Broadcom Inc (NASDAQ:AVGO), a global technology leader that designs, develops and supplies semiconductor and infrastructure software solutions, stock fell 8.71% (As on September 6, 12:12:02 AM UTC-4, Source: Google Finance) after the company forecast fourth-quarter revenue slightly below Wall Street expectations on Thursday, hurt by sluggish spending in its broadband segment. Broadcom posted a loss of $1.88 billion on a GAAP basis, compared with a profit of $3.30 billion a year ago. The net loss includes a one-time discrete non-cash tax provision of $4.5 billion, resulting from an intra-group transfer of certain intellectual property rights to the United States as part of a supply chain realignment. Adjusted EBITDA increased 42% year-over-year to $8.2 billion. Free cash flow, excluding restructuring and integration in the quarter, was $5.3 billion, up 14% year-over-year. During the third fiscal quarter, the Company generated $4,963 million in cash from operations and spent $172 million on capital expenditures. The Company paid $1,350 million of withholding taxes related to net settled equity awards that vested in the quarter (resulting in the elimination of 8.4 million shares). The Company’s cash and cash equivalents at the end of the fiscal quarter were $9,952 million, compared to $9,809 million at the end of the prior quarter
AVGO in the third quarter of FY 24 has reported the adjusted earnings per share of $1.24, beating the analysts’ estimates for the adjusted earnings per share of $1.21. The company had reported the adjusted revenue growth of 47 percent to $13.07 billion in .the third quarter of FY 24, beating the analysts’ estimates for revenue of $12.97 billion. The company’s infrastructure software revenue tripled in the third quarter, primarily due to VMware’s contribution, indicating its push into enterprise software was paying off.
Additionally, On June 28, 2024, the Company paid a cash dividend on a split adjusted basis of $0.525 per share, totaling $2,452 million. On July 12, 2024, the Company completed a ten-for-one forward stock split.
Broadcom expects revenue to be of around $14 billion, while analysts polled by LSEG expected $14.04 billion.
The company raised its forecast for annual AI revenue to $12 billion, up from its earlier expectation of $11 billion, as it benefits from the demand for its custom chips and AI networking equipment. It also raised its full-year revenue forecast to $51.5 billion from its prior expectation of $51 billion.