the laws of descent and distribution. The Program shall inure to the benefit of and be enforceable by your legal representatives.

(ii)     The Program shall inure to the benefit of and be binding upon Broadcom and its successors and assigns.

(iii)     Broadcom will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of Broadcom to assume expressly and agree to perform its obligations under the Program in the same manner and to the same extent that Broadcom would be required to perform those obligations if no such succession had taken place. As used in the Program, “Broadcom” shall include any successor to its business and/or assets as aforesaid that assumes and agrees to perform the obligations created by the Program by operation of law or otherwise.

13.     Mandatory Arbitration. ANY AND ALL DISPUTES OR CONTROVERSIES BETWEEN YOU AND BROADCOM ARISING OUT OF, RELATING TO OR OTHERWISE CONNECTED WITH THE AGREEMENT OR THE BENEFITS

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PROVIDED UNDER THE PROGRAM AS SET FORTH HEREIN OR THE VALIDITY, CONSTRUCTION, PERFORMANCE OR TERMINATION OF THE AGREEMENT SHALL BE SETTLED EXCLUSIVELY BY BINDING ARBITRATION TO BE HELD IN THE COUNTY IN WHICH YOU ARE (OR HAVE MOST RECENTLY BEEN) EMPLOYED BY BROADCOM (OR ANY PARENT OR SUBSIDIARY) AT THE TIME OF SUCH ARBITRATION. THE ARBITRATION PROCEEDINGS SHALL BE GOVERNED BY (i) THE NATIONAL RULES FOR THE RESOLUTION OF EMPLOYMENT DISPUTES THEN IN EFFECT OF THE AMERICAN ARBITRATION ASSOCIATION AND (ii) THE FEDERAL ARBITRATION ACT. THE ARBITRATOR SHALL HAVE THE SAME, BUT NO GREATER, REMEDIAL AUTHORITY AS WOULD A COURT HEARING THE SAME DISPUTE. THE DECISION OF THE ARBITRATOR SHALL BE FINAL, CONCLUSIVE AND BINDING ON THE PARTIES TO THE ARBITRATION AND SHALL BE IN LIEU OF THE RIGHTS THOSE PARTIES MAY OTHERWISE HAVE TO A JURY TRIAL; PROVIDED, HOWEVER, THAT SUCH DECISION SHALL BE SUBJECT TO CORRECTION, CONFIRMATION OR VACATION IN ACCORDANCE WITH THE PROVISIONS AND STANDARDS OF APPLICABLE LAW GOVERNING THE JUDICIAL REVIEW OF ARBITRATION AWARDS. THE PREVAILING PARTY IN SUCH ARBITRATION, AS DETERMINED BY THE ARBITRATOR, AND IN ANY ENFORCEMENT OR OTHER COURT PROCEEDINGS, SHALL BE ENTITLED, TO THE EXTENT PERMITTED BY LAW, TO REIMBURSEMENT FROM THE OTHER PARTY FOR ALL OF THE PREVAILING PARTY’S COSTS, INCLUDING, BUT NOT LIMITED TO, EXPENSES AND REASONABLE ATTORNEY’S FEES. HOWEVER, THE ARBITRATOR’S COMPENSATION AND OTHER FEES AND COSTS UNIQUE TO ARBITRATION SHALL IN ALL EVENTS BE PAID BY BROADCOM. JUDGMENT SHALL BE ENTERED ON THE ARBITRATOR’S DECISION IN ANY COURT HAVING JURISDICTION OVER THE SUBJECT MATTER OF SUCH DISPUTE OR CONTROVERSY. NOTWITHSTANDING THE FOREGOING, EITHER PARTY MAY IN AN APPROPRIATE MATTER APPLY TO A COURT PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 1281.8, OR ANY COMPARABLE STATUTORY PROVISION OR COMMON LAW PRINCIPLE, FOR PROVISIONAL RELIEF, INCLUDING A TEMPORARY RESTRAINING ORDER OR A PRELIMINARY INJUNCTION. TO THE EXTENT PERMITTED BY LAW, THE PROCEEDINGS AND RESULTS, INCLUDING THE ARBITRATOR’S DECISION, SHALL BE KEPT CONFIDENTIAL.

14.    Governing Law. The laws of California shall govern the validity and interpretation of the Program, without resort to that State’s rules governing conflicts of laws.

15.    Captions. The captions of this Appendix are not part of the provisions of the Program and shall have no force or effect.

16.    Amendment. The Program may not be amended or modified with respect to you other than by a written agreement executed by you and Broadcom or your and its respective successors and legal representatives.

17.    Notices. All notices and other communications under the Agreement shall be in writing and shall be given by hand delivery to the other party, by overnight courier or by

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registered or certified mail, return receipt requested, postage prepaid, addressed (if to you) at the address you last provided in writing to Broadcom, and if to Broadcom, as follows:

Broadcom Corporation

5300 California Avenue

Irvine, California 92617

Attention: Chief Executive Officer

Notice and communications shall be effective when actually received by the addressee. Neither your failure to give any notice required by the Program, nor defects or errors in any notice given by you, shall relieve Broadcom of any corresponding obligation under the Program unless, and only to the extent that, Broadcom is actually and materially prejudiced thereby.

18.    Severability. If any provision of the Agreement or this revised Appendix as applied to any party or to any circumstance should be adjudged by a court of competent jurisdiction or determined by an arbitrator to be void or unenforceable for any reason, the invalidity of that provision shall in no way affect (to the maximum extent permissible by law) the application of such provision under circumstances different from those adjudicated by the court or determined by the arbitrator, the application of any other provision of the Agreement or this revised Appendix, or the enforceability or invalidity of the Agreement or revised Appendix as a whole. Should any provision of the Agreement or the revised Appendix become or be deemed invalid, illegal or unenforceable in any jurisdiction by reason of the scope, extent or duration of its coverage, then such provision shall be deemed amended to the extent necessary to conform to applicable law so as to be valid and enforceable or, if such provision cannot be so amended without materially altering the intention of the parties, then such provision will be stricken, and the remainder of the Agreement or the revised Appendix, as the case may be, shall continue in full force and effect.

19.    Withholding Taxes. Broadcom shall withhold from any amounts payable under the Program all Federal, state, local or foreign taxes required to be withheld pursuant to any applicable law or regulation.

20.    No Waiver. Your failure or Broadcom’s failure to insist upon strict compliance with any provision hereof or any other provision of the Program or the failure to assert any right you or Broadcom may have hereunder, including, without limitation, your right to terminate employment for Good Reason, shall not be deemed to be a waiver of the application of such provision or right with respect to any subsequent event or the waiver of any other provision or right of the Program.

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EX-31.1

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Scott A. McGregor, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Broadcom Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ SCOTT A. MCGREGOR

Scott A. McGregor

President and Chief Executive Officer

(Principal Executive Officer)

Date: April 23, 2013

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Eric K. Brandt, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Broadcom Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ ERIC K. BRANDT

Eric K. Brandt

Executive Vice President and

Chief Financial Officer

(Principal Financial Officer)

Date: April 23, 2013

EX-32

EXHIBIT 32

The following certifications are being furnished solely to accompany the Report pursuant to 18 U.S.C. § 1350, and pursuant to SEC Release No. 33-8238 are being “furnished” to the SEC rather than “filed” either as part of the Report or as a separate disclosure statement, and are not to be incorporated by reference into the Report or any other filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing. The foregoing certifications shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of Section 18 or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.

Certification of Chief Executive Officer

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Broadcom Corporation (the “Company”) hereby certifies, to such officer’s knowledge, that:

(i)the accompanying Quarterly Report on Form 10-Q of the Company for the quarterly period ended March 31, 2013 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and

(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/S/ SCOTT A. MCGREGOR

Scott A. McGregor

Chief Executive Officer

Date: April 23, 2013

Certification of Chief Financial Officer

Pursuant to 18 U.S.C. § 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of Broadcom Corporation (the “Company”) hereby certifies, to such officer’s knowledge, that:

(i)the accompanying Quarterly Report on Form 10-Q of the Company for the quarterly period ended March 31, 2013 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and

(ii)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/S/ ERIC K. BRANDT

Eric K. Brandt

Chief Financial Officer

Date: April 23, 2013

XML

Commitments and Contingencies Related to Litigation (Details)	1 Months Ended	3 Months Ended	42 Months Ended
	Sep. 30, 2009 patent	Mar. 31, 2013 patent	Mar. 31, 2013 patent
Commitments and Contingencies Disclosure [Abstract]
Number of patents in connection with patent infringement matters	10	6
Number of additional patents in connection with patent infringement matters			2
Number of withdrawn patents in connection with patent infringement matters			6

XML

Business Enterprise Segments, Significant Customer and Geographical Information (Details 2)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Percentage of product revenue
Percentage of product revenue	100.00%	100.00%
China (exclusive of Hong Kong) [Member]
Percentage of product revenue
Percentage of product revenue	21.80%	30.00%
Hong Kong [Member]
Percentage of product revenue
Percentage of product revenue	25.20%	25.90%
Singapore, Taiwan, Thailand and Japan [Member]
Percentage of product revenue
Percentage of product revenue	39.70%	31.50%
United States [Member]
Percentage of product revenue
Percentage of product revenue	3.00%	3.60%
Europe [Member]
Percentage of product revenue
Percentage of product revenue	1.70%	1.20%
Other [Member]
Percentage of product revenue
Percentage of product revenue	8.60%	7.80%

XML

Business Enterprise Segments, Significant Customer and Geographical Information (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Details of reportable segments
Net revenue	$ 2,005	$ 1,827
Operating income (loss)	198	50
Broadband Communications [Member]
Details of reportable segments
Net revenue	537	494
Operating income (loss)	124	104
Mobile and Wireless [Member]
Details of reportable segments
Net revenue	996	875
Operating income (loss)	123	124
Infrastructure and Networking [Member]
Details of reportable segments
Net revenue	429	406
Operating income (loss)	98	107
All Other [Member]
Details of reportable segments
Net revenue	43	52
Operating income (loss)	$ (147)	$ (285)

