Broadcom Faces Pressure Despite Strong AI Revenue Outlook

GuruFocus09-06

The demand for AI surged in Q3 (Jul), boosting Broadcom's (AVGO, Financial) FY24 (Oct) AI revenue outlook. However, non-AI semiconductor revenue remained a drag, impacting the company's overall sales ...

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However, non-AI semiconductor revenue remained a drag, impacting the company's overall sales ...</p>\n\n<a href=\"https://www.gurufocus.com/news/2518321/broadcom-faces-pressure-despite-strong-ai-revenue-outlook\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"AVGO","symbol_name":"博通","start_time":0,"source_url":"https://www.gurufocus.com/news/2518321/broadcom-faces-pressure-despite-strong-ai-revenue-outlook","article_id":"2465644739","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2465644739","pubTimestamp":1725636653,"sourceInfo":{"source_id":"gurufocus_highlight","name":"GuruFocus"},"weMediaInfo":null,"summary":"The demand for AI surged in Q3 (Jul), boosting Broadcom's (AVGO, Financial) FY24 (Oct) AI revenue outlook. However, non-AI semiconductor revenue remained a drag, impacting the company's overall sales ","collect":0,"end_time":0,"defaultTopTitle":"gurufocus.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"AVGO":"博通","AVGOP":"BROADCOM INC PFD SER A 22"},"translate_title":"尽管人工智能收入前景强劲，博通仍面临压力","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"AVGO":1,"AVGOP":1},"content_text":"The demand for AI surged in Q3 (Jul), boosting Broadcom's (AVGO, Financial) FY24 (Oct) AI revenue outlook. However, non-AI semiconductor revenue remained a drag, impacting the company's overall sales forecast for Q4 and causing shares to fall sharply.AVGO's softer-than-expected Q4 revenue guide of approximately $14.0 billion, which still represented over a +50% improvement year-over-year, overshadowed an otherwise strong quarterly report. AI demand lifted AVGO's FY24 AI revenue guidance by $1.0 billion to $12.0 billion. VMware continues to deliver significant benefits. CEO Hock Tan noted that non-AI product revenues have stabilized, with some businesses already recovering and others expected to recover in 2025.Q3 earnings and revenue were solid, with a nearly 18% year-over-year increase in net income to $1.24 per share (AVGO implemented a 10-for-1 stock split) and a 47% jump in revenue to $13.07 billion, accelerating from +43% in Q2 and +34% in Q1. VMware contributed $3.8 billion to AVGO's $5.8 billion software revenues in the quarter, a 200% increase year-over-year. Bookings accelerated, leading to a 32% improvement in annualized booking value compared to the previous quarter. AVGO is reducing costs in VMware, aiming to meet or exceed its adjusted EBITDA target of $8.5 billion by next year. AI demand remained strong, with a 43% increase in networking revenues to over $7.0 billion. Hyperscalers like Amazon, Microsoft, and Google continued investing in AI technology, purchasing AI networking and custom AI accelerator products, which grew by 3.5x year-over-year. Ethernet switching products saw a 4.0x increase, and PCI Express Switches more than doubled. Non-AI products in AVGO's networking division fell by 41% year-over-year but climbed by 17% sequentially, indicating strong recovery dynamics. AVGO expects further sequential growth in Q4, reducing the year-over-year decline to around 30%. Other businesses showed similar trends. Server storage revenue fell by 25% year-over-year but rose 5% from Q2 and is expected to maintain this momentum in Q4. Wireless revenue, mainly from Apple (AAPL, Financial), grew by 1% year-over-year and 6% sequentially. With new iPhones launching in Q4, AVGO anticipates a 20% sequential revenue increase. Broadband remained weak, plunging by 49% year-over-year, but AVGO expects a recovery in 2025.AVGO's downbeat Q4 revenue projection is causing a significant pullback. However, positive factors such as recovering non-AI revenue and growing AI revenue suggest strong long-term potential.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"Business Data","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.26.4","shortVersion":"4.26.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2465644739"}