Broadcom report

Broadcom, which supplies its chips to Apple, on Thursday reported revenue growth well below the industry average (e.g. AMD). Broadcom gives a good outlook but says it is deliberately restraining the pace of sales.

Chip maker Broadcom (AVGO) yesterday released its fiscal third quarter report and gave its outlook for the fourth quarter of 2021, with revenues and profits better than average Wall Street analysts' estimates.

Shares in Broadcom, up 12.3 per cent since the start of the year, were little changed after the report.

One of the world's largest chip makers, Broadcom reported third-quarter revenue growth of 16% compared with the same quarter last year. According to Broadcom's quarterly sales revenue statistics, the company is increasing sales at a small pace (second quarter revenue growth of +15%), which is very different from the growth "boom" among other chipmakers.

For example, AMD (AMD) reported sales revenue growth of 99% in the second quarter, while Nvidia (NVDA) reported revenue growth of 68% in the same quarter. AMD and Nvidia's year-to-date share gains of 19% and 71.55% respectively also outpaced those of Broadcom.

The semiconductor makers' market capitalisation (as of Tuesday's close of trading) was Broadcom at $197.7bn, AMD at $127.5bn and Nvidia at $545.85bn.

With a customer as big as Apple (AAPL), Broadcom is also benefiting from sales of wireless chips for the latest 5G iPhones.

In addition, Broadcom also has a growing business in software for mainframe infrastructure, data centres and cybersecurity.

Broadcom's Q3 FY2021 earnings and revenue report

Earnings rose 29% to $6.96 per share, higher than the $6.88 forecast by market analysts. Quarterly earnings rose to $1.88 billion, up from a profit of $688 million last year. Revenues rose 16% to $6.78 billion, which also beat analyst estimates of $6.76 billion. Broadcom's quarterly revenue and earnings statistics.

Chip sales rose 19% to $5.02 billion in revenue.

Infrastructure software segment sales grew 10% to $1.76 billion, accounting for 26% of all sales.

Broadcom's cash balance and free cash flow increased compared to last year.