Quick overview

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Broadcom posted an impressive earnings result, but shares were muted in Thursday’s extended trading. Broadcom beat forecasts for its fiscal third-quarter earnings and gave strong guidance for the current quarter.

The tech company stated that it anticipates fourth-quarter revenue of $17.4 billion, higher than the $17.02 billion that Wall Street analysts had predicted. The third quarter’s revenue increased by 22% YoY.

The company recorded a net loss of $1.88 billion last year, but this year, it reported net income of $4.14 billion, or 85 cents per share. and other cloud service providers, as well as the networking components and software required to connect thousands of AI chips.

Broadcom’s stock has nearly doubled over the past 12 months, pushing its market cap above $1.04 trillion, and its shares are up 32% for the year. Investors are optimistic that the company’s proprietary chips could challenge Nvidia’s dominance in the AI chip market

Hock Tan, the CEO of Broadcom, stated in March that the company was collaborating with three major cloud clients to develop new AI chips and expects its AI growth to continue into next year. Tan credited the company’s proprietary AI accelerators, networking components, and VMware software for its third-quarter revenue growth.

AI revenue rose 63% to $52 billion, surpassing the company’s previous forecast of $51 billion. The company reported that its chip sales, classified as semiconductor solutions, grew 57% to $9.17 billion. Additionally, Broadcom’s infrastructure software division, which includes VMware, saw revenue increase 43% to $6.79 billion.