Businessweek

Avago Technologies Limited designs, develops, and supplies a range of analog semiconductor devices. The company serves three markets, with its wireless communications, wired infrastructure and industrial and automotive electronics target markets. Applications for its products in these target markets include cellular phones, consumer appliances, data networking and telecommunications equipment, enterprise storage and servers, factory automation and displays. Markets and Products The company’s product portfolio ranges from simple discrete devices to complex sub-systems that include multiple device types and incorporate firmware for interface between digital systems. In some cases, its products include mechanical hardware that interfaces with optoelectronic or capacitive sensors. Wireless Communications: The company supports the wireless industry with radio frequency (RF) semiconductor devices, including monolithic microwave integrated circuit filters and duplexers using its proprietary film bulk acoustic resonator (FBAR) technology, front end modules that incorporate multiple die into multi-function RF devices, diodes and discrete transistors. The company’s proprietary gallium arsenide, or GaAs, processes are critical to the production of power amplifier (PA), and low noise amplifier products. The company also supplies light emitting diodes (LEDs), for camera-phone flashes and for backlighting applications in mobile handset keypads. Wired Infrastructure: In the storage and Ethernet networking markets, the company supplies transceivers that receive and transmit information along optical fibers. The company provides a range of product bandwidth options for customers, including options ranging from 125 megabyte data, or MBd, Fast Ethernet transmitters and receivers to 16 Gigabit transceivers. For enterprise networking and server input/output, or I/O, applications, the company also supplies high speed serializer/deserializer, or SerDes, products integrated into application specific integrated circuits, or ASICs. Industrial and Automotive Electronics: The company provides products for the general industrial, automotive and consumer appliance markets. It offers optical isolators, or optocouplers, which provide electrical insulation and signal isolation for signaling systems that are susceptible to electrical noise or interference. Optocouplers are used in a set of applications, including industrial motors, automotive systems including those used in hybrid engines, power generation and distribution systems, switching power supplies, motion sensors, telecommunications equipment, consumer appliances, computers and office equipment, plasma displays, and military electronics. For industrial motors and robotic motion control, the company supplies optical encoders, as well as integrated circuits, or ICs, for the controller and decoder functions. For industrial networking, the company provides fast Ethernet and faster optical transceivers using plastic optical fiber that enable quick and interoperable networking and factory automation. Research and Development The company’s research and development expenses were $335 million, as of October 28, 2012. Customers The company has a diversified customer base of approximately 25,000 end customers. Its major customer includes Foxconn Technology Group. Intellectual Property As of October 28, 2012, the company had approximately 2,000 U.S. and 1,200 foreign patents and approximately 400 U.S. and 700 foreign pending patent applications. The expiration dates of its patents range from 2013 to 2031. Environmental and Other Regulations The company is also subject to regulation by the United States Occupational Safety and Health Administration and similar health and safety laws in other jurisdictions. The company is also subject to new SEC rules that require diligence, disclosure and reporting on whether certain minerals and metals, known as conflict minerals, used in its products originate from the Democratic Republic of Congo and adjoining countries. Seasonality The company is affected by seasonal trends in the semiconductor and related industries. The company experiences sequentially lower revenues in the first half of the year. Its revenue in the second half of the year is higher than its revenue in the first half of the year due to seasonality in its wireless communications target market. Competition The company’s primary competitors are Hittite Microwave Corporation; Murata Manufacturing Co., Ltd.; RF Micro Devices, Inc.; Skyworks Solutions, Inc.; ams AG (formerly TAOS Inc.); and TriQuint Semiconductor, Inc. Its competitors also include Finisar Corporation; International Business Machines Corp.; Microelectronics Division; LSI Corporation; and ST Microelectronics N.V. In the industrial and automotive electronics target market, the company’s primary competitors are Analog Devices, Inc.; Heidenhain Corporation; Renesas Electronics Corporation; and Toshiba Corporation. Significant Events In March 2013, Avago Technologies Limited and Corning Inc. announced collaboration on new optical cabling connectivity solutions. Avago Technologies has developed a series of pluggable transceivers and Atlas optical engines at 40G/100G and beyond, ideally suited for the Ethernet, Storage, and high performance computing applications. History Avago Technologies Limited was founded in 2005. The company was incorporated under the laws of the Republic of Singapore in 2005.