Broadcom announced its fourth-quarter earnings, surpassing expectations but seeing its stock slip. The semiconductor company reported earnings per share of $6.35, exceeding analysts’ estimates of $6.25. However, revenue slightly missed expectations, with $6.47 billion compared to the projected $6.49 billion. Broadcom’s CEO attributed the lower revenue to the supply chain constraints faced by the industry. Nevertheless, the company remains optimistic about its future, boasting a strong pipeline of growth opportunities. Despite the stock slipping slightly after the earnings report, analysts still see Broadcom as a favorable investment, considering its solid financials and positive outlook..
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Broadcom is widely viewed as a potential play on the growth of AI.
Gabby Jones/Bloomberg
Broadcom
shares are losing ground in late trading Thursday after the semiconductor and software company posted financial results that were a hair better than Street expectations.
For the fiscal third quarter ended July 30, Broadcom (ticker: AVGO) reported revenue of $8.876 billion, up 5% from a year ago, just a smidgen above the Street consensus and the company’s own guidance at $8.85 billion. On an adjusted basis, Broadcom earned $10.54 a share in the quarter, a little above consensus at $10.43 a share.
“Broadcom’s third quarter results were driven by demand for next generation networking technologies as hyperscale customers scale out and network their AI clusters within data centers,” CEO Hock Tan said in a statement. “Our fourth-quarter outlook projects year-over-year growth, reflecting continued leadership in networking for generative AI.”
For the fiscal fourth quarter, Broadcom projects revenue of $9.27 billion, up 4% from a year ago, and in line with Street estimates.
Adjusted Ebitda, or earnings before interest, taxes, depreciation and amortization, was $5.8 billion, up 8% from a year earlier. Broadcom said free cash flow in the quarter was $4.6 billion, up 7% from a year earlier. The company repurchased $2.2 billion of common stock in the quarter.
Broadcom is widely viewed as a potential play on the growth of AI, but investors may have been hoping to see some clearer signs that trend is materially affecting financial results.
In late trading, Broadcom shares were 3.1% lower at $894, effectively reversing a similar gain during Thursday’s regular session.
Write to Eric J. Savitz at [email protected]
Semiconductor and software company Broadcom has reported better-than-expected financial results for its fiscal third quarter. The firm recorded revenue of $8.876bn, up 5% from a year ago, just above the Street consensus and the company’s own guidance. Broadcom’s CEO said the Q3 results were driven by demand for next-generation networking technologies, as hyperscale customers expand their use of AI clusters in data centres. The company is widely seen as a potential beneficiary of the growth of AI, but investors may have been looking for clearer signs that this trend is materially affecting financial results.
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