Broadcom(US:AVGO) ZACKSยท2025-09-05 17:51Core Insights - Broadcom (AVGO) reported third-quarter fiscal 2025 non-GAAP earnings of $1.69 per share, exceeding the Zacks Consensus Estimate by 1.81% and increasing 28% year over year [1][8] - Revenues rose 22% year over year to $15.95 billion, also surpassing the Zacks Consensus Estimate by 0.78% [1][8] Financial Performance - AVGO shares increased over 4.6% following the strong third-quarter results, with a year-to-date gain of 32%, compared to a 14.9% increase in the Zacks Computer & Technology sector [2] - Semiconductor solutions revenues, which account for 57.5% of net revenues, reached $9.17 billion, up 26% year over year, driven by AI revenues that surged 63% to $5.2 billion [3][8] - Infrastructure software revenues, making up 42.5% of net revenues, grew 17% year over year to $6.79 billion [4] Operating Metrics - Non-GAAP gross margin was 78%, up 100 basis points year over year, while semiconductor gross margin decreased 30 basis points to 67% [5] - Adjusted EBITDA rose 30% year over year to $10.7 billion, with an adjusted EBITDA margin of 67.1%, up 420 basis points [6] - Non-GAAP operating margin expanded 470 basis points year over year to 65.5% [6] Balance Sheet and Cash Flow - As of August 3, 2025, cash and cash equivalents were $10.72 billion, up from $9.47 billion on May 4, 2025 [7] - Total debt decreased to $64.23 billion from $67.28 billion during the same period [7] - Cash flow from operations was $7.17 billion, compared to $6.56 billion in the previous quarter, with free cash flow at $7.02 billion [9] Future Outlook - For the fourth quarter of fiscal 2025, Broadcom expects revenues of $17.4 billion, indicating 24% year-over-year growth [10] - AI revenues are projected to grow 66% year over year to $6.2 billion, while non-AI semiconductor revenues are expected to grow low double digits sequentially to approximately $4.6 billion [10] - Infrastructure software revenues are anticipated to increase 15% year over year to $6.7 billion [11]