Broadcom reported fiscal fourth quarter earnings and revenue that edged by Wall Street consensus estimates. The company said it expects to hit $50 billion in fiscal 2024 revenue for AVGO stock, including recently acquired software maker VMware.
The San Jose, Calif.-based chipmaker and infrastructure software provider reported fiscal Q4 results after the market close on Thursday.
For the quarter ending Oct. 31, Broadcom earnings rose 6% to $11.06 per share on an adjusted basis. Revenue climbed 4% to $9.29 billion.
Analysts polled by FactSet called for Broadcom earnings of $10.96 a share on sales of $9.28 billion.
On the stock market today, AVGO stock rose a fraction to near 923 in early trading.
AVGO Stock: Fiscal 2024 Targets
"The acquisition of VMware is transformational," Broadcom Chief Executive Hock Tan said in the earnings release. "In fiscal year 2024 we expect semiconductor to sustain its mid to high single digit revenue growth rate, with the contribution of VMware driving consolidated revenue to $50 billion and adjusted EBITDA (earnings before interest, taxes depreciation and amortization) to $30 billion."
Broadcom's 2023 revenue rose 8% to $35.82 billion. VMware had revenue of $13.61 billion in the twelve months ending Aug. 4, growing 3.5%. Broadcom's 2024 guidance of $50 billion in combined revenue didn't raise the bar much for Wall Street analysts.
Heading into the Broadcom earnings report, AVGO stock had jumped 62% in 2023.
Palo Alto, Calif.-based VMware provides cloud computing management and networking software.
"Management believes VMware can grow at a double-digit pace for the next 3 years as the company looks to upsell its complete suite of virtualization software to large customers who are currently purchasing point solutions," said Raymond James analyst Srini Pajjuri in a report. "While the strategy appears to make sense, we are unsure how quickly customers will switch over, especially in light of aggressive cost cuts."
AVGO stock holds an entry point of 923.67, according to IBD MarketSmith charts. Broadcom stock owns a Relative Strength Rating of 93 out of a best-possible 99.
Follow Reinhardt Krause on X, formerly called Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
