12.4 billion! Broadcom's revenue surged 43%
On June 13, Broadcom, a major network chip manufacturer, announced its financial report for the second quarter of fiscal year 2024 (ending May 5, 2024), with revenue increasing 43% year-on-year to $12.487 billion, higher than the average analyst expectation of $12.1 billion, and a surge of 43% compared with the same period last year.
In the second quarter, the semiconductor solutions division's revenue increased 6% year-on-year to $7.202 billion, and the infrastructure software division's revenue increased 175% year-on-year to $5.285 billion. In addition, AI product revenue reached a record $3.1 billion, and its chip customization division also attracted orders from large cloud service providers (CSPs) who hope to reduce their dependence on Nvidia. As more and more companies adopt VMware software stacks to build their own private clouds, infrastructure software revenue is accelerating.
Broadcom expects full-year revenue of approximately $51 billion in 2024, including revenue contributed by the previously acquired VMware, higher than the previous forecast of $50 billion. According to LSEG data, the average analyst estimate is $50.42 billion. In addition, Broadcom raised its full-year core profit forecast, exceeding analyst forecasts.
Broadcom CEO Hock Tan said that software revenue from the acquisition of VMware also boosted performance under the stimulation of the AI boom. Tan emphasized that the company is actively seeing strong demand for customized ASIC chips in the Ethernet and AI fields from hyperscale data centers.
Hock Tan emphasized in a statement that Broadcom's extremely strong performance in the second fiscal quarter was once again driven by the explosive demand for artificial intelligence and VMware software focused on artificial intelligence virtual clouds. Hock Tan said, "Next year, we expect most large-scale AI GPU deployments to be based on Ethernet. We expect the strong momentum of AI to continue." Hock Tan said at the earnings conference.
Tan predicts that the total revenue scale related to artificial intelligence will exceed US$11 billion for the full year of fiscal 2024. Broadcom's non-artificial intelligence chip business revenue, which has been sluggish in recent years, also bottomed out in the second fiscal quarter. He said in a conference call with analysts that the second half of fiscal 2024 may show a mild recovery trend.
In the global AI wave, many data center suppliers rely on Broadcom's customized chip designs and network semiconductors to build artificial intelligence systems. Broadcom's collaboration with Google is particularly noteworthy. Broadcom has been a partner of Google's AI processor chips since Google released the first generation of TPU in 2016. Broadcom has also collaborated with other technology giants such as Meta to jointly design AI training processors.