XML

Debt and Credit Facility (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Dec. 31, 2012
Summary of debt
Total	$ 1,700
Unaccreted discount	(6)
Less current portion of long-term debt	(300)	(300)
Total	1,394	1,393
Leverage ratio	3.25
Interest cover ratio	300.00%
1.500% Fixed Rate Notes Due 2013 [Member]
Summary of debt
Total	300
Fixed interest rate on senior note	1.50%
2.375% Fixed Rate Notes Due 2015 [Member]
Summary of debt
Total	400
Fixed interest rate on senior note	2.375%
2.700% Fixed Rate Notes Due 2018 [Member]
Summary of debt
Total	500
Fixed interest rate on senior note	2.70%
2.500% Fixed Rate Notes Due 2022 [Member]
Summary of debt
Total	$ 500
Fixed interest rate on senior note	2.50%

XML

Supplemental Financial Information (Details 1) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Inventory
Work in process	$ 205	$ 187
Finished goods	318	340
Inventory, net	$ 523	$ 527

XML

Goodwill and Other Purchased Intangible Assets (Details Textual) (USD $) In Millions, unless otherwise specified	3 Months Ended			3 Months Ended			1 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Oct. 01, 2012	Mar. 31, 2013 Minimum [Member]	Mar. 31, 2013 Maximum [Member]	Mar. 31, 2013 Net Logic [Member] Developed Technology Rights [Member]	Mar. 31, 2013 Provigent [Member]	Mar. 31, 2012 Dune Networks [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Excess fair value over carrying value			19.00%
Reclassified intangible assets						$ 80
Impairments of long-lived assets	$ 10	$ 28					$ 10	$ 28
Fair value measurements, valuation processes, description	multiple period excess earnings method
Fair value inputs, discount rate				14.00%	25.00%
Tax rate	15.00%

XML

Employee Benefit Plans (Details 1) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2013
Activity under stock option incentive plans
Balance at December 31, 2012, Number of Shares	58
Options cancelled, Number of Shares	0
Options exercised, Number of Shares	(4)
Balance at March 31, 2013, Number of Shares	54
Stock option activity, Weighted average exercise price per share
Balance at December 31, 2012, Weighted Average Exercise Price per Share (usd per share)	$ 28.11
Options cancelled, Weighted Average Exercise Price per Share (usd per share)	$ 40.47
Options exercised, Weigthed Average Exercise Price per Share (usd per share)	$ 22.15
Balance at March 31, 2013, Weighted Average Exercise Price per Share (usd per share)	$ 28.42
Share-based Compensation Arrangement By Share-based Payment Award, Options, Weighted Average Grant Date Fair Value [Roll Forward]
Balance at December 31, 2012, Weighted Average Grant-Date Fair Value per Share (usd per share)	$ 14.95
Options cancelled, Weighted Average Grant-Date Fair Value per Share (usd per share)	$ 12.64
Options Exercised, Weighted Average Grant-Date Fair Value per Share (usd per share)	$ 23.46
Balance at March 31, 2013, Weighted Average Grant-Date Fair Value per Share (usd per share)	$ 14.46

XML

Business Enterprise Segments, Significant Customer and Geographical Information (Details 1) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Segment Reporting Information [Line Items]
Net revenue	$ 2,005	$ 1,827
Stock-based compensation	140	150
Amortization of purchased intangible assets	15	17
Impairments of long-lived assets	10	28
Settlement costs	0	86
Restructuring costs, net	0	3
Income from operations	198	50
All Other Segments [Member]
Segment Reporting Information [Line Items]
Net revenue	43	52
Stock-based compensation	140	150
Amortization of purchased intangible assets	58	54
Amortization of acquired inventory valuation step-up	1	22
Impairments of long-lived assets	10	28
Settlement costs	0	86
Restructuring costs, net	0	3
Employer payroll tax on certain stock option exercises	2	2
Miscellaneous corporate allocation variances	(21)	(8)
Total other operating costs and expenses	190	337
Income from operations	$ (147)	$ (285)

XML

Supplemental Financial Information

3 Months Ended

Mar. 31, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Supplemental Financial Information

Supplemental Financial Information

Inventory

The following table presents details of our inventory:

	March 31, 2013		December 31, 2012
	(In millions)
Work in process	$	205	$	187
Finished goods	318		340
	$	523	$	527

Accrued Liabilities

The following table presents details of our accrued liabilities included in current liabilities:

	March 31, 2013		December 31, 2012
	(In millions)
Accrued rebates	$	319	$	383
Accrued royalties	16		21
Accrued settlement charges	70		68
Accrued legal costs	17		15
Accrued taxes	19		16
Warranty reserve	11		13
Other	69		54
	$	521	$	570

Other Long-Term Liabilities

The following table presents details of our other long-term liabilities:

	March 31, 2013		December 31, 2012
	(In millions)
Deferred rent	$	52	$	54
Accrued taxes	82		67
Deferred tax liabilities	42		45
Accrued settlement charges	58		58
Deferred revenue	44		47
Other long-term liabilities	21		23
	$	299	$	294

Accrued Rebate Activity

The following table summarizes the activity related to accrued rebates:

	Three Months Ended
	March 31,
	2013			2012
	(In millions)
Beginning balance	$	383		$	317
Charged as a reduction of revenue	161			147
Reversal of unclaimed rebates	(6		)	(3		)
Payments	(219		)	(159		)
Ending balance	$	319		$	302

Computation of Net Income Per Share

Net income per share (basic) is calculated by dividing net income by the weighted average number of common shares outstanding during the year. Net income per share (diluted) is calculated by adjusting outstanding shares, assuming any dilutive effects of stock options and restricted stock units calculated using the treasury stock method. Under the treasury stock method, an increase in the fair market value of our Class A common stock results in a greater dilutive effect from outstanding stock options, stock purchase rights and restricted stock units. Additionally, the exercise of employee stock options and stock purchase rights and the vesting of restricted stock units results in a further dilutive effect on net income per share.

The following table presents the computation of net income per share:

	Three Months Ended
	March 31,
	2013		2012
	(In millions, except per share data)
Numerator: Net income	$	191	$	88
Denominator for net income per share (basic)	570		548
Effect of dilutive securities:
Stock awards	15		22
Denominator for net income per share (diluted)	585		570
Net income per share (basic)	$	0.34	$	0.16
Net income per share (diluted)	$	0.33	$	0.15

Net income per share (diluted) does not include the effect of anti-dilutive common share equivalents resulting from outstanding equity awards. There were 21 million and 27 million anti-dilutive common share equivalents in the three months ended March 31, 2013 and 2012, respectively.

Income from the Qualcomm Agreement

For a discussion of income from our April 2009 agreement with Qualcomm Incorporated, or the Qualcomm Agreement, please see our 2012 Annual Report. The income from the Qualcomm Agreement is non-recurring and will terminate in April 2013.

Supplemental Cash Flow Information

In the three months ended March 31, 2013 we accrued $1 million related to stock option exercises that had not settled by March 31, 2013. In the three months ended March 31, 2013, we paid $27 million for capital equipment that was accrued as of December 31, 2012 and had billings of $30 million for capital equipment that were accrued but not yet paid as of March 31, 2013.

XML

Goodwill and Other Purchased Intangible Assets (Details 1) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Finite-Lived Intangible Assets [Line Items]
Gross	$ 2,484	$ 2,496
Accumulated Amortization	(746)	(690)
Before effects of foreign currency translation	1,738	1,806
Effects of foreign currency translation	(16)	(20)
Purchased intangible assets, Net	1,722	1,786
Developed Technology Rights [Member]
Finite-Lived Intangible Assets [Line Items]
Gross	1,837	1,760
Accumulated Amortization	(483)	(441)
Purchased intangible assets, Net	1,354	1,319
In Process Research And Development [Member]
Finite-Lived Intangible Assets [Line Items]
Gross	226	315
Accumulated Amortization	0	0
Purchased intangible assets, Net	226	315
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross	385	385
Accumulated Amortization	(238)	(224)
Purchased intangible assets, Net	147	161
Other Intangible Assets [Member]
Finite-Lived Intangible Assets [Line Items]
Gross	36	36
Accumulated Amortization	(25)	(25)
Purchased intangible assets, Net	$ 11	$ 11

XML

Supplemental Financial Information (Details Textual) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Anti-dilutive common share equivalents (shares)	21	27
Accrued related to unsettled stock option exercises	$ 1
Payments related to capital equipment purchase	27
Capital equipment that were accrued but not yet paid	$ 30

XML

Supplemental Financial Information (Details 4) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Earnings Per Share [Abstract]
Numerator: Net income	$ 191	$ 88
Denominator for net income per share (basic) (shares)	570	548
Effect of dilutive securities:
Stock awards (shares)	15	22
Denominator for net income per share (diluted) (shares)	585	570
Net income per share (basic) (usd per share)	$ 0.34	$ 0.16
Net income per share (diluted) (usd per share)	$ 0.33	$ 0.15

XML

Goodwill and Other Purchased Intangible Assets (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Goodwill [Line Items]
Amortization of purchased intangible assets	$ 15	$ 17
Cost of product revenue [Member]
Goodwill [Line Items]
Amortization of purchased intangible assets	43	37
Other operating expense [Member]
Goodwill [Line Items]
Amortization of purchased intangible assets	15	17
All Other Segments [Member]
Goodwill [Line Items]
Amortization of purchased intangible assets	$ 58	$ 54

