Broadcom Inc. saw a 3% decrease in its shares during the extended session on Thursday following a revenue forecast for the current quarter that did not meet expectations. The chip and software company reported a net income of $3.30 billion, or $7.74 per share, for the fiscal third-quarter, compared to $3.07 billion, or $7.15 per share, in the year-ago period.
Adjusted earnings per share came in at $10.54, up from $9.73 in the same quarter last year, surpassing analysts' expectations of $10.43 per share. Revenue rose to $8.88 billion from $8.46 billion in the year-ago quarter, slightly exceeding analysts' estimates of $8.85 billion.
Solid Chip and Software Sales Drive Growth
Chip sales increased by 5% to $6.94 billion compared to the previous year, while infrastructure software sales also saw a 5% boost to $1.94 billion. These strong results were primarily attributed to the growing demand for next-generation networking technologies among hyperscale customers who are expanding and networking their AI clusters within data centers.
During the third quarter, Broadcom achieved $4.6 billion in free cash flow. Looking ahead, the company has forecasted fiscal fourth-quarter revenue of approximately $9.27 billion, aligning with analysts' consensus.
Steady Climb for Broadcom's Stock
Year to date, Broadcom's stock has experienced an impressive 65% increase, outperforming the PHLX Semiconductor Index SOX (+45%), the S&P 500 index SPX (+18%), and the tech-heavy Nasdaq Composite COMP (+35%).
In related news, Intel offers an optimistic update, sending its stock on an upward trajectory. Meanwhile, Nutanix's stock jumps 12% following a revenue beat and strong sales guidance.