Broadcom late Thursday handily beat estimates for its fiscal fourth quarter and with its guidance for the current period. Broadcom stock initially rose on the news but later turned negative.
The Palo Alto, Calif.-based fabless chipmaker and infrastructure software provider earned an adjusted $1.95 a share on sales of $18.02 billion in the quarter ended Nov. 2. Analysts polled by FactSet had expected earnings of $1.87 a share on sales of $17.47 billion. On a year-over-year basis, Broadcom earnings surged 37% as sales rose 28%.
For the current quarter ending Feb. 1, Broadcom forecast revenue of $19.1 billion, up 28% from the same quarter last year. Wall Street had been modeling $18.38 billion in sales for the fiscal first quarter.
In after-hours trading on the stock market today, Broadcom stock at first rose more than 5% on the news. But in recent trades it was down over 3% to 392. During the regular session Thursday, Broadcom stock fell 1.6% to close at 406.37.
On Wednesday, Broadcom stock notched a regular-session all-time high of 414.61 in intraday trading.
AI semiconductor sales drove the company's outperformance in fiscal Q4, Chief Executive Hock Tan said in a news release. AI chip sales soared 74% year over year in the period, he said.
"We see the momentum continuing in Q1 and expect AI semiconductor revenue to double year-over-year to $8.2 billion, driven by custom AI accelerators and Ethernet AI switches." Tan said.
Broadcom has benefited from strong sales of its custom artificial intelligence chips for Alphabet's (GOOGL) Google, Facebook parent Meta Platforms (META) and others. It also makes networking, switch and router chips for AI data centers.
In other news, Broadcom announced that it is increasing its quarterly dividend by 10% to 65 cents a share in fiscal 2026. The company has now increased dividends for 15 consecutive years.
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