XML

Fair Value Measurements (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2012	Dec. 31, 2011
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Gross Unrealized Losses	$ (1)
Cash and cash equivalents	1,742	1,617	1,325	4,146
Short-Term Marketable Securities	727	757
Long-Term Marketable Securities	1,457	1,348
Level 1 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	2,324	2,091
Gross Unrealized Gains	1	1
Gross Unrealized Losses	0	0
Fair Value	2,325	2,092
Cash and cash equivalents	1,446	1,134
Short-Term Marketable Securities	197	222
Long-Term Marketable Securities	682	736
Level 2 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	1,378	1,416
Gross Unrealized Gains	2	2
Gross Unrealized Losses	0	(1)
Fair Value	1,380	1,417
Cash and cash equivalents	75	270
Short-Term Marketable Securities	530	535
Long-Term Marketable Securities	775	612
Estimate of Fair Value, Fair Value Disclosure [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	3,923	3,720
Gross Unrealized Gains	3	3
Gross Unrealized Losses	0	(1)
Fair Value	3,926	3,722
Cash and cash equivalents	1,742	1,617
Short-Term Marketable Securities	727	757
Long-Term Marketable Securities	1,457	1,348
Cash [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	221	213
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	221	213
Cash and cash equivalents	221	213
Short-Term Marketable Securities	0	0
Long-Term Marketable Securities	0	0
Bank and time deposits [Member] | Level 1 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	1,173	904
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	1,173	904
Cash and cash equivalents	1,143	884
Short-Term Marketable Securities	20	20
Long-Term Marketable Securities	10	0
Money market funds [Member] | Level 1 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	300	250
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	300	250
Cash and cash equivalents	300	250
Short-Term Marketable Securities	0	0
Long-Term Marketable Securities	0	0
U.S. treasury and agency obligations [Member] | Level 1 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	850	936
Gross Unrealized Gains	1	1
Gross Unrealized Losses	0	0
Fair Value	851	937
Cash and cash equivalents	3	0
Short-Term Marketable Securities	176	201
Long-Term Marketable Securities	672	736
Corporate bonds [Member] | Level 1 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	1	1
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	1	1
Cash and cash equivalents	0	0
Short-Term Marketable Securities	1	1
Long-Term Marketable Securities	0	0
Corporate bonds [Member] | Level 2 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	1,140	921
Gross Unrealized Gains	2	2
Gross Unrealized Losses	0	(1)
Fair Value	1,142	922
Cash and cash equivalents	26	0
Short-Term Marketable Securities	374	351
Long-Term Marketable Securities	742	571
Commercial Paper [Member] | Level 2 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	182	432
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	182	432
Cash and cash equivalents	49	270
Short-Term Marketable Securities	133	162
Long-Term Marketable Securities	0	0
Asset-backed securities and other [Member] | Level 2 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	56	63
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	56	63
Cash and cash equivalents	0	0
Short-Term Marketable Securities	23	22
Long-Term Marketable Securities	33	41
None [Member] | Level 3 [Member]
Schedule of Investment Income, Reported Amounts, by Category [Line Items]
Cost	0	0
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	0	0
Cash and cash equivalents	0	0
Short-Term Marketable Securities	0	0
Long-Term Marketable Securities	$ 0	$ 0

XML

Fair Value Measurements (Details Textual) (USD $)	3 Months Ended
	Mar. 31, 2013 investment	Dec. 31, 2012
Fair Value Disclosures [Abstract]
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount	$ 0
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers, Net	0
Available for Sale Debt maturities min date	1 year
Available for sale securities max maturity	3 years
Cash, cash equivalents and short term investments held domestically	2,370,000,000
Cash, cash equivalents and short-term investments held by our foreign subsidiaries	1,560,000,000
Number of investments in unrealized loss position	85
Fair market value of investments	527,000,000
Period for unrealized loss position	less than 12 months
Gross unrealized losses on available-for-sale securities	1,000,000
Fair Value Measurements, Valuation Techniques	based primarily on quoted market prices for the same or similar issues
Fair value of long term debt	$ 1,740,000,000	$ 1,750,000,000

XML

Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2013

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Our Company

Broadcom Corporation (including our subsidiaries, referred to collectively in this Report as “Broadcom,” “we,” “our” and “us”) is a global leader and innovator in semiconductor solutions for wired and wireless communications. Broadcom^® products seamlessly deliver voice, video, data and multimedia connectivity in the home, office and mobile environments. We provide the industry’s broadest portfolio of state-of-the-art system-on-a-chip, or SoC, and embedded software solutions.

Basis of Presentation

The interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, for interim financial information and with the instructions to Securities and Exchange Commission, or SEC, Form 10-Q and Article 10 of SEC Regulation S-X. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto for the year ended December 31, 2012, included in our 2012 Annual Report on Form 10-K filed with the SEC on January 30, 2013, referred to as our 2012 Annual Report.

The interim condensed consolidated financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly our results of operations and financial position for the interim periods. The results of operations for the three months ended March 31, 2013 are not necessarily indicative of the results to be expected for future quarters or the full year.

For a complete summary of our significant accounting policies, please refer to Note 1, "Summary of Significant Accounting Policies", in Part IV, Item 15 of our 2012 Annual Report. There have been no material changes to our significant accounting policies during the three months ended March 31, 2013.

Use of Estimates

The preparation of financial statements in accordance with United States generally accepted accounting principles, or GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the financial statements and the reported amounts of total net revenue and expenses in the reporting periods. We regularly evaluate estimates and assumptions related to revenue recognition, rebates, allowances for doubtful accounts, sales returns and allowances, warranty obligations, inventory valuation, stock-based compensation expense, goodwill and purchased intangible asset valuations, strategic investments, deferred income tax asset valuation allowances, uncertain tax positions, tax contingencies, self-insurance, restructuring costs or reversals, litigation and other loss contingencies. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. The actual results we experience may differ materially and adversely from our estimates. To the extent there are material differences between the estimates and actual results, our future results of operations will be affected.

XML

Income Taxes (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Dec. 31, 2012
Income Tax Disclosure [Abstract]
Provision (benefit) for income taxes	$ 2	$ (45)
Effective tax rates	1.00%	(104.70%)
Federal statutory income tax rate	35.00%	35.00%
Income Tax Reconciliation, Change in Deferred Tax Assets Valuation Allowance		46
Net deferred tax liabilities	$ 26		$ 29

XML

Commitments and Contingencies Settlement Costs (Gains) and Other Related Costs (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Commitments and Contingencies Disclosure [Abstract]
Gains/(Loss) related to litigation settlement	$ 0	$ (86)
Additional possible loss	$ 20

XML

Unaudited Condensed Consolidated Balance Sheets (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 1,742	$ 1,617
Short-term marketable securities	727	757
Accounts receivable, net	751	740
Inventory	523	527
Prepaid expenses and other current assets	154	140
Total current assets	3,897	3,781
Property and equipment, net	493	485
Long-term marketable securities	1,457	1,348
Goodwill	3,729	3,726
Purchased intangible assets, net	1,722	1,786
Other assets	102	82
Total assets	11,400	11,208
Current liabilities:
Current portion of long-term debt	300	300
Accounts payable	661	549
Wages and related benefits	170	241
Deferred revenue and income	23	22
Accrued liabilities	521	570
Total current liabilities	1,675	1,682
Long-term debt	1,394	1,393
Other long-term liabilities	299	294
Commitments and contingencies
Shareholders' equity:
Common stock	0	0
Additional paid-in capital	12,402	12,403
Accumulated deficit	(4,340)	(4,531)
Accumulated other comprehensive loss	(30)	(33)
Total shareholders' equity	8,032	7,839
Total liabilities and shareholders' equity	$ 11,400	$ 11,208

XML

Goodwill and Other Purchased Intangible Assets (Details 3) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Goodwill [Line Items]
Purchased Intangible Asset Amortization, 2013	$ 175
Purchased Intangible Asset Amortization, 2014	282
Purchased Intangible Asset Amortization, 2015	248
Purchased Intangible Asset Amortization, 2016	208
Purchased Intangible Asset Amortization, 2017	189
Purchased Intangible Asset Amortization, Thereafter	620
Purchased intangible assets, Net	1,722	1,786
Cost of product revenue [Member]
Goodwill [Line Items]
Purchased Intangible Asset Amortization, 2013	132
Purchased Intangible Asset Amortization, 2014	218
Purchased Intangible Asset Amortization, 2015	216
Purchased Intangible Asset Amortization, 2016	199
Purchased Intangible Asset Amortization, 2017	186
Purchased Intangible Asset Amortization, Thereafter	615
Purchased intangible assets, Net	1,566
Other operating expense [Member]
Goodwill [Line Items]
Purchased Intangible Asset Amortization, 2013	43
Purchased Intangible Asset Amortization, 2014	64
Purchased Intangible Asset Amortization, 2015	32
Purchased Intangible Asset Amortization, 2016	9
Purchased Intangible Asset Amortization, 2017	3
Purchased Intangible Asset Amortization, Thereafter	5
Purchased intangible assets, Net	$ 156

XML

Unaudited Condensed Consolidated Statements of Comprehensive Income (Parenthetical) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Statement of Other Comprehensive Income [Abstract]
Foreign currency translation adjustments, tax	$ 0	$ 0
Unrealized gains (losses) on marketable securities, tax	$ 0	$ 0

XML

Shareholders' Equity (Details) (USD $) In Millions, except Per Share data, unless otherwise specified	1 Months Ended	3 Months Ended		12 Months Ended
	Jan. 31, 2013	Mar. 31, 2013	Mar. 31, 2012	Dec. 31, 2013
Equity [Abstract]
Percentage increase in cash dividend	10.00%
Dividend declared per share (usd per share)	$ 0.11			$ 0.44
Dividends paid		$ (63)	$ (55)
Stock repurchased during period (shares)		3.2
Weighted average repurchase price (usd per share)		$ 33.42

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Employee Benefit Plans (Tables)

3 Months Ended

Mar. 31, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Restricted stock unit activity

Restricted stock unit activity is set forth below:

	Restricted Stock Units Outstanding
	Number of Shares		Weighted Average Grant-Date Fair Value per Share
	(In millions, except per share data)
Balance at December 31, 2012	25		$	35.55
Restricted stock units granted	12		33.81
Restricted stock units cancelled	—		35.05
Restricted stock units vested	(4	)	33.06
Balance at March 31, 2013	33		$	35.19

Activity under all stock option incentive plans

Stock option activity is set forth below:

	Options Outstanding
	Number of Shares		Weighted Average Exercise Price per Share		Weighted Average Grant-Date Fair Value per Share
	(In millions, except per share data)
Balance at December 31, 2012	58		$	28.11	$	14.95
Options cancelled	—		40.47		12.64
Options exercised	(4	)	22.15		23.46
Balance at March 31, 2013	54		$	28.42	$	14.46

Unearned stock-based compensation estimated to be expensed related to unvested share-based payment awards

The following table presents details of unearned stock-based compensation currently estimated to be expensed in the remainder of 2013 through 2017 related to unvested share-based payment awards:

	2013		2014		2015		2016		2017		Total
	(In millions)
Unearned stock-based compensation	$	384	$	373	$	233	$	119	$	15	$	1,124

