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XBRL · SEC EDGAR2016–2025(10yr)| Metric | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $13.2B | $17.6B | $20.8B | $22.6B | $23.9B | $27.4B | $33.2B | $35.8B | $51.6B | $63.9B | +23.9% |
| Gross Profit | $5.9B | $8.5B | $10.7B | $12.5B | $13.5B | $16.8B | $22.1B | $24.7B | $32.5B | $43.3B | +33.2% |
| Gross Margin | 44.9% | 48.2% | 51.5% | 55.2% | 56.6% | 61.4% | 66.5% | 68.9% | 63.0% | 67.8% | +4.7pp |
| Operating Income | -$409.0M | $2.4B | $5.1B | $3.4B | $4.0B | $8.5B | $14.2B | $16.2B | $13.5B | $25.5B | +89.3% |
| Operating Margin | -3.1% | 13.5% | 24.6% | 15.2% | 16.8% | 31.0% | 42.8% | 45.2% | 26.1% | 39.9% | +13.8pp |
| Net Income | -$1.7B | $1.7B | $12.3B | $2.7B | $3.0B | $6.7B | $11.5B | $14.1B | $5.9B | $23.1B | +292.3% |
| Net Margin | -13.1% | 9.6% | 58.8% | 12.1% | 12.4% | 24.5% | 34.6% | 39.3% | 11.4% | 36.2% | +24.8pp |
| Free Cash Flow | $2.7B | $5.5B | $8.2B | $9.3B | $11.6B | $13.3B | $16.3B | $17.6B | $19.4B | $26.9B | +38.6% |
| FCF Margin | 20.3% | 31.1% | 39.5% | 41.0% | 48.6% | 48.5% | 49.1% | 49.2% | 37.6% | 42.1% | +4.5pp |
| EPS (Diluted) | $-4.86 | $4.02 | $28.44 | $6.43 | $6.33 | $15.00 | $26.53 | $32.98 | $1.23 | $4.77 | +287.8% |
1. THE BIG PICTURE
Broadcom has successfully transformed itself into the essential gatekeeper of the AI era by combining custom silicon design with dominant networking standards. While it maintains a legacy software portfolio, Broadcom’s future is now a high-stakes bet on AI infrastructure, where it is currently outgrowing nearly all large-cap peers while maintaining the highest cash-flow efficiency in the sector.
2. WHERE THE RISKS HIT HARDEST
Broadcom’s "sustained technology leadership" (10-K Item 1) is directly threatened by its manufacturing dependency, as 95% of its wafers are produced by a single foundry, TSMC (Risks). Any geopolitical disruption or capacity shift at TSMC would immediately jeopardize the "time-critical delivery" Broadcom promises its customers (10-K Item 1). Furthermore, Broadcom’s "long-standing collaborative relationships" with major OEMs are a structural vulnerability; because the top five customers account for 40% of revenue, a single customer’s decision to reduce capital expenditures would make it impossible for Broadcom to meet its ambitious $22 billion quarterly revenue guidance (8-K).
3. WHAT THE NUMBERS SAY TOGETHER
The financial data reveals a widening gap between Broadcom’s two worlds: a hyper-growth semiconductor business and a stagnant software arm. In the most recent quarter, semiconductor revenue surged 52%—fueled by a 106% jump in AI-related sales—while infrastructure software grew by only 1% (8-K). This shift makes Broadcom a pure-play AI infrastructure bet rather than a diversified conglomerate. Despite this transition, Broadcom remains the most efficient operator in its peer group, leading with a 36.9% operating margin and a 41.1% free cash flow (FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders) margin (XBRL). The recent quarterly revenue growth of 29% significantly exceeds its trailing twelve-month (TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter) growth of 23.9%, confirming that the AI product cycle is accelerating rather than slowing down. Market sentiment remains steady, with short interest at a negligible 1.2% of the float.
4. IS IT WORTH IT AT THIS PRICE?
At 19.7x Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations, Broadcom trades in line with the peer median of 19.1x, a valuation that appears modest given it is growing nearly three times faster than peers like Oracle or IBM (XBRL). The market is currently pricing in approximately 6.3% long-term growth (CAPM analysis). This is a low bar for a company that just reported $8.4 billion in quarterly AI revenue alone (8-K). However, the valuation is constrained by a $52.6 billion net debt position and 2.2x net leverage (CAPM analysis). If AI demand were to normalize and growth slowed to a base rate of 5.0%, the justified multiple would drop to 15.6x, suggesting the current price relies entirely on maintaining the current AI momentum. Investors are currently compensated for this risk by massive capital returns, including $10.9 billion returned via buybacks and dividends in a single quarter (8-K).
