Insiders at chip-maker Broadcom cost the company $2.24 billion more than it previously disclosed as a result of backdating stock options, according to this WSJ story. Yesterday, Broadcom restated earnings from 1998 through the first quarter of 2006 to reflect charges for the options.
The revelation strikes Blawgletter as a big problem for Broadcom and potentially the beneficiaries of the backdating. Many of the companies that backdated haven’t lost material amounts as a consequence, but $2.24 billion looks pretty material from Blawgletter’s perch. We’ll see.