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Employee Benefit Plans (Details) (Restricted Stock [Member], USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2013
Restricted Stock [Member]
Restricted stock unit activity, Number of shares
Balance at December 31, 2012, Number of Shares	25
Restricted stock units granted, Number of Shares	12
Restricted stock units cancelled, Number of Shares	0
Restricted stock units vested, Number of Shares	(4)
Balance at March 31, 2013, Number of Shares	33
Restricted stock unit activity, Weighted average grant-date fair value per share
Balance at December 31, 2012, Weighted Average Grant-Date Fair Value per Share (usd per share)	$ 35.55
Restricted stock units granted, Weighted Average Grant Date Fair Value (usd per share)	$ 33.81
Restricted stock units cancelled, Weighted Average Grant-date Fair Value per Share (usd per share)	$ 35.05
Restricted stock units vested, Weighted Average Grant-Date Fair Value per Share (usd per share)	$ 33.06
Balance at March 31, 2013, Weighted Average Grant-Date Fair Value per Share (usd per share)	$ 35.19

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Business Enterprise Segments, Significant Customer and Geographical Information (Tables)

3 Months Ended

Mar. 31, 2013

Segment Reporting [Abstract]

Reportable segments and the All Other category

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

	Reportable Segments
	Broadband Communications		Mobile and Wireless		Infrastructure and Networking		All Other			Consolidated
	(In millions)
Three Months Ended March 31, 2013
Net revenue	$	537	$	996	$	429	$	43		$	2,005
Operating income (loss)	124		123		98		(147		)	198
Three Months Ended March 31, 2012
Net revenue	$	494	$	875	$	406	$	52		$	1,827
Operating income (loss)	104		124		107		(285		)	50

All other category included

Included in the “All Other” category:

	Three Months Ended
	March 31,
	2013			2012
	(In millions)
Net revenue	$	43		$	52
Stock-based compensation	$	140		$	150
Amortization of purchased intangible assets	58			54
Amortization of acquired inventory valuation step-up	1			22
Impairments of long-lived assets	10			28
Settlement costs	—			86
Restructuring costs, net	—			3
Employer payroll tax on certain stock option exercises	2			2
Miscellaneous corporate allocation variances	(21		)	(8		)
Total other operating costs and expenses	$	190		$	337
Total operating loss for the “All Other” category	$	(147	)	$	(285	)

Percentage of product revenue from shipments by geographic region

The geographical distribution of our shipments, as a percentage of product revenue was as follows:

	Three Months Ended
	March 31,
	2013		2012
China (exclusive of Hong Kong)	21.8	%	30.0	%
Hong Kong	25.2		25.9
Singapore, Taiwan, Thailand and Japan	39.7		31.5
United States	3.0		3.6
Europe	1.7		1.2
Other	8.6		7.8
	100.0	%	100.0	%

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Unaudited Condensed Consolidated Statements of Cash Flows (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Operating activities
Net income	$ 191	$ 88
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	39	28
Stock-based compensation expense	140	150
Acquisition-related items:
Amortization of purchased intangible assets	58	54
Impairments of long-lived assets	10	28
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	(11)	(51)
Inventory	4	38
Prepaid expenses and other assets	(34)	(11)
Accounts payable	109	52
Deferred revenue and income	(2)	(9)
Accrued settlement costs	(3)	87
Other accrued and long-term liabilities	(113)	(86)
Net cash provided by operating activities	388	368
Investing activities
Net purchases of property and equipment	(41)	(74)
Net cash paid for acquired companies	0	(3,393)
Purchases of marketable securities	(619)	(334)
Proceeds from sales and maturities of marketable securities	539	706
Net cash used in investing activities	(121)	(3,095)
Financing activities
Repurchases of Class A common stock	(107)	0
Dividends paid	(63)	(55)
Payment of assumed contingent consideration	0	(53)
Proceeds from issuance of common stock	68	62
Minimum tax withholding paid on behalf of employees for restricted stock units	(40)	(48)
Net cash used in financing activities	(142)	(94)
Increase (decrease) in cash and cash equivalents	125	(2,821)
Cash and cash equivalents at beginning of period	1,617	4,146
Cash and cash equivalents at end of period	$ 1,742	$ 1,325

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Unaudited Condensed Consolidated Statements of Income (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Net revenue:
Product revenue	$ 1,954	$ 1,770
Income from Qualcomm Agreement	43	52
Licensing revenue	8	5
Total net revenue	2,005	1,827
Costs and expenses:
Cost of product revenue	988	918
Research and development	615	546
Selling, general and administrative	179	179
Amortization of purchased intangible assets	15	17
Impairments of long-lived assets	10	28
Restructuring costs, net	0	3
Settlement costs	0	86
Total operating costs and expenses	1,807	1,777
Income from operations	198	50
Interest expense, net	(8)	(6)
Other income (expense), net	3	(1)
Income before income taxes	193	43
Provision for (benefit of) income taxes	2	(45)
Net income	$ 191	$ 88
Net income per share (basic) (usd per share)	$ 0.34	$ 0.16
Net income per share (diluted) (usd per share)	$ 0.33	$ 0.15
Weighted average shares (basic) (shares)	570	548
Weighted average shares (diluted) (shares)	585	570
Dividends per share (usd per share)	$ 0.11	$ 0.1

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Business Enterprise Segments, Significant Customer and Geographical Information

3 Months Ended

Mar. 31, 2013

Segment Reporting [Abstract]

Business Enterprise Segments, Significant Customer and Geographical Information

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 and Wireless (Hand) and Infrastructure and Networking (Infrastructure). Our Chief Executive Officer, who is our chief operating decision maker, or CODM, reviews financial information at the reportable segment level.

Our net revenue is generated principally from sales of integrated circuit products, the income we receive from the Qualcomm Agreement and other licensing revenue. While we derive some revenue from other sources, that revenue is not material as it represents approximately 1% of our total net revenue. Such revenue is classified under product revenue for reporting purposes. We group our net revenue consistent with our three target markets which comprise our reportable segments, as discussed above.

With respect to the sales of integrated circuit products, we have approximately 600 products that are grouped into approximately 60 product lines. We have concluded that these products constitute a group of similar products within each reportable segment in each of the following respects:

• the integrated circuits marketed by each of our reportable segments are sold to one type of customer: manufacturers of wired and wireless communications equipment, which incorporate our integrated circuits into their electronic products;

• the integrated circuits sold by each of our reportable segments use the same standard CMOS manufacturing processes; and

• all of our integrated circuits are sold through a centralized sales force and common wholesale distributors.

We also report an “All Other” category that is comprised of (i) income from the Qualcomm Agreement and (ii) other licensing revenue, 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, amortization of acquired inventory valuation step-up, impairment of goodwill and other long-lived assets, net settlement costs (gains), net restructuring costs, charitable contributions, non-recurring legal fees, change in contingent earnout liability, 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. 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 Communications		Mobile and Wireless		Infrastructure and Networking		All Other			Consolidated
	(In millions)
Three Months Ended March 31, 2013
Net revenue	$	537	$	996	$	429	$	43		$	2,005
Operating income (loss)	124		123		98		(147		)	198
Three Months Ended March 31, 2012
Net revenue	$	494	$	875	$	406	$	52		$	1,827
Operating income (loss)	104		124		107		(285		)	50

Included in the “All Other” category:

	Three Months Ended
	March 31,
	2013			2012
	(In millions)
Net revenue	$	43		$	52
Stock-based compensation	$	140		$	150
Amortization of purchased intangible assets	58			54
Amortization of acquired inventory valuation step-up	1			22
Impairments of long-lived assets	10			28
Settlement costs	—			86
Restructuring costs, net	—			3
Employer payroll tax on certain stock option exercises	2			2
Miscellaneous corporate allocation variances	(21		)	(8		)
Total other operating costs and expenses	$	190		$	337
Total operating loss for the “All Other” category	$	(147	)	$	(285	)

Significant Customer and Geographical Information

We derive a substantial portion of our revenue from sales to a relatively small number of customers. Sales to our five largest customers, including their manufacturing subcontractors represented 51.4% and 49.2% of our total net revenue in the three months ended March 31, 2013 and 2012, respectively. Sales to two significant customers, those representing 10% or more of total net revenue, represented 36.8% and 31.3% of our total net revenue in the three months ended March 31, 2013 and 2012, respectively.

The geographical distribution of our shipments, as a percentage of product revenue was as follows:

	Three Months Ended
	March 31,
	2013		2012
China (exclusive of Hong Kong)	21.8	%	30.0	%
Hong Kong	25.2		25.9
Singapore, Taiwan, Thailand and Japan	39.7		31.5
United States	3.0		3.6
Europe	1.7		1.2
Other	8.6		7.8
	100.0	%	100.0	%

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Document and Entity Information In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013
Entity Registrant Name	BROADCOM CORP
Entity Central Index Key	0001054374
Document Type	10-Q
Document Period End Date	Mar. 31, 2013
Amendment Flag	false
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q1
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Common Class A
Shares outstanding	521
Common Class B
Shares outstanding	50

XML

Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2013

Accounting Policies [Abstract]

Our Company

Our Company

Broadcom Corporation (including our subsidiaries, referred to collectively in this Report as “Broadcom,” “we,” “our” and “us”) is a global leader and innovator in semiconductor solutions for wired and wireless communications. Broadcom^® products seamlessly deliver voice, video, data and multimedia connectivity in the home, office and mobile environments. We provide the industry’s broadest portfolio of state-of-the-art system-on-a-chip, or SoC, and embedded software solutions.

Basis of Presentation

Basis of Presentation

The interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP, for interim financial information and with the instructions to Securities and Exchange Commission, or SEC, Form 10-Q and Article 10 of SEC Regulation S-X. They do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these financial statements should be read in conjunction with our audited consolidated financial statements and notes thereto for the year ended December 31, 2012, included in our 2012 Annual Report on Form 10-K filed with the SEC on January 30, 2013, referred to as our 2012 Annual Report.

The interim condensed consolidated financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly our results of operations and financial position for the interim periods. The results of operations for the three months ended March 31, 2013 are not necessarily indicative of the results to be expected for future quarters or the full year.