5. WHAT WOULD CHANGE THIS VIEW?
- Cautious if AI revenue growth drops below triple digits, indicating that the "robust demand for custom AI accelerators" (8-K) is hitting a cyclical ceiling.
- Constructive if the infrastructure software segment, particularly VMware Cloud Foundation, begins to show meaningful growth, reducing Broadcom's reliance on volatile semiconductor cycles.
- Cautious if net leverage increases significantly beyond 2.2x, as the existing $67,120 million debt load already limits Broadcom's ability to react to economic downturns (Risks).
6. BOTTOM LINE
Structural Advantage: Broadcom's integration of proprietary custom AI accelerators with industry-standard Ethernet networking creates a high-switching-cost "moat" for data center architecture. Bottom Line: Broadcom is a best-in-class AI powerhouse trading at a fair price, though its extreme supplier and customer concentration requires a high tolerance for volatility.
1. Top 5 Material Risks
- Customer Concentration: Broadcom relies on a small number of end customers, OEMs, and distributors for the majority of its business. Sales to distributors represented 48% of net revenue in fiscal year 2025, while the top five end customers accounted for 40% of net revenue.
- Manufacturing Dependency: Broadcom utilizes a primarily outsourced manufacturing model, with approximately 95% of wafers produced by TSMC during fiscal year 2025. This concentration exposes Broadcom to potential capacity prioritization by the foundry for other customers or sudden price increases.
- Substantial Indebtedness: As of November 2, 2025, Broadcom held $67,120 million in aggregate debt. This leverage limits Broadcom's ability to react to economic changes and requires significant cash flow for debt service.
- Cyclicality and AI Volatility: The semiconductor industry is highly cyclical and currently undergoing rapid change due to AI. If AI customers reduce expansion plans or fail to generate sufficient profit to offset their infrastructure spending, Broadcom’s operating results and stock price could be materially harmed.
- Global Economic and Trade Conditions: Broadcom’s international operations and revenue are subject to geopolitical turmoil, including China-Taiwan relations, and trade tensions. Escalating protectionism or trade restrictions could limit access to markets or suppliers, particularly in China.
2. Company-Specific Risks
- Integration of VMware: The acquisition of VMware introduces risks related to the integration of diverse legacy systems, potential deficiencies in internal controls, and the assumption of liabilities, including potential tax liabilities stemming from VMware’s former ownership by Dell.
- Design Win Unpredictability: The semiconductor business depends on "design wins," which are lengthy, expensive, and unpredictable. Failure to secure a design win for a specific generation can result in lost revenue and weakened positioning for future product cycles.
- Software Lifecycle Management: The growth of the software business depends on the adoption of the data center virtualization portfolio. Failure to manage software lifecycles or maintain compatibility with third-party platforms could lead to customer dissatisfaction and contractual liabilities.
- Key Person Dependency: Broadcom’s success is tied to the contributions of senior management, specifically President and CEO Hock E. Tan, and Broadcom does not maintain key person life insurance.
3. Regulatory/Legal Risks
- Antitrust and Regulatory Inquiries: Broadcom has been and may be subject to regulatory investigations in Japan, Korea, and the European Union regarding contracting and business practices, which could result in fines, disgorgement of profits, or requirements to modify business conduct.
- Export Controls: Broadcom is subject to U.S. Export Administration Regulations and executive orders. The U.S. government’s practice of adding companies to restricted entity lists or prohibiting exports to specific countries limits Broadcom’s ability to sell products and compete effectively.
- Tax Incentives and Global Minimum Tax: Broadcom benefits from tax incentives that reduced the provision for income taxes by $2,709 million in fiscal year 2025. The implementation of a global minimum tax in various countries is expected to materially increase Broadcom's effective tax rate and cash tax costs for the fiscal year ending November 1, 2026.
- IP Litigation: Broadcom is frequently involved in legal proceedings regarding intellectual property. Adverse outcomes could force Broadcom to cease the sale of infringing products, pay substantial damages, or license technology on unfavorable terms.
4