Broadcom earnings beat on strong demand for enterprise storage products

Broadcom earnings beat on strong demand for enterprise storage products

Broadcom Inc on Thursday reported fourth-quarter revenue and profit above analysts' estimates, driven by strong demand for its enterprise storage and networking products, sending its shares up 6 percent in extended trading.

A sign to the campus offices of chip maker Broadcom Ltd, who announced on Monday an unsolicited bid
A sign to the campus offices of chip maker Broadcom Ltd, is shown in Irvine, California, U.S., November 6, 2017. REUTERS/Mike Blake

REUTERS: Broadcom Inc on Thursday reported fourth-quarter revenue and profit above analysts' estimates, driven by strong demand for its enterprise storage and networking products, sending its shares up 6 percent in extended trading.

The chipmaker also forecast full-year 2019 revenue of US$24.50 billion, above analysts' estimates of US$22.40 billion, according to IBES data from Refinitiv.

Broadcom's upbeat results came in contrast to other Apple Inc suppliers, which have cut their forecasts, suggesting tepid demand for new iPhones.

"Looking forward to fiscal year 2019, we expect another year of double-digit revenue growth," Broadcom Chief Executive Officer Hock Tan said in a statement.

"Sustained demand within our semiconductor segment will be augmented by the newly acquired mainframe and enterprise software businesses to our infrastructure software segment."

The chipmaker acquired software maker CA Technologies for US$19 billion earlier this year, aiming to diversify its revenue stream in the wake of a cooling semiconductor cycle. The move came after it failed to buy Qualcomm Inc in the biggest-ever technology deal.

Net income attributable to ordinary shares rose to US$1.12 billion, or US$2.64 per share, in the fourth quarter ended Nov. 4, from US$532 million, or US$1.25 per share, a year earlier.

Excluding items, the company earned US$5.85 per share.

Net revenue rose 12.4 percent to US$5.44 billion.

Analysts on average were expecting earnings of US$5.58 per share on revenue of US$5.39 billion.

(Reporting by Sonam Rai in Bengaluru; Editing by Anil D'Silva and Shailesh Kuber)

Source: Reuters

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