Use of Estimates

Use of Estimates

The preparation of financial statements in accordance with United States generally accepted accounting principles, or GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of the financial statements and the reported amounts of total net revenue and expenses in the reporting periods. We regularly evaluate estimates and assumptions related to revenue recognition, rebates, allowances for doubtful accounts, sales returns and allowances, warranty obligations, inventory valuation, stock-based compensation expense, goodwill and purchased intangible asset valuations, strategic investments, deferred income tax asset valuation allowances, uncertain tax positions, tax contingencies, self-insurance, restructuring costs or reversals, litigation and other loss contingencies. These estimates and assumptions are based on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of revenue, costs and expenses that are not readily apparent from other sources. The actual results we experience may differ materially and adversely from our estimates. To the extent there are material differences between the estimates and actual results, our future results of operations will be affected.

Segment Reporting, Policy

Broadcom has three reportable segments consistent with our target markets. Our three reportable segments are: Broadband Communications (Home), Mobile and Wireless (Hand) and Infrastructure and Networking (Infrastructure). Our Chief Executive Officer, who is our chief operating decision maker, or CODM, reviews financial information at the reportable segment level.

Our net revenue is generated principally from sales of integrated circuit products, the income we receive from the Qualcomm Agreement and other licensing revenue. While we derive some revenue from other sources, that revenue is not material as it represents approximately 1% of our total net revenue. Such revenue is classified under product revenue for reporting purposes. We group our net revenue consistent with our three target markets which comprise our reportable segments, as discussed above.

With respect to the sales of integrated circuit products, we have approximately 600 products that are grouped into approximately 60 product lines. We have concluded that these products constitute a group of similar products within each reportable segment in each of the following respects:

• the integrated circuits marketed by each of our reportable segments are sold to one type of customer: manufacturers of wired and wireless communications equipment, which incorporate our integrated circuits into their electronic products;

• the integrated circuits sold by each of our reportable segments use the same standard CMOS manufacturing processes; and

• all of our integrated circuits are sold through a centralized sales force and common wholesale distributors.

We also report an “All Other” category that is comprised of (i) income from the Qualcomm Agreement and (ii) other licensing revenue, 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, amortization of acquired inventory valuation step-up, impairment of goodwill and other long-lived assets, net settlement costs (gains), net restructuring costs, charitable contributions, non-recurring legal fees, change in contingent earnout liability, 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. 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.

Earnings Per Share

Net income per share (basic) is calculated by dividing net income by the weighted average number of common shares outstanding during the year. Net income per share (diluted) is calculated by adjusting outstanding shares, assuming any dilutive effects of stock options and restricted stock units calculated using the treasury stock method. Under the treasury stock method, an increase in the fair market value of our Class A common stock results in a greater dilutive effect from outstanding stock options, stock purchase rights and restricted stock units. Additionally, the exercise of employee stock options and stock purchase rights and the vesting of restricted stock units results in a further dilutive effect on net income per share.

Fair Value Measurements

Our financial instruments consist principally of cash and cash equivalents, short- and long-term marketable securities, accounts receivable, accounts payable and long-term debt. The fair value of a financial instrument is the amount that would be received in an asset sale or paid to transfer a liability in an orderly transaction between unaffiliated market participants. Assets and liabilities measured at fair value are categorized based on whether or not the inputs are observable in the market and the degree that the inputs are observable. The categorization of financial instruments within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) defined as follows:

Level 1: Inputs are based on quoted market prices for identical assets or liabilities in active markets at the measurement date.

Level 2:Inputs include quoted prices for similar assets or liabilities in active markets and/or quoted prices for identical or similar assets or liabilities in markets that are not active near the measurement date.

Level 3:Inputs include management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are unobservable in the market and significant to the instrument’s valuation.

The fair value of the majority of our cash equivalents and marketable securities was determined based on “Level 1” inputs. The fair value of certain marketable securities and our long-term debt were determined based on “Level 2” inputs. The valuation techniques used to measure the fair value of our “Level 2” instruments were valued based on quoted market prices or model driven valuations using significant inputs derived from or corroborated by observable market data. We do not have any marketable securities in the “Level 3” category. We believe that the recorded values of all our other financial instruments approximate their current fair values because of their nature and respective relatively short maturity dates or durations.

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Unaudited Condensed Consolidated Statements of Income (Stock-based Compensation Expense) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Details of total stock-based compensation expense by statement functional line
Stock-based compensation expense	$ 140	$ 150
Cost of product revenue
Details of total stock-based compensation expense by statement functional line
Stock-based compensation expense	7	9
Research and development
Details of total stock-based compensation expense by statement functional line
Stock-based compensation expense	99	94
Selling, general and administrative
Details of total stock-based compensation expense by statement functional line
Stock-based compensation expense	$ 34	$ 47

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Debt and Credit Facility

3 Months Ended

Mar. 31, 2013

Debt Disclosure [Abstract]

Debt and Credit Facility

Debt and Credit Facility

Senior Notes

The following table presents details of our senior notes, or Notes:

	March 31, 2013
	(In millions)
1.500% fixed-rate notes, due 2013	$	300
2.375% fixed-rate notes, due 2015	400
2.700% fixed-rate notes, due 2018	500
2.500% fixed-rate notes, due 2022	500
	$	1,700
Unaccreted discount	(6		)
Less current portion of long-term debt	(300		)
	$	1,394

In connection with the Notes issued in August 2012 and due in 2022, or the 2022 Notes, we entered into a registration rights agreement pursuant to which we agreed to use our reasonable commercial efforts to file with the SEC an exchange offer registration statement to issue registered notes with substantially identical terms as the 2022 Notes in exchange for any outstanding 2022 Notes, or, under certain circumstances, a shelf registration statement to register the 2022 Notes. In the three months ended March 31, 2013 we filed an exchange offer registration statement to issue registered notes with substantially identical terms as the original 2022 Notes. The registration statement was declared effective by the SEC and we commenced our offering on April 10, 2013. The offer will expire on May 8, 2013, or on such subsequent date or time to which we may extend the offer. If we are unable to timely complete our registration obligation, we will be subject to interest penalties.

The Notes contain a number of customary representations, warranties and restrictive covenants, including, but not limited to, restrictions on our ability to grant liens on assets; enter into sale and lease-back transactions; or merge, consolidate or sell assets. Failure to comply with these covenants, or any other event of default, could result in acceleration of the principal amount and accrued but unpaid interest on the Notes.

Relative to our overall indebtedness, the Notes rank in right of payment (i) equal with all of our other existing and future senior unsecured indebtedness (ii) senior to all of our existing and future subordinated indebtedness, and (iii) effectively subordinated to all of our subsidiaries' existing and future indebtedness and other obligations (including secured and unsecured obligations) and subordinated to our existing and future secured indebtedness and other obligations, to the extent of the assets securing such indebtedness and other obligations.

Credit Facility

In November 2010 we entered into a credit facility with certain institutional lenders that provides for unsecured revolving facility loans, swing line loans and letters of credit in an aggregate amount of up to $500 million. We amended this credit facility in October 2011 primarily to extend the maturity date by two years to November 19, 2016, at which time all outstanding revolving facility loans (if any) and accrued and unpaid interest must be repaid. The amendment to the credit facility also decreased the interest rate margins applicable to loans made under the credit facility and the commitment fee paid on the amount of the unused commitments. We have not drawn on our credit facility to date.

The credit facility contains customary representations, warranties and covenants. Financial covenants require us to maintain a consolidated leverage ratio of no more than 3.25 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00.

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Income Taxes

3 Months Ended

Mar. 31, 2013

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

We recorded a tax provision of $2 million and a tax benefit of $45 million for the three months ended March 31, 2013 and March 31, 2012, respectively. Our effective tax rates were 1.0% and (104.7)% for the three months ended March 31, 2013 and March 31, 2012, respectively. The differences between our effective tax rates and the 35% federal statutory rate, primarily relate to foreign earnings taxed at substantially lower rates than the federal statutory rate due principally to our tax holiday in Singapore, and domestic tax losses recorded without tax benefits. In addition, we recorded tax benefits of $46 million for the three months ended March 31, 2012, resulting from reductions in our U.S. valuation allowance on certain deferred tax assets due to recording net deferred tax liabilities for identifiable intangible assets under purchase accounting.

As a result of our cumulative tax losses in the U.S. and certain foreign jurisdictions, and the full utilization of our loss carryback opportunities, we have concluded that a full valuation allowance should be recorded in such jurisdictions. In certain other foreign jurisdictions where we do not have cumulative losses, we had net deferred tax liabilities of $26 million and $29 million at March 31, 2013 and December 31, 2012, respectively.

We operate under tax holidays in Singapore, which are effective through March 2014. The tax holidays are conditional upon our meeting certain employment and investment thresholds. We are in discussions with the Singapore Economic Development Board with respect to tax incentives for periods after March 31, 2014.

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Goodwill and Other Purchased Intangible Assets Goodwill and Other Purchased Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The following table summarizes the activity related to the carrying value of our goodwill:

	Reportable Segments
	Broadband Communications		Mobile and Wireless			Infrastructure and Networking			Foreign Currency			Consolidated
	(In millions)
Goodwill	$	770	$	1,013		$	3,778		$	(6	)	$	5,555
Accumulated impairment losses	—		(543		)	(1,286		)	—			(1,829		)
Goodwill at December 31, 2012	$	770	$	470		$	2,492		$	(6	)	$	3,726
Effects of foreign currency translation	—		—			—			3			3
Goodwill at March 31, 2013	$	770	$	470		$	2,492		$	(3	)	$	3,729

Purchased Intangible Assets

The following table presents details of our purchased intangible assets:

	March 31, 2013								December 31, 2012
	Gross		Accumulated Amortization			Net			Gross		Accumulated Amortization			Net
	(In millions)
Developed technology	$	1,837	$	(483	)	$	1,354		$	1,760	$	(441	)	$	1,319
In-process research and development	226		—			226			315		—			315
Customer relationships	385		(238		)	147			385		(224		)	161
Other	36		(25		)	11			36		(25		)	11
	$	2,484	$	(746	)	$	1,738		$	2,496	$	(690	)	$	1,806
Effects of foreign currency translation						(16		)						(20		)
						$	1,722							$	1,786

Amortization of Purchased Intangible Assets

The following table presents details of the amortization of purchased intangible assets included in the cost of product revenue and other operating expense categories:

	Three Months Ended
	March 31,
	2013		2012
	(In millions)
Cost of product revenue	$	43	$	37
Other operating expenses	15		17
	$	58	$	54

