Broadcom forecasts upbeat current-quarter sales on 5G ramp up - Reuters

tederes.blogspot.com

The Broadcom Limited company logo is shown outside one of their office complexes in Irvine, California, U.S., March 4, 2021. REUTERS/Mike Blake

Broadcom Inc (AVGO.O) forecast current-quarter revenue above Wall Street expectations on Thursday, as the semiconductor firm is set to benefit from the rising adoption of 5G technology.

As the global rollout of 5G ramps up, strong demand for higher-priced chips used in smartphones will benefit Broadcom, which counts iPhone maker Apple Inc (AAPL.O) as a major customer in its wireless chip division.

The company, which also makes chips for data centers and servers, estimates third-quarter revenue to be about $6.75 billion, exceeding analysts' estimates of $6.6 billion, according to Refinitiv IBES data. The company's fiscal third-quarter estimates typically include ramping up production for the launch of Apple's iPhones in the fall.

Shares were flat after the results.

On a conference call with investors, Chief Executive Hock Tan said demand in the company's wireless segment was higher than expected in the just-ended fiscal second quarter, which could result in less demand in the fiscal third quarter.

He also said that long-term supply contracts such as the one with Apple give Broadcom "the confidence to invest in R&D to make (capital expenditure) capacity investment. And in return, we offer the best leading-edge technology in specific areas in a timely manner to our critical customers."

Broadcom has been working to allocate the chips it can get to end market demand for electronics rather than to customer stockpiling, an effort analysts said seems to be working. "While our industry checks do indicate significant double ordering in Broadcom's supply chain, we think Broadcom's customers are still unable to build much buffer inventory," said Kinngai Chan, an analyst at Summit Insights Group.

Revenue rose to $6.61 billion in the second quarter ended May 2, from $5.74 billion a year earlier. Analysts had expected revenue of $6.51 billion.

The company reported net income of $1.49 billion, or $3.30 per share, in the second quarter, compared with $563 million, or $1.17 per share, a year earlier.

On an adjusted basis, the company earned $6.62 per share, beating estimates of $6.43 per share, according to Refinitiv data.

Our Standards: The Thomson Reuters Trust Principles.

Adblock test (Why?)

"current" - Google News
June 04, 2021 at 11:09AM
https://ift.tt/3uTy3fz

Broadcom forecasts upbeat current-quarter sales on 5G ramp up - Reuters
"current" - Google News
https://ift.tt/3b2HZto
https://ift.tt/3c3RoCk

Bagikan Berita Ini