Broadcom Inc. Q1 FY2024 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Q1 FY2024 revenue was $12 billion, up 34% year-over-year. Excluding VMware, revenue grew 11% year-over-year.
  • VMware added 10.5 weeks of contribution, driving a major uplift in software revenue.
  • Semiconductor Solutions revenue grew 4% year-over-year to $7.4 billion.
  • Infrastructure Software revenue surged 153% year-over-year to $4.6 billion, driven largely by VMware.
  • AI-related semiconductor revenue quadrupled year-over-year to $2.3 billion.
  • Broadcom reiterated full-year guidance of $50 billion in consolidated revenue and 60% adjusted EBITDA margin.

Software Segment Highlights

  • Software revenue: $4.6 billion, up 156% year-over-year.
  • VMware contributed $2.1 billion in the partial quarter.
  • Bookings increased from under $600 million last quarter to $1.8 billion in Q1 and are expected to exceed $3 billion in Q2.
  • Management expects VMware revenue to grow double digits sequentially through FY2024.
  • Broadcom targets $20 billion in FY2024 software revenue, driven by VMware Cloud Foundation (VCF) adoption.
  • VCF demand is supported by customers deploying private cloud and on-prem AI workloads.

Semiconductor Segment Highlights

  • Networking revenue: $3.3 billion, up 46% year-over-year due to strong demand for custom AI accelerators and 800G Tomahawk 5 switches.

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Operator: Hello, and welcome to Broadcom's Inc. First Quarter Fiscal Year 2024 Financial Results Conference Call. At this time, for opening remarks and introductions, I will turn the call over to Ji Yoo, Head of Investor Relations of Broadcom Inc. You may begin. Ji Yoo: Thank you, operator, and good afternoon, everyone. Joining me on today's call are Hock Tan, President and CEO; Kirsten Spears, Chief Financial Officer; and Charlie Kawwas, President, Semiconductor Solutions Group. Broadcom distributed a press release and financial tables after the market closed, describing our financial performance for the first quarter of fiscal year 2024. If you did not receive a copy, you may obtain the information from the Investors section of Broadcom's website at broadcom.com. This conference call is being webcast live and an audio replay of the call can be accessed for one year through the Investors section of Broadcom's website. During the prepared comments, Hock and Kirsten will be providing details of our first quarter fiscal year 2024 results, guidance for our fiscal year 2024 as well as commentary regarding the business environment. We'll take questions after the end of our prepared comments. Please refer to our press release today and our recent filings with the SEC for information on the specific risk factors that could cause our actual results to differ materially from the forward-looking statements made on this call. In addition to U.S. GAAP reporting, Broadcom reports certain

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