Amortization of Existing Purchased Intangible Assets

The following table presents details of the amortization of existing purchased intangible assets (including IPR&D), which is currently estimated to be expensed in the remainder of 2013 and thereafter:

	Purchased Intangible Asset Amortization by Year
	2013		2014		2015		2016		2017		Thereafter		Total
	(In millions)
Cost of product revenue	$	132	$	218	$	216	$	199	$	186	$	615	$	1,566
Other operating expenses	43		64		32		9		3		5		156
	$	175	$	282	$	248	$	208	$	189	$	620	$	1,722

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Supplemental Financial Information (Tables)

3 Months Ended

Mar. 31, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Inventory

The following table presents details of our inventory:

	March 31, 2013		December 31, 2012
	(In millions)
Work in process	$	205	$	187
Finished goods	318		340
	$	523	$	527

Accrued Liabilities

The following table presents details of our accrued liabilities included in current liabilities:

	March 31, 2013		December 31, 2012
	(In millions)
Accrued rebates	$	319	$	383
Accrued royalties	16		21
Accrued settlement charges	70		68
Accrued legal costs	17		15
Accrued taxes	19		16
Warranty reserve	11		13
Other	69		54
	$	521	$	570

Other Long-Term Liabilities

The following table presents details of our other long-term liabilities:

	March 31, 2013		December 31, 2012
	(In millions)
Deferred rent	$	52	$	54
Accrued taxes	82		67
Deferred tax liabilities	42		45
Accrued settlement charges	58		58
Deferred revenue	44		47
Other long-term liabilities	21		23
	$	299	$	294

Accrued Rebate Activity

The following table summarizes the activity related to accrued rebates:

	Three Months Ended
	March 31,
	2013			2012
	(In millions)
Beginning balance	$	383		$	317
Charged as a reduction of revenue	161			147
Reversal of unclaimed rebates	(6		)	(3		)
Payments	(219		)	(159		)
Ending balance	$	319		$	302

Computation of Net Income Per Share

The following table presents the computation of net income per share:

	Three Months Ended
	March 31,
	2013		2012
	(In millions, except per share data)
Numerator: Net income	$	191	$	88
Denominator for net income per share (basic)	570		548
Effect of dilutive securities:
Stock awards	15		22
Denominator for net income per share (diluted)	585		570
Net income per share (basic)	$	0.34	$	0.16
Net income per share (diluted)	$	0.33	$	0.15

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2013

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Litigation

We and certain of our subsidiaries are currently parties to various legal proceedings, including those noted in this section. Unless otherwise noted below, during the periods presented we have not: recorded any accrual for loss contingencies associated with such legal proceedings; determined that an unfavorable outcome is probable or reasonably possible; or determined that the amount or range of any possible loss is reasonably estimable. We are engaged in numerous other legal actions not described below arising in the ordinary course of our business and, while there can be no assurance, we believe that the ultimate outcome of these actions will not have a material adverse effect on our operating results, liquidity or financial position.

From time to time we may conclude it is in the best interests of our shareholders, employees, and customers to settle one or more litigation matters, and any such settlement could include substantial payments; however, other than as noted below, we have not reached this conclusion with respect to any particular matter at this time. There are a variety of factors that influence our decisions to settle and the amount we may choose to pay, including the strength of our case, developments in the litigation, the behavior of other interested parties, the demand on management time and the possible distraction of our employees associated with the case and/or the possibility that we may be subject to an injunction or other equitable remedy. It is difficult to predict whether a settlement is possible, the amount of an appropriate settlement or when is the opportune time to settle a matter in light of the numerous factors that go into the settlement decision.

Intellectual Property Proceedings

In September 2009 we filed a complaint in the United States District Court for the Central District of California against Emulex Corporation, or Emulex, alleging infringement of ten patents generally relating to networking technologies. In subsequent filings, we added two additional patents and withdrew six patents, bringing the total to six asserted patents: U.S. Patents Nos. 7,058,150; 7,471,691; 7,450,500; 6,424,194; 7,486,124, and 7,724,057 (referred to as the Asserted Patents). In its answers, Emulex denied liability and asserted counterclaims seeking a declaratory judgment that the Asserted Patents are invalid and not infringed. A trial occurred in September and October 2011, and the Court heard post-trial motions in December 2011. The Court found that the Asserted Patents are not invalid. The Court further found Emulex infringed the ‘150 and ‘691 patents. In March 2012, the Court granted Broadcom’s motion for an injunction on the ‘150 and ‘691 patents and in April 2012, the Court entered an injunction against Emulex. The injunction contained a sunset period, which expired on April 11, 2013. Emulex recently filed a motion to extend the sunset period, which the Court denied. Emulex filed an appeal of the Court’s rulings on the ‘150 and ‘691 patents to the Federal Circuit. On the remaining Asserted Patents, the jury found the ‘500 patent was not infringed and failed to reach a verdict on infringement for the ‘194, ‘124, and ‘057 patents. The Court has scheduled a new trial regarding the ‘194, ‘124, and ‘057 patents for November 2013.

On July 3, 2012, Broadcom and Emulex entered into a partial settlement and license agreement for the Asserted Patents. Under the terms of the agreement, the parties dismissed their respective claims on the ‘691 and ‘500 patents, Emulex received a license and release related to the Asserted Patents for certain products for certain fields of use and Emulex was required to make a payment of certain amounts to Broadcom. The litigation proceedings for the ‘150, ‘194, ‘124, and ‘057 patents will continue relating to Emulex’s unlicensed activity.

In November 2009 we filed a complaint in the United States District Court for the Eastern District of Texas

against the Commonwealth Scientific and Industrial Research Organisation, or CSIRO, seeking a declaratory

judgment that a certain U.S. patent number is invalid, unenforceable and not infringed. CSIRO answered the

complaint and counterclaimed for infringement against Broadcom wireless LAN products and sought damages,

attorney’s fees, and an injunction. Following a court ordered mediation session in March 2012, Broadcom and

CSIRO entered into a settlement agreement resolving the litigation and the Court dismissed the parties’ claims with

prejudice. The terms of the settlement agreement included a full release from liability for all asserted claims, the grant

of a perpetual license under the asserted patent and all related patents to Broadcom, and the payment of certain

amounts by Broadcom.

In August 2010, we filed a motion to intervene (i.e., to be added as a party) in U.S. Ethernet Innovations, LLC v. Acer, Inc., Case No. 10-cv-03724-JW (N.D. Cal.). In this case, U.S. Ethernet Innovations, LLC, or USEI, filed a patent infringement complaint alleging that numerous companies, including certain of our customers, infringe patents relating generally to Ethernet technology. USEI seeks monetary damages, attorney’s fees, and an injunction. Defendants have filed answers denying the allegations in USEI’s complaint and asserting counterclaims for declaratory judgment that USEI’s patents are invalid, unenforceable, and not infringed. We contend that we have a license related to USEI’s patents and are seeking to assert this license as a defense. In December 2010, the Court granted our motion to intervene. Trial has been set for January 2015.

We and our subsidiaries are also involved in other intellectual property proceedings, claims and litigation. We will disclose the nature of any such matter if we believe it to be material. Particularly in the early stages of such proceedings, an assessment of materiality may be complicated by limited information, including, without limitation, limited information about the patents-in-suit and Broadcom products against which the patents are being asserted. Accordingly, our assessment of materiality may change in the future based upon availability of discovery and further developments in the proceedings at issue. Some of these intellectual property proceedings may involve, for example, “non-practicing entities” asserting claims addressing certain of our products. The resolution of intellectual property litigation can include, among other things, payment of damages, royalties, or other amounts, which could adversely, impact our product gross margins in future periods, or could prevent us from manufacturing or selling some of our products or limit or restrict the type of work that employees may perform for us. In addition, from time to time we are approached by holders of intellectual property, including non-practicing entities, to engage in discussions about our obtaining licenses to their intellectual property. We will disclose the nature of any such discussion if we determine that (i) it is probable an intellectual property holder will assert a claim of infringement, (ii) there is a reasonable possibility the outcome (assuming assertion) will be unfavorable, and (iii) the resulting liability would be material to our financial condition.

Other Proceedings

In April 2008 we delivered a Notice of Arbitration and Arbitration Claim to our former independent registered public accounting firm Ernst & Young LLP, or E&Y, and certain related parties. The arbitration relates to the issues that led to the restatement of our financial statements for the periods from 1998 through March 31, 2006 as disclosed in an amended Annual Report on Form 10-K/A for the year ended December 31, 2005 and an amended Quarterly Report on Form 10-Q/A for the three months ended March 31, 2006, each filed with the SEC January 23, 2007. In May 2008 E&Y delivered a Notice of Defense and Counterclaim. The arbitration hearing occurred in January 2013 and we are awaiting a decision from the panel.

In February 2012 we were notified by the SEC’s Division of Enforcement - Los Angeles Regional office that it is conducting a formal investigation of our accounting practices related to litigation reserves. The SEC has requested documents and information for the time period commencing June 1, 2010 to the present. We believe that the SEC’s investigation was prompted by allegations of a former employee relating to our processes and decisions regarding litigation reserves in the first quarter of 2011 in connection with asserted and unasserted intellectual property claims. Following our receipt of these allegations in April 2011, we, with oversight from the Audit Committee of the Board of Directors, conducted an internal review of these allegations with the assistance of independent outside counsel and did not identify any improprieties. This investigation was completed during the three months ended June 30, 2011. In addition, based on the internal review, the results of which were discussed with the our independent registered public accounting firm, we determined that no adjustments to our fiscal 2010 and March 31, 2011 consolidated financial statements were necessary relating to the subject matter of the review. We are cooperating with the SEC’s investigation.

In July 2012, a former employee filed a lawsuit against us alleging wrongful termination in violation of the Dodd-Frank Wall Street Reform and Consumer Protection Act and fundamental public policy under state law. The former employee alleges that he was terminated in June 2011 because he raised concerns that Broadcom did not appropriately accrue for and report certain loss contingencies in the three months ended March 31, 2011. We believe the lawsuit is without merit. On December 7, 2012, we filed a motion to dismiss the case. The court granted our motion and gave the plaintiff leave to amend his complaint. Plaintiff filed his First Amended Complaint on February 20, 2013. We have filed a motion to dismiss the First Amended Complaint. The hearing on that motion is scheduled for May 16, 2013.

