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]
Read the full article here