"Broadcom ( Nasdaq: AVGO) reports fiscal Q4 2025 results after the close, with expectations shaped almost entirely by accelerating AI semiconductor demand and steady VMware-driven software growth. The company enters earnings with record backlog and unusually clear visibility into both custom XPU ramps and hyperscale networking cycles. Management's commentary last quarter emphasized a material step-up in AI revenue growth in FY26, raising expectations for forward guidance quality."
"With AI now more than half of semiconductor revenue and VMware stabilizing at high-margin run rates, this quarter will be viewed as a read-through on Broadcom's multiyear AI monetization curve. Consensus implies 23% revenue growth in FY25 and 35.7% growth in FY26, paired with a 39 % EPS increase next year. These expectations assume Broadcom's AI semiconductor revenue continues rising at a 60% plus growth clip while VMware adoption remains strong."
"Hock Tan highlighted $5.2B in Q3 AI semiconductor revenue, up 63 percent YoY, and confirmed that XPUs now represent 65 percent of this segment. Broadcom secured over $10B in AI rack orders from a newly qualified fourth customer, with volume expected to begin meaningfully in FY26. Investors will look for updated guidance on XPU shipment timing and whether the FY26 AI revenue outlook, which management said will "accelerate" from FY25, supports Street estimates."
Broadcom enters fiscal Q4 2025 with record backlog and clear visibility into custom XPU ramps and hyperscale networking cycles. AI now accounts for more than half of semiconductor revenue while VMware stabilizes at high-margin run rates. Consensus expects 23% revenue growth in FY25 and 35.7% in FY26 with a 39% EPS increase, assuming AI semiconductor revenue grows above 60% and VMware adoption remains strong. Broadcom reported $5.2B in Q3 AI semiconductor revenue, XPUs as 65% of that segment, and secured over $10B in AI rack orders from a newly qualified fourth customer. Networking launches like Tomahawk 5/6 and Jericho4 target very large AI clusters.
Read at 24/7 Wall St.
Unable to calculate read time
Collection
[
|
...
]