Broadcom Inc. posted stronger-than-expected quarterly results and issued an upbeat revenue forecast, with the stock rising around 5% in extended trading on Wednesday (Thursday AEDT).
The United States-based chip designer reported fiscal first-quarter revenue of US$19.31 billion for the period ending 1 February, up 29% from a year earlier, with adjusted earnings per share of $2.05, which was a beat against LSEG consensus forecasts.
Net income rose to $7.35 billion, or $1.50 per share, from $5.50 billion, or $1.14 per share, a year earlier.
CEO Hock Tan attributed the 106% (US$8.4 billion) year-on-year AI revenue surge to demand for custom AI accelerators and networking silicon.
The company expects AI semiconductor revenue of $10.7 billion in the current quarter.
Broadcom forecast second-quarter revenue of about $22 billion, ahead of the $20.56 billion consensus compiled by LSEG, and flagged an adjusted profit margin of 68%, above the 66% expected by analysts surveyed by StreetAccount.
The board also authorised up to $10 billion in additional share buybacks through 2026.
Semiconductor solutions revenue came in at $12.52 billion, beating StreetAccount estimates of $12.25 billion, while infrastructure software revenue of $6.80 billion fell short of the $7.02 billion consensus.
The company plays a critical role in translating chip designs from major technology groups into manufacturable silicon, supplying intellectual property and backend technologies before production at foundries such as Taiwan Semiconductor Manufacturing Company.
That position has strengthened as cloud providers, including Amazon, Alphabet, Meta and Microsoft, design custom AI chips to manage escalating compute costs.
Broadcom last month said it expected to sell at least one million chips by 2027 based on its stacked design technology, signalling a multi-year pipeline.
Broadcom is a major holding in global equity indices tracked by domestic superannuation funds, and its performance feeds directly into returns for millions of members.
In December, Tan disclosed that AI start-up Anthropic had placed a $10 billion custom chip order.
U.S. Defence Secretary Pete Hegseth last week labelled Anthropic a potential “supply chain risk to national security”, and President Donald Trump directed federal agencies to halt use of its systems after the company declined certain defence applications.
Broadcom Inc. (NASDAQ: AVGO) shares closed Wednesday's session 1.2% higher at $317.53 before rallying 5% to $333.05 in after-hours trade. Its market cap is $1.51 trillion.
