Broadcom stock reacts to earnings release

Broadcom (AVGO) stock rose more than 10% early today, a day after the company reported its fiscal 2019 first-quarter[1.ended February 3] results. It maintained its fiscal 2019 outlook. After Broadcom’s last earnings release on December 6, its stock rose ~14% in a week on the company’s strong fiscal 2019 guidance and 50% jump in dividends.

Broadcom Sustains Fiscal 2019 Guidance, Stock Rises ~10%

Broadcom’s fiscal 2019 first-quarter highlights

In fiscal 2019’s first quarter, Broadcom’s revenue rose 8.8% YoY (year-over-year) and 6.5% sequentially to $5.8 billion, missing analysts’ reduced revenue estimate of $5.84 billion. The revenue growth came as sharp declines in Broadcom’s wireless and enterprise storage businesses were more than offset by double-digit YoY growth in its networking business and the addition of CA Technologies, which brought in quarterly revenue of $1.4 billion.

Broadcom’s non-GAAP operating margin expanded 450 basis points YoY to 52.7% in the first quarter of fiscal 2019. Its FCF (free cash flow) rose 39% YoY to $2.03 billion, or 35% of its revenue.

Broadcom’s fiscal 2019 guidance

Broadcom stopped giving quarterly earnings guidance in fiscal 2019. However, it retained its fiscal 2019 revenue guidance at $24.5 billion and FCF guidance at $10 billion.

During Broadcom’s fiscal 2019 first-quarter earnings call, CEO Hock Tan stated that he expects the semiconductor business to bottom out in the second quarter of fiscal 2019 due to weak smartphone demand. He expects growth to return in the third quarter, driven by new product launches in the wireless and networking markets and recovery in the broadband market. Broadcom’s guidance sent peer stocks Skyworks Solutions (SWKS) and Microchip Technology (MCHP) up 3.9% and 3.2%, respectively.

Check out all the data we have added to our quote pages. Now you can get a valuation snapshot, earnings and revenue estimates, and historical data as well as dividend info. Take a look!

Latest articles

The future of the T-Mobile and Sprint merger remains unclear. Several state attorneys and Democratic senators have come together to oppose it.

According to President Trump, the US economy is “poised for big growth after trade deals are completed.” Markets are volatile amid the trade war.

Canopy Growth didn't impress investors with its earnings for the first quarter of 2020. The stock has fallen 12.4% since the company's earnings.

President Trump finally seems to acknowledge how the US-China trade war could impact tech giant Apple. Trump met with Apple CEO Tim Cook at a dinner.

As of August 13, HEXO (HEXO) was trading at 6.51 Canadian dollars—a fall of 30.9% since its third-quarter earnings on June 12.

On August 15, in an interview with CNBC, Mark Zandi said that the trade war hurts the US economy. The trade war has a negative impact on certain sectors.