Findings: Broadcom's CEO sees “sustained” demand from telecommunications and cloud suppliers, with company gross sales choosing up in 2022

Broadcom Inc. shares fell in Thursday's expanded session after the chip and software company reported quarterly results and an outlook that confirmed Wall Street's estimates, saying there was continued strong demand from telecommunications and cloud Sellers sees.

Stocks fluctuated between gains and losses after hours and were last down 0.6% after falling 0.3% in regular trading hours to close at $ 491.90.

Speaking to analysts on the phone, Hock Tan, President and CEO of Broadcom, said that chip demand from telecommunications and cloud service providers is "going well, pretty tough, and it looks like it will be sustained".

Broadcom forecast fourth quarter revenue of around $ 7.35 billion, while analysts had estimated revenue of $ 7.23 billion.

"They seem to stay where we are," said Tan. "And in terms of business, it's pretty much what we alluded to earlier and continue to see what is a continuous path of improving demand, spending, and demand, and we're seeing that continue to improve and grow over the next quarter – in the coming quarter, Q4 and beyond. "

"In fact, I'd say the growth engine for our semiconductor business in 2022 will likely be corporate spending," Hock told analysts.

However, regarding the factory's capacity, Tan said Broadcom would get through but hinted that it could be better. Broadcom uses third party fabs like Taiwan Semiconductor Manufacturing Co.
+ 0.27%,
that recently said it would raise its prices.

"As for our 2022 capacity, I think we have pretty good supply availability for 2022 and we're pretty fine with that," Tan said. "I wouldn't say great, but all in all we feel very good in this environment."

The company reported net income of $ 1.88 billion, or $ 4.20 per share, for the third quarter, compared to $ 688 million or $ 1.45 per share for the same period last year. Adjusted earnings, excluding stock-based payments and other items, were $ 6.96 per share, compared to $ 5.40 per share for the year-ago quarter.

Revenue rose to $ 6.78 billion from $ 5.82 billion in the year-ago quarter. Analysts surveyed by FactSet had expected earnings of $ 6.88 per share on revenue of $ 6.76 billion, based on Broadcom's projected revenue of approximately $ 6.75 billion.

The company reported a 19% increase in chip sales to $ 5.02 billion from the same period last year and a 10% increase in infrastructure software sales to $ 1.76 billion. Analysts had forecast chip sales of $ 5.06 billion and infrastructure software sales of $ 1.67 billion.

Over the past 12 months, Broadcom's shares are up 31%. This compares to both the S&P 500 Index
+ 0.28%
and the technology-heavy Nasdaq Composite Index
+ 0.14%
up 27% while the PHLX Semiconductor Index
+ 0.33%
has gained 44% during this time.

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