General

We and our subsidiaries are also involved in other legal proceedings, claims and litigation arising in the ordinary course of business. We will disclose the nature of any such matter if we believe it to be material.

The pending proceedings described above involve complex questions of fact and law and may require the expenditure of significant funds and the diversion of other resources to prosecute and defend. The results of legal proceedings are inherently uncertain, and material adverse outcomes are possible. From time to time we may enter into confidential discussions regarding the potential settlement of pending intellectual property or other litigation or other proceedings; however, there can be no assurance that any such discussions will occur or will result in a settlement. In the course of such settlement discussions, if we conclude that a settlement loss is probable and the settlement amount is estimable we may record settlement costs, notwithstanding not having reached a final settlement agreement. The settlement of any pending litigation or other proceedings could require us to incur substantial settlement payments and costs. Furthermore, the settlement of any intellectual property proceeding may require us to grant a license to certain of our intellectual property rights to the other party under a cross-license agreement. If any of those events were to occur, our business, financial condition and results of operations could be materially and adversely affected.

Settlement Costs and Other Related Items

We did not record any settlement costs in the three months ended March 31, 2013. We recorded settlement costs of $86 million in the three months ended March 31, 2012 related to the settlement of patent infringement claims.  Upon the occurrence of certain events, we may be required to record additional settlement costs of up to $20 million related to a patent infringement case that settled in 2011.

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Shareholders' Equity

3 Months Ended

Mar. 31, 2013

Equity [Abstract]

Shareholders' Equity

Shareholders’ Equity

Quarterly Dividend

In January 2013 our Board of Directors adopted an amendment to the existing dividend policy pursuant to which we increased the quarterly cash dividend by 10.0% to $0.11 per share ($0.44 per share on an annual basis) payable to holders of our common stock. In the three months ended March 31, 2013 and 2012 we paid $63 million and $55 million, respectively, in dividends to holders of our Class A and Class B common stock. These dividends were paid from U.S. domestic sources other than our retained earnings and are accounted for as reductions of shareholders’ equity.

Share Repurchase Program

In February 2010 we announced that our Board of Directors had authorized an evergreen share repurchase program intended to offset dilution of incremental grants of stock awards associated with our stock incentive plans. The maximum number of shares of our Class A common stock that may be repurchased in any one year under this program (including under an accelerated share repurchase agreement or other arrangement) is equal to the total number of shares issued pursuant to our equity awards in the previous year and the current year. This program does not have an expiration date and may be suspended at any time at the discretion of the Board of Directors. It may also be complemented with an additional share repurchase program in the future. Under the evergreen program we repurchased 3.2 million shares of our Class A common stock at a weighted average price of $33.42 in the three months ended March 31, 2013.

Repurchases under our share repurchase programs were and are intended to be made in open market or privately negotiated transactions in compliance with Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended, or the Exchange Act.

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Employee Benefit Plans

3 Months Ended

Mar. 31, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Employee Benefit Plans

Employee Benefit Plans

Combined Incentive Plan Activity

Restricted stock unit activity is set forth below:

	Restricted Stock Units Outstanding
	Number of Shares		Weighted Average Grant-Date Fair Value per Share
	(In millions, except per share data)
Balance at December 31, 2012	25		$	35.55
Restricted stock units granted	12		33.81
Restricted stock units cancelled	—		35.05
Restricted stock units vested	(4	)	33.06
Balance at March 31, 2013	33		$	35.19

Stock option activity is set forth below:

	Options Outstanding
	Number of Shares		Weighted Average Exercise Price per Share		Weighted Average Grant-Date Fair Value per Share
	(In millions, except per share data)
Balance at December 31, 2012	58		$	28.11	$	14.95
Options cancelled	—		40.47		12.64
Options exercised	(4	)	22.15		23.46
Balance at March 31, 2013	54		$	28.42	$	14.46

The following table presents details of unearned stock-based compensation currently estimated to be expensed in the remainder of 2013 through 2017 related to unvested share-based payment awards:

	2013		2014		2015		2016		2017		Total
	(In millions)
Unearned stock-based compensation	$	384	$	373	$	233	$	119	$	15	$	1,124

If there are any modifications or cancellations of the underlying unvested awards, we may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that we grant additional equity awards or assume unvested equity awards in connection with acquisitions.

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Goodwill and Other Purchased Intangible Assets

3 Months Ended

Mar. 31, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Purchased Intangible Assets

Goodwill and Other Purchased Intangible Assets

Goodwill

The following table summarizes the activity related to the carrying value of our goodwill:

	Reportable Segments
	Broadband Communications		Mobile and Wireless			Infrastructure and Networking			Foreign Currency			Consolidated
	(In millions)
Goodwill	$	770	$	1,013		$	3,778		$	(6	)	$	5,555
Accumulated impairment losses	—		(543		)	(1,286		)	—			(1,829		)
Goodwill at December 31, 2012	$	770	$	470		$	2,492		$	(6	)	$	3,726
Effects of foreign currency translation	—		—			—			3			3
Goodwill at March 31, 2013	$	770	$	470		$	2,492		$	(3	)	$	3,729

As discussed in our 2012 Annual Report, based on our annual asset impairment testing and the increased balance of goodwill due to our recent acquisitions, including our acquisition of NetLogic Microsystems, Inc., or NetLogic, we determined there was a risk of our Infrastructure and Networking reporting unit failing the first step of the goodwill impairment test in future periods. The level of excess fair value over carrying value for this reporting unit was approximately 19% as of October 1, 2012. There have been no significant additional indicators of impairment that would require us to update our 2012 annual impairment testing in the three months ended March 31, 2013.

Purchased Intangible Assets

The following table presents details of our purchased intangible assets:

	March 31, 2013								December 31, 2012
	Gross		Accumulated Amortization			Net			Gross		Accumulated Amortization			Net
	(In millions)
Developed technology	$	1,837	$	(483	)	$	1,354		$	1,760	$	(441	)	$	1,319
In-process research and development	226		—			226			315		—			315
Customer relationships	385		(238		)	147			385		(224		)	161
Other	36		(25		)	11			36		(25		)	11
	$	2,484	$	(746	)	$	1,738		$	2,496	$	(690	)	$	1,806
Effects of foreign currency translation						(16		)						(20		)
						$	1,722							$	1,786

In the three months ended March 31, 2013 we reclassified $80 million of IPR&D costs related to our acquisition of NetLogic to developed technology and such costs will now be amortized to cost of product revenue.

In March 2013 we recorded impairment charges, primarily for IPR&D of $10 million, related to our acquisition of Provigent, Inc. included in our Infrastructure and Networking reportable segment. In March 2012 we recorded impairment charges for developed technology of $28 million, primarily related to our acquisitions of Dune Networks, Inc. and Percello Ltd. included in our Infrastructure and Networking, and Broadband Communications reportable segments, respectively. The primary factor contributing to these impairment charges was the reduction in the revenue outlook for certain products and the resulting decrease to the estimated cash flows identified with the impaired assets.

In determining the amount of the impairment charges we calculated fair values as of the impairment date for acquired intangible assets. The fair value was determined using the multiple period excess earnings method. The fair values were determined using significant unobservable inputs categorized as Level 3 inputs. The key unobservable inputs utilized in the model include discount rates ranging from 14% to 25%, a market participant tax rate of 15%, and a probability adjusted level of future cash flows based on current product and market data.

The following table presents details of the amortization of purchased intangible assets included in the cost of product revenue and other operating expense categories:

	Three Months Ended
	March 31,
	2013		2012
	(In millions)
Cost of product revenue	$	43	$	37
Other operating expenses	15		17
	$	58	$	54

The following table presents details of the amortization of existing purchased intangible assets (including IPR&D), which is currently estimated to be expensed in the remainder of 2013 and thereafter:

	Purchased Intangible Asset Amortization by Year
	2013		2014		2015		2016		2017		Thereafter		Total
	(In millions)
Cost of product revenue	$	132	$	218	$	216	$	199	$	186	$	615	$	1,566
Other operating expenses	43		64		32		9		3		5		156
	$	175	$	282	$	248	$	208	$	189	$	620	$	1,722

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Debt and Credit Facility (Details Textual) (USD $)	1 Months Ended	3 Months Ended
	Nov. 30, 2011	Mar. 31, 2013	Nov. 01, 2010
Debt Disclosure [Abstract]
Line of Credit Facility, Covenant Terms		The credit facility contains customary representations, warranties and covenants. Financial covenants require us to maintain a consolidated leverage ratio of no more than 3.25 to 1.00 and a consolidated interest coverage ratio of no less than 3.00 to 1.00.
Credit Facitlity Extension	2 years
Unsecured revolving facility loans aggregate available amount to be drawn			$ 500,000,000
Amount outstanding on line of credit facility		$ 0

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Debt and Credit Facility (Tables)

3 Months Ended

Mar. 31, 2013

Debt Disclosure [Abstract]

Summary of debt

The following table presents details of our senior notes, or Notes:

	March 31, 2013
	(In millions)
1.500% fixed-rate notes, due 2013	$	300
2.375% fixed-rate notes, due 2015	400
2.700% fixed-rate notes, due 2018	500
2.500% fixed-rate notes, due 2022	500
	$	1,700
Unaccreted discount	(6		)
Less current portion of long-term debt	(300		)
	$	1,394

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Supplemental Financial Information (Details 2) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2012	Dec. 31, 2011
Accrued Liabilities, Current [Abstract]
Accrued rebates	$ 319	$ 383	$ 302	$ 317
Accrued royalties	16	21
Accrued settlement charges	70	68
Accrued legal costs	17	15
Accrued taxes	19	16
Warranty reserve	11	13
Other	69	54
Accrued liabilities	521	570
Other Liabilities, Noncurrent [Abstract]
Deferred rent	52	54
Accrued taxes	82	67
Deferred tax liabilities	42	45
Accrued settlement charges	58	58
Deferred revenue	44	47
Other long-term liabilities	21	23
Other long-term liabilities, Total	$ 299	$ 294

