AVGO Q3 2023 Earnings

Call Details

• Call Title: Broadcom Q3 2023 Earnings Call
• Date: August 31, 2023 9:00 PM UTC
• Management Team:
  • Ji Yu (Head of Investor Relations)
  • Hock Tan (President and Chief Executive Officer)
  • Kirsten Spears (Chief Financial Officer)
  • Charlie Kawas (President, Semiconductor Solutions Group)

Call Summary

Financial Performance

• Consolidated revenue for Q3 was $8.9B, up 5% year-on-year on a non-GAAP basis.
• Semiconductor solutions revenue was $6.9B, representing 78% of total revenue and up 5% year-on-year.
• Infrastructure software revenue was $1.9B, representing 22% of total revenue and up 5% year-on-year.
• Gross margin was 75.1% of revenue (non-GAAP) and adjusted EBITDA was $5.8B or 65% of revenue.
• Semiconductor gross margin was approximately 70%, down 160 basis points year-on-year, and semiconductor operating margin was 59%.
• Free cash flow in the quarter was $4.6B, representing 52% of revenues, and capital expenditures were $122M.

Guidance

• The company provided Q4 consolidated revenue guidance of $9.27B, up 4% year-on-year on a consolidated basis.
• The company expects adjusted EBITDA in Q4 to be approximately 65% of projected revenue.
• The company expects Q4 gross margins to be down 80 basis points sequentially on product mix.
• The Q4 guidance explicitly excludes any contribution from VMware and assumes current business trends and conditions.