Broadcom performed higher by growing data center demand

On last Thursday, Broadcom Inc. has announced its quarterly results for the first quarter fiscal 2019.

For profit and revenue, Broadcom remain successful to beat analyst’s expectations, driven by the strong demand of its networking products and enterprise storages from data centers, which raise the price of its share by 5 percent in after trading hours on announcement day.

To the last year’s net income of $532 million, Broadcom’s net income for the fourth quarter ended Nov 4, remain $1.12 billion or $2.64 per share whereas rose to $5.44 billion at the rate of 12.4 percent, which the analysts were expecting to be $5.39 billion.

With the better-than-expected forecast for the full-year revenue, Broadcom reported to remain stick with its quarterly guidance announced earlier.

During the post-earning call, responding to a question of an analyst, CEO Hock Tan stated their expectations for the reported quarter to be “okay”.

To the wireless business of Broadcom, that provides chips for smartphones including iPhones for Apple Inc., management has saw a temporary downward trend as earlier in last couple of months, Apple, due to lowering demand of its new iPhones, has suggested many of its suppliers to slice their forecasts for December quarters.

Earlier this year, in the quest of cooling semiconductor cycle in order to diversify its revenue flow and after unsuccessful efforts of buying Qualcomm, Broadcom has acquired software developer CA Technologies for a price worth $19 billion.

An analyst at Summit Insights Group, Kinngai Chan, has credited the lower operating expenses and better product mix being the major factors towards Broadcom’s beating results.

Wireless communication business of making WiFi chips and RF filters for smartphones has added a share of $1.7 billion, 31 percent to Broadcom’s total sales for the reported quarter, though above the earlier expectations but down by 5 percent from a year ago share of it.

Infrastructure software and semiconductor solutions will become the primary business segments of Broadcom, as company is intending so in days ahead.

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Maria Wiggins

Written by Maria Wiggins

Maria Wiggins:- News Stories
I am Maria Wiggins and I have over 11 years experience in the Technology industry giving me a vast understanding of how news affects the financial markets. I am an active day trader spending the majority of my time analyzing earnings reports and watching commodities and derivatives. I have a Masters Degree in Economics from Westminster University with previous roles counting Investment Banking.

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