Broadcom logs earnings beat, but chip stock edges lower

Broadcom logs earnings beat, but chip stock edges lower

Company gives $50 billion full-year forecast when including VMware contributions

Broadcom Inc. topped profit expectations for its latest quarter, but shares of the chip company were falling in Thursday’s aftermarket action.

The company recorded fiscal fourth-quarter net income of $3.5 billion, or $8.25 a share, whereas it posted net income of $3.3 billion, or $7.83 a share, in the year-earlier period.

On an adjusted basis, Broadcom AVGO, +2.06% earned $11.06 a share, up from $10.45 a share a year before, while analysts tracked by FactSet were modeling $10.96 a share.

Revenue increased to $9.30 billion from $8.93 billion, while the FactSet consensus was for $9.28 billion. Broadcom generated $7.33 billion in revenue from semiconductor solutions, up 3%, along with $1.97 billion in revenue from infrastructure solutions, up 7%.

Results were “driven by investments in accelerators and network connectivity for AI by hyperscalers,” Chief Executive Hock Tan said in a release.

Broadcom’s stock was off about 2% in Thursday’s extended session.

For the new fiscal year, Broadcom anticipates $50 billion in revenue, when including contributions from the recently closed acquisition of VMware that may not be fully reflected in consensus estimates. The company also expects adjusted earnings before interest, taxes, depreciation and amortization to be about 60% of projected revenue; it was 65% of revenue in the most recent fiscal year.

The company expects its semiconductor segment to sustain a mid- to high-single-digit revenue growth rate in fiscal 2024.

error: Content is protected !!