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Business Enterprise Segments, Significant Customer and Geographical Information (Details Textual)	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Segment Reporting Information [Line Items]
Number of reportable segments	3
Net revenue from other sources	1.00%
Number of products	600
Number of product lines	60
Significant customer threshold	10.00%
Sales [Member] | Largest Two Customers [Member]
Segment Reporting Information [Line Items]
Customer risk	36.80%	31.30%
Sales [Member] | Largest Five Customers [Member]
Segment Reporting Information [Line Items]
Customer risk	51.40%	49.20%

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Goodwill and Other Purchased Intangible Assets (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Dec. 31, 2012
Goodwill [Line Items]
Goodwill		$ 5,555
Accumulated impairment losses		(1,829)
Goodwill [Roll Forward]
Goodwill at December 31, 2012	3,726
Effects of foreign currency translation	3
Goodwill at March 31, 2013	3,729
Broadband Communications [Member]
Goodwill [Line Items]
Goodwill		770
Accumulated impairment losses		0
Goodwill [Roll Forward]
Goodwill at December 31, 2012	770
Effects of foreign currency translation	0
Goodwill at March 31, 2013	770
Mobile and Wireless [Member]
Goodwill [Line Items]
Goodwill		1,013
Accumulated impairment losses		(543)
Goodwill [Roll Forward]
Goodwill at December 31, 2012	470
Effects of foreign currency translation	0
Goodwill at March 31, 2013	470
Infrastructure and Networking [Member]
Goodwill [Line Items]
Goodwill		3,778
Accumulated impairment losses		(1,286)
Goodwill [Roll Forward]
Goodwill at December 31, 2012	2,492
Effects of foreign currency translation	0
Goodwill at March 31, 2013	2,492
Foreign Currency [Member]
Goodwill [Line Items]
Goodwill		(6)
Accumulated impairment losses		0
Goodwill [Roll Forward]
Goodwill at December 31, 2012	(6)
Effects of foreign currency translation	3
Goodwill at March 31, 2013	$ (3)

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Unaudited Condensed Consolidated Statements of Comprehensive Income (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Statement of Other Comprehensive Income [Abstract]
Net income	$ 191	$ 88
Other comprehensive income, net of tax:
Foreign currency translation adjustments, net of $0 tax in 2013 and 2012	2	20
Unrealized gains on marketable securities, net of $0 tax in 2013 and 2012	1	3
Other comprehensive income	3	23
Comprehensive income	$ 194	$ 111

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Fair Value Measurements

3 Months Ended

Mar. 31, 2013

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Our financial instruments consist principally of cash and cash equivalents, short- and long-term marketable securities, accounts receivable, accounts payable and long-term debt. The fair value of a financial instrument is the amount that would be received in an asset sale or paid to transfer a liability in an orderly transaction between unaffiliated market participants. Assets and liabilities measured at fair value are categorized based on whether or not the inputs are observable in the market and the degree that the inputs are observable. The categorization of financial instruments within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) defined as follows:

Level 1: Inputs are based on quoted market prices for identical assets or liabilities in active markets at the measurement date.

Level 2:Inputs include quoted prices for similar assets or liabilities in active markets and/or quoted prices for identical or similar assets or liabilities in markets that are not active near the measurement date.

Level 3:Inputs include management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are unobservable in the market and significant to the instrument’s valuation.

The fair value of the majority of our cash equivalents and marketable securities was determined based on “Level 1” inputs. The fair value of certain marketable securities and our long-term debt were determined based on “Level 2” inputs. The valuation techniques used to measure the fair value of our “Level 2” instruments were valued based on quoted market prices or model driven valuations using significant inputs derived from or corroborated by observable market data. We do not have any marketable securities in the “Level 3” category. We believe that the recorded values of all our other financial instruments approximate their current fair values because of their nature and respective relatively short maturity dates or durations.

Instruments Measured at Fair Value on a Recurring Basis. The following tables present our cash and marketable securities’ costs, gross unrealized gains, gross unrealized losses and fair value by major security type recorded as cash and cash equivalents or short-term or long-term marketable securities:

	March 31, 2013
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cash and Cash Equivalents		Short-Term Marketable Securities		Long-Term Marketable Securities
	(In millions)
Cash	$	221	$	—	$	—	$	221	$	221	$	—	$	—
Level 1:
Bank and time deposits	1,173		—		—		1,173		1,143		20		10
Money market funds	300		—		—		300		300		—		—
U.S. treasury and agency obligations	850		1		—		851		3		176		672
Corporate bonds	1		—		—		1		—		1		—
Subtotal	2,324		1		—		2,325		1,446		197		682
Level 2:
Commercial paper	182		—		—		182		49		133		—
Corporate bonds	1,140		2		—		1,142		26		374		742
Asset-backed securities and other	56		—		—		56		—		23		33
Subtotal	1,378		2		—		1,380		75		530		775
Level 3:
None	—		—		—		—		—		—		—
Total	$	3,923	$	3	$	—	$	3,926	$	1,742	$	727	$	1,457

	December 31, 2012
	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Cash and Cash Equivalents		Short-Term Marketable Securities		Long-Term Marketable Securities
	(In millions)
Cash	$	213	$	—	$	—		$	213	$	213	$	—	$	—
Level 1:
Bank and time deposits	904		—		—			904		884		20		—
Money market funds	250		—		—			250		250		—		—
U.S. treasury and agency obligations	936		1		—			937		—		201		736
Corporate bonds	1		—		—			1		—		1		—
Subtotal	2,091		1		—			2,092		1,134		222		736
Level 2:
Commercial paper	432		—		—			432		270		162		—
Corporate bonds	921		2		(1		)	922		—		351		571
Asset-backed securities and other	63		—		—			63		—		22		41
Subtotal	1,416		2		(1		)	1,417		270		535		612
Level 3:
None	—		—		—			—		—		—		—
Total	$	3,720	$	3	$	(1	)	$	3,722	$	1,617	$	757	$	1,348

There were no transfers between Level 1, Level 2 or Level 3 securities in the three months ended March 31, 2013. All of our long-term marketable securities had maturities of between one and three years in duration at March 31, 2013. Our cash, cash equivalents and marketable securities at March 31, 2013 consisted of $2.37 billion held domestically, with the remaining balance of $1.56 billion held by foreign subsidiaries.

At March 31, 2013 we had 85 investments with a fair value of $527 million that were in an unrealized loss position for less than 12 months. Our gross unrealized losses of less than $1 million for these investments at March 31, 2013 were due to changes in market rates. We have determined that the gross unrealized losses on these investments at March 31, 2013 are temporary in nature. We evaluate securities for other-than-temporary impairment on a quarterly basis. Impairment is evaluated considering numerous factors, and their relative significance varies depending on the situation. Factors considered include the length of time and extent to which fair value has been less than the cost basis, the financial condition and near-term prospects of the issuer, and our intent and ability to hold the investment in order to allow for an anticipated recovery in fair value.

Instruments Not Recorded at Fair Value on a Recurring Basis. We measure the fair value of our long-term debt carried at amortized cost quarterly for disclosure purposes. The estimated fair value of long-term debt is determined by Level 2 inputs and is based primarily on quoted market prices for the same or similar issues. Based on the market prices, the fair value of our long-term debt was $1.74 billion and $1.75 billion as of March 31, 2013 and December 31, 2012, respectively. The recorded values of all our accounts receivable and accounts payable approximate their current fair values because of their nature and respective relatively short maturity dates or durations.

Assets and Liabilities Recorded at Fair Value on a Non-Recurring Basis. We measure the fair value of our cost method investments when they are deemed to be other-than-temporarily impaired, assets acquired and liabilities assumed in a business acquisition, and goodwill and other long lived assets when they are held for sale or determined to be impaired. See Note 9 for discussion on fair value measurements of certain assets and liabilities recorded at fair value on a non-recurring basis.

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Supplemental Financial Information (Details 3) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Accrued Rebate Activity
Beginning balance	$ 383	$ 317
Charged as a reduction to revenue	161	147
Reversal of unclaimed rebates	(6)	(3)
Payments	(219)	(159)
Ending balance	$ 319	$ 302

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Employee Benefit Plans (Details 2) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013
Unearned stock-based compensation estimated to be expensed related to unvested share-based payment awards
2013	$ 384
2014	373
2015	233
2016	119
2017	15
Total	$ 1,124

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Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2013

Fair Value Disclosures [Abstract]

Cash and cash equivalents or short-term or long-term marketable securities

The following tables present our cash and marketable securities’ costs, gross unrealized gains, gross unrealized losses and fair value by major security type recorded as cash and cash equivalents or short-term or long-term marketable securities:

	March 31, 2013
	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Cash and Cash Equivalents		Short-Term Marketable Securities		Long-Term Marketable Securities
	(In millions)
Cash	$	221	$	—	$	—	$	221	$	221	$	—	$	—
Level 1:
Bank and time deposits	1,173		—		—		1,173		1,143		20		10
Money market funds	300		—		—		300		300		—		—
U.S. treasury and agency obligations	850		1		—		851		3		176		672
Corporate bonds	1		—		—		1		—		1		—
Subtotal	2,324		1		—		2,325		1,446		197		682
Level 2:
Commercial paper	182		—		—		182		49		133		—
Corporate bonds	1,140		2		—		1,142		26		374		742
Asset-backed securities and other	56		—		—		56		—		23		33
Subtotal	1,378		2		—		1,380		75		530		775
Level 3:
None	—		—		—		—		—		—		—
Total	$	3,923	$	3	$	—	$	3,926	$	1,742	$	727	$	1,457

	December 31, 2012
	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Cash and Cash Equivalents		Short-Term Marketable Securities		Long-Term Marketable Securities
	(In millions)
Cash	$	213	$	—	$	—		$	213	$	213	$	—	$	—
Level 1:
Bank and time deposits	904		—		—			904		884		20		—
Money market funds	250		—		—			250		250		—		—
U.S. treasury and agency obligations	936		1		—			937		—		201		736
Corporate bonds	1		—		—			1		—		1		—
Subtotal	2,091		1		—			2,092		1,134		222		736
Level 2:
Commercial paper	432		—		—			432		270		162		—
Corporate bonds	921		2		(1		)	922		—		351		571
Asset-backed securities and other	63		—		—			63		—		22		41
Subtotal	1,416		2		(1		)	1,417		270		535		612
Level 3:
None	—		—		—			—		—		—		—
Total	$	3,720	$	3	$	(1	)	$	3,722	$	1,617	$	757	$	1,348