Broadcom Inc. Q3 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Broadcom reported Q3 FY2023 revenue of $8.9 billion, up 5% year-over-year.
  • Semiconductor Solutions revenue rose 5% YoY to $6.9 billion.
  • Infrastructure Software revenue rose 5% YoY to $1.9 billion.
  • Hyperscale demand driven by generative AI was the primary growth engine; non-AI semiconductor revenue remained stable at approximately $6 billion per quarter, flat YoY.

Key Business Drivers

  • Networking (AI-driven):
    • Q3 revenue reached $2.8 billion, up 20% YoY, driven by switches, routers, and custom AI compute engines.
    • Networking represented 40% of semiconductor revenue.
    • Demand fueled by hyperscaler buildouts of AI clusters using Broadcom’s Ethernet-based solutions.
    • Company received substantial orders for next-generation Tomahawk 5 (800G) and Jericho3-AI products; shipments expected within six months.
    • Development for Tomahawk 6 (1.6T) already underway.
    • Q4 networking revenue expected to grow in excess of 20% YoY, led by ~50% sequential growth in AI-related demand.
  • Wireless:
    • Q3 revenue: $1.6 billion, flat YoY, up 4% sequentially.

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Operator: Welcome to the Broadcom Inc.'s Third Quarter Fiscal Year 2023 Financial Results Conference Call. At this time, for opening remarks and introductions, I would like to turn the call over to Ji Yoo, Head of Investor Relations of Broadcom Inc. 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 third quarter fiscal year 2023. 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 third quarter fiscal year 2023 results, guidance for our fourth quarter, 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 US GAAP reporting, Broadcom reports certain financial measures

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