Broadcom Stock Rises After Beating Q4 Revenue and Profit Expectations


Broadcom Inc (NASDAQ: AVGO)

Shares of Broadcom gained more than 5% in after-hours trading on Thursday after the chipmaker posted higher-than-expected fiscal fourth-quarter earnings.

The stock had traded sharply lower throughout the regular trading session before the chipmaker announced the quarterly results.

Shares of other U.S. semiconductors have also taken a bath in the past few weeks as Wall Street continues to contemplate how they could be affected by the ongoing U.S.-China trade war.

AVGO Earnings & Outlook

Broadcom reported fourth quarter net income of $1.12 billion, or $2.64 per share, up from $532 million, or $1.25 per share, in the same three months last year. Earnings, adjusted for one-time costs and gains, came to $5.85 per share from $4.59 per share a year ago.

Revenue climbed to $5.44 billion, up 12% from $4.84 billion in the same period last year. Analysts were expecting adjusted earnings of $5.58 per share on revenue of $5.4 billion for the quarter. Looking ahead, the company sees fiscal 2019 revenue of $24.5 billion, which is ahead analyst consensus of 22.58 billion.

Broadcom CEO Comments

“Strong operating performance in the fiscal fourth quarter caps a year of solid results that continues to reinforce the sustainability of our business model. Revenues grew 18% to nearly $21 billion on the back of strong demand for our networking, enterprise storage, wireless and industrial products while operating margin continued to progressively expand to 50%,” said Hock Tan, President and CEO of Broadcom Inc.

“Looking forward to fiscal year 2019, we expect another year of double digit revenue growth. Sustained demand within our semiconductor segment will be augmented by the newly acquired mainframe and enterprise software businesses to our infrastructure software segment. We also expect operating margin to hit another record in fiscal year 2019 driven by improved operating leverage.”

Broadcom Inc. Profile

Broadcom Inc. designs, develops, and supplies a range of semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company operates through four segments: Wired Infrastructure, Wireless Communications, Enterprise Storage, and Industrial & Other.

The Wired Infrastructure segment provides set-top box system-on-chips, cable, digital subscriber line, passive optical networking central office, and Ethernet switching and routing application products. The Wireless Communications segment offers RF front end modules, filters, and power amplifiers; and custom touch controllers.

The Enterprise Storage segment provides serial attached small computer system interface, and redundant array of independent disks controllers and adapter. The Industrial & Other segment offers optocouplers, industrial fiber optics, motion control encoders and subsystems, and light emitting diodes.

Its products are used in various applications, including enterprise and data center networking, home connectivity, factory automation, power generation and alternative energy systems, and electronic displays. Broadcom Inc. is based in San Jose, California. – Yahoo Finance