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Will Higher Semiconductor Revenues Help AVGO Beat Q4 Earnings?

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Broadcom’s (AVGO - Free Report) fourth-quarter fiscal 2024 results, set to be reported on Dec. 12, are expected to reflect the benefits of expanding Artificial Intelligence (AI) and Generative AI offerings.

AVGO’s Semiconductor segment revenues are expected to have benefited from strong demand for custom AI accelerators, AI networking solutions, Ethernet switching, optical lasers, thin dies, PCI Express switches and Network Interface Cards from hyperscale customers. 

The Zacks Consensus Estimate for Broadcom’s fiscal fourth-quarter Semiconductor revenues is pegged at $7.995 billion, indicating growth of 9.1% year over year.

We believe higher Semiconductor revenues will help AVGO shares to move higher post fourth-quarter fiscal 2024 earnings release. AVGO currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
 

Broadcom Inc. Revenue (TTM)

Broadcom Inc. Revenue (TTM)

Broadcom Inc. revenue-ttm | Broadcom Inc. Quote

Click here to learn how AVGO’s overall fiscal fourth-quarter performance is likely to be.

Strong Clientele, Rich Partner Base Aids AVGO’s Q4 Results

A solid portfolio is helping AVGO expand its clientele, which includes Alphabet (GOOGL - Free Report) and Meta Platforms (META - Free Report) . 

Alphabet is one of the largest customers of Broadcom’s application-specific integrated chips (ASICs). These chips are designed to support AI and machine learning and make these tasks more efficient. Meta Platforms has also become an important customer as it is using AVGO’s ASICs to develop Metaverse hardware.

Its strong partner base, including Comcast (CMCSA - Free Report) , Charter Communications, Microsoft, Arista Networks, Dell Technologies, Juniper and Supermicro, has been a key catalyst.

Broadcom is collaborating with Comcast and Charter to develop Unified DOCSIS chipsets for network nodes, smart amps and cable modems. This will enable both FDX and ESD versions of the DOCSIS 4.0 specification to deliver upward of 25 Gbps speeds over existing networks.

In the to-be-reported quarter, Broadcom and Deutsche Telekom subsidiary T-Systems expanded their long-term partnership. T-Systems is now a VMware Cloud Service Provider Pinnacle tier partner.

What Do AVGO’s Q4 Estimates Say?

The Zacks Consensus Estimate for fiscal fourth-quarter earnings is pegged at $1.39 per share, unchanged over the past 30 days, indicating 25.23% year-over-year growth. 

Broadcom’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 3.28%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

For fourth-quarter fiscal 2024, Broadcom expects revenues of approximately $14 billion. The consensus estimate for fiscal fourth-quarter revenues is currently pegged at $14.06 billion, indicating growth of 51.29% from the figure reported in the year-ago quarter.

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