Broadcom shares rally on strong earnings, rising dividends, and buyout plan

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Broadcom

Shares rose late Thursday after the chip and software company posted better-than-expected results for its fiscal fourth quarter ended Oct. 31, provided strong guidance for the January quarter, increased its dividend and announced a new share buyback program.

For the quarter, Broadcom (ticker: AVGO) reported revenue of $ 7.41 billion, up 15%, and slightly above Wall Street analysts’ consensus forecast of $ 7.36 billion . Non-GAAP earnings were $ 7.81 per share, beating the consensus of $ 7.74 per share. According to generally accepted accounting principles, the company earned $ 4.45 per share.

The company said revenue from its semiconductor business was $ 5.6 billion, up 17% from the previous year. Software revenue was $ 1.8 billion, up 8%.

For the January quarter, Broadcom is forecasting revenue of $ 7.6 billion, up 14%, and well above Street’s old consensus forecast of $ 7.3 billion.

The company said it recorded a record Adjusted EBITDA, or earnings before interest, taxes, depreciation and amortization, margins of 60% – and a forecast Adjusted EBITDA margin for the January quarter of 61.5%.

Broadcom also increased its quarterly dividend to $ 4.10 per share, up 14% from $ 3.60 previously. And the company announced a new $ 10 billion share buyback program.

“Broadcom ended the year with record fourth quarter results thanks to a business rebound and continued strength in demand from service providers and the cloud. The growth of our infrastructure software continues to be consistent with our focus on strategic customers, ”CEO Hock Tan said in a statement. “Thanks to the strength and breadth of our intellectual property portfolio, we continue to be able to uniquely deliver cutting-edge and best-in-class semiconductor solutions, and to extend our leadership across our franchise markets. “

At the end of the session, Broadcom shares were up 6.6% to $ 621.81.

Write to Eric J. Savitz at [email protected]


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