Broadcom saw its shares move higher in the Friday trading session. It happened as the semiconductor manufacturer shared its earnings for the fourth quarter. The firm reported strong-than-expected earnings.
As the company generated stronger-than-expected gains in the fourth quarter, it was welcomed by investors with open arms.
With the trust level rising in the company’s future performance, the investors started to invest in the company. The positive sentiments of the investors in favor of Broadcom helped boost its share prices.
In addition to sharing above expectation earnings, Broadcom has also shared a very strong outlook in the near term.
The company is witnessing a great expansion in IT and broadband infrastructure. The company had decided that it will be investing huge resources in expanding the IT and broadband businesses.
Broadcom’s Earnings for Q4
Broadcom has revealed that for the fourth quarter, the analysts had sided with an earnings forecast of $10.28 per share. However, their efforts saw the company bringing in earnings worth $10.45 per share.
Having generated 17 cents more than the expected earnings, the company has delivered a very strong performance in terms of earnings.
The revenue Broadcom reported for the fourth quarter was worth $10.8053 while the analysts’ expectations stood at $8.93. The company has generated 21% more revenue than the expected figure.
Compared to the past year’s fourth quarter, the revenue the broadband segment has generated in the recent fourth quarter is 20% higher.
Compared to the third quarter, the broadband segment’s revenue has slipped from the $1.1 billion mark. The wireless services revenue for Broadcom has recorded a significant surge and it is all thanks to Apple.
Broadcom has a strong relationship with Apple and the tech giant asks for its services whenever needed.
Apple benefited from Broadcom in the fourth quarter which also helped the latter bring in a $2.1 billion revenue for the wireless segment. The year-over-year scale shows that wireless revenue has surged by 13%.
Fiscal Year Earnings
A look at the fiscal year earnings of Broadcom shows that the adjusted earnings that the company has generated are $5.94 per share.
This is the latest data for Broadcom and includes information from the current quarter as well. On the other hand, the revenue figures have remained flat compared to the prior $8.9 billion revenue.
Remarks by Hock Tan
Hock Tan, the CEO at Broadcom talked about the growth of the company and its business. He praised that the hyper-scale spending has continued growing aggressively.
Both the current and the previous quarters have shown them that spending is constantly rising. Therefore, it is important that they continue benefiting from the market sentiments to grow their business.
Tan added that their business has continued growing because the deployment of broadband technology is taking place throughout the world.
He specifically talked about the countries in Asia, Europe, and the North American region that are constantly advancing in the adoption of broadband technologies.
They are constantly expanding their business and network because enterprise consumption has continued surging across the board.
Their business has continued growing for years and they are confident that they will continue gathering strong results for multiple years as well.
Positive Prediction by Hock Tan
Hock Tan stated that they cannot make predictions about the growth of their company for several years. However, they can make predictions that the next several months would be bright for their company.
Customer spending has been rising in the utilization of their services and products. They are confident that the same trend will continue for the next several months.
However, they do not know if they will be able to sustain the same levels of provisioning in the upcoming years.
He also highlighted that there are possibilities that people may no longer be used to broadband technologies in years to come.
After talking about the company’s current performance and future expectations, the company’s shares surged by 3.3%.