AVGO Q4 2019 Earnings

Call Details

• Call Title: Broadcom Q4 2019 Earnings Call
• Date: December 12, 2019 at 10:00 PM UTC
• Management Team:
  • Beatrice Rosado (Director of Investor Relations)
  • Hock Tan (President and CEO)
  • Tom Krause (Chief Financial Officer)

Call Summary

Financial Performance

• Consolidated net revenue for Q4 was $5.8B, a 6% increase year over year.
• Semiconductor Solutions revenue for Q4 was $4.6B, representing 79% of total revenue and was down 7% year over year and up 5% sequentially.
• Infrastructure Software revenue for Q4 was $1.2B and represented 21% of revenue.
• Fiscal 2019 revenue was $22.6B, up 8% year over year.
• Fiscal 2019 gross margin was a record 71%, up from 67% a year ago, representing a 4 percentage point increase.
• Fiscal 2019 free cash flow was $9.3B, representing 41% of revenue and grew 12.4% year over year.

Guidance

• The company forecasts fiscal 2020 net revenue of approximately $25B, plus or minus $0.5B.
• Semiconductor Solutions revenue for fiscal 2020 is expected to be approximately $18B.
• The core semiconductor business is expected to deliver approximately $12B in revenues in 2020, representing approximately 7% growth compared to 2019.
• Infrastructure software is expected to grow to approximately $7B in fiscal 2020 with Symantec contributing approximately $1.8B of that amount.
• Operating margins and adjusted EBITDA margins are expected to be relatively flat in fiscal 2020 versus fiscal 2019.
• The company is targeting a 55% operating margin by fiscal 2022.