Broadcom Inc. is a prominent global player in the semiconductor and infrastructure software sectors. Founded in 1961, the company has significantly expanded through various mergers and acquisitions, including its notable integration with Avago Technologies and the former Broadcom Corporation. Headquartered in Palo Alto, California, Broadcom serves diverse markets such as data centers, networking, software, broadband, wireless, storage, and industrial sectors, providing essential technology solutions that drive modern IT environments.
Known for its innovation and engineering prowess, Broadcom delivers critical technologies that support many of the world’s leading companies. Also, he company’s portfolio includes a broad range of products that facilitate connectivity and communication across different industries. Recent strategic acquisitions, such as VMware in 2023, have bolstered Broadcom’s market position, reinforcing its reputation as a leader in technological advancements and industry solutions.
Broadcom Fiscal Q4 2024
Broadcom (AVGO) reported a revenue of $14,054 million, marking a 51% yearly increase, slightly missing the forecasted revenue. However, the company’s EPS exceeded expectations. Also, for Q1 2025, Broadcom projects a revenue growth of 22% year-over-year, driven by strong demand for its AI chips.
Highlights of Broadcom’s Q4 earnings:
- Revenue: Broadcom reported a revenue of $14,054 million for Q4 2024, a 51% increase from the prior year period.
- Net Income: GAAP net income was $4,324 million, while non-GAAP net income was $6,965 million.
- Adjusted EBITDA: Adjusted EBITDA was $9,089 million, representing 65% of revenue.
- Earnings Per Share (EPS): GAAP diluted EPS was $0.90, and non-GAAP diluted EPS was $1.42.
- Free Cash Flow: Cash from operations was $5,604 million, resulting in $5,482 million of free cash flow after capital expenditures.
- Dividend: The quarterly common stock dividend was increased by 11% to $0.59 per share.
Fiscal Year 2024 Highlights:
Broadcom Inc. sets a record revenue of $51.6 billion for fiscal year 2024, marking a 44% increase year-over-year. Also, the company’s infrastructure software revenue grew to $21.5 billion, driven by the successful integration of VMware.
Moreover, semiconductor revenue reached a record $30.1 billion, with AI revenue surging by 220% to $12.2 billion. Meanwhile, adjusted EBITDA for the year increased by 37% to $31.9 billion, and free cash flow excluding restructuring was strong at $21.9 billion. Broadcom also returned a record $22 billion in cash to shareholders through dividends, buybacks, and eliminations.
Guidance Q1 2025:
- Projected Revenue: Approximately $14.6 billion, a 22% increase year-over-year.
- Projected EPS: Broadcom expects the earnings per share (EPS) to be around $1.45.
Board Statements
Hock Tan, President and CEO: Broadcom’s fiscal year 2024 revenue grew 44% year-over-year to a record $51.6 billion, as infrastructure software revenue grew to $21.5 billion, on the successful integration of VMware. Semiconductor revenue was a record $30.1 billion driven by AI revenue of $12.2 billion. AI revenue which grew 220% year-on-year was driven by our leading AI XPUs and Ethernet networking portfolio.
Kirsten Spears, CFO: In fiscal year 2024 adjusted EBITDA increased 37% year-over-year to a record $31.9 billion, and free cash flow excluding restructuring was strong at $21.9 billion. Based on increased cash flows in fiscal year 2024, we are increasing our quarterly common stock dividend by 11% to $0.59 per share for fiscal year 2025. The target fiscal year 2025 annual common stock dividend of $2.36 per share is a record, and the fourteenth consecutive increase in annual dividends since we initiated dividends in fiscal 2011.
Impact on the Stock Market
Broadcom’s Q4 2024 earnings report and Q1 2025 guidance have had a significant impact on the stock market. Following the announcement, Broadcom’s shares (AVGO) surged by 14% in after-hours trading. Investors reacted positively to the company’s optimistic revenue growth projection of 22% year-over-year for Q1 2025, driven by strong demand for its custom AI chips.
Also, analysts have raised their price targets for Broadcom, reflecting confidence in the company’s growth potential, especially in the AI sector.
Broadcom (AVGO) surpassed its significant resistance level with this earnings release.
