Broadcom Inc. now thinks that AI will bring in $12 billion this year, but that bigger prediction wasn’t enough to make shares go up in late Thursday trading.
Broadcom AVGO -0.84% missed its overall revenue estimate for the current quarter by a small amount, which caused shares to drop more than 3% during the extended session.
Broadcom had previously predicted that AI would bring in more than $11 billion.
Head of the company, Hock Tan, said in a statement that Ethernet networking and custom processors for AI data centers will help AI grow.
Broadcom made $13.07 billion in sales in the third quarter of its fiscal year, which is 47% more than the same time last year when the VMware deal that closed in November is taken into account. If you take out Broadcom, sales grew by 4%. Analysts that FactSet kept track of thought it would be $12.98 billion.
Tan said, “We are still making great progress with VMware’s transformation.”
Broadcom made $7.27 billion from semiconductor solutions in the last quarter, up 5% from the same time last year. The FactSet estimate was for $7.42 billion. The deal with VMware helped infrastructure solutions bring in $5.80 billion in sales, which is 200% more than the $5.52 billion that FactSet predicted.
The company that makes semiconductors and software had a net loss of $1.88 billion, or 40 cents per share. This is down from $3.30 billion, or 77 cents per share, in the same quarter last year. When everything was taken into account, Broadcom made $1.24 a share, while experts were expecting $1.22 a share.
Most people think Broadcom will make $14.1 billion in its fiscal fourth quarter, but the company only expects $14 billion. For the whole year, the company thinks that adjusted earnings before interest, taxes, depreciation, and amortization will be 64% of sales.
