Broadcom (AVGO) Q3 2024 Earnings Call Transcript

Motley Fool Transcribing, The Motley Fool

Wed, January 7, 2026 astatine 8:46 AM CST 37 min read

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Thursday, September 5, 2024 astatine 5:00 p.m. ET

• President and Chief Executive Officer — Hock Tan

• Chief Financial Officer — Kirsten Spears

• Vice President of Investor Relations — Ji Yoo

Hock Tan: Thank you, Ji, and convey you, everyone for joining america today. In our fiscal Q3 2024, consolidated nett gross of $13.1 cardinal was up 47% year-on-year, and operating nett was up 44% year-on-year. These beardown results reflected 3 cardinal factors: one, AI gross continues to turn and turn strongly; two, VMware bookings proceed to accelerate; and three, non-AI semiconductor gross has stabilized. Before I springiness you much colour connected our 2 reporting segments, fto maine springiness you a speedy update connected guidance. Now we started the twelvemonth providing yearly guidance with quarterly updates arsenic we tally the process of integrating VMware.

Things are present overmuch much unchangeable and we are successful the archetypal -- sorry, and we're successful the last 4th of 2024. So alternatively of giving you yearly guidance, we present revert to providing the quarterly guidance for Q4. Starting with software. In Q3, infrastructure bundle conception gross of $5.8 cardinal was up 200% year-on-year driven by $3.8 cardinal successful gross publication from VMware. The translation of the concern exemplary of VMware continues to advancement precise well. In fact, past week, we held a well-attended VMware Explore Conference successful Las Vegas, our archetypal arsenic a combined company.

This lawsuit was each astir promoting VMware Cloud Foundation, oregon VCF, which is the afloat bundle stack that virtualizes an full information halfway and creates a backstage unreality situation on-prem for enterprises. The occurrence of this strategy is reflected successful our show successful fiscal Q3. We booked much than 15 cardinal CPU costs of VCF, representing implicit 80% of the full VMware products we booked during the quarter. And this translates into an annualized booking value, oregon ABV arsenic I had described before, of $2.5 cardinal during Q3, up 32% from the preceding quarter. Meanwhile, we proceed to thrust down costs successful VMware. We brought VMware spending down to $1.3 cardinal successful Q3 from $1.6 cardinal successful Q2.

And erstwhile we acquired VMware, our people was to present adjusted EBITDA of $8.5 cardinal wrong 3 years of the acquisition. We are good connected the way to achieving oregon adjacent exceeding this EBITDA extremity successful the adjacent fiscal '25. Now turning to semiconductors. In networking, Q3 gross of $4 cardinal grew 43% year-on-year, representing 55% of semiconductor revenue. This was again driven by beardown request from hyperscalers for some AI networking and connected customized AI accelerators. As you know, our hyperscale customers proceed to standard up and standard retired their AI clusters. Custom AI accelerators grew 3.5 times year-on-year.