The successful sale or wind-down of the cellular baseband business is currently expected to result in a roughly $700 million reduction in annualized GAAP research and development and selling, general and administrative expenses, of which approximately $100 million relates to estimated reductions in stock-based compensation. As such, non-GAAP research and development and selling, general and administrative expenses are currently expected to be reduced by roughly $600 million. These estimates do not reflect the impact of any potential impairment and/or restructuring charges that are likely to be recorded related to the successful sale or wind-down of Broadcom’s cellular baseband business.
Broadcom currently expects to organically reinvest roughly $50 million of these savings on an annualized basis into projects in the Broadband, Infrastructure and Connectivity businesses. This incremental spending is currently expected to strengthen and accelerate the company’s plans in the area of small cells, embedded processing and low-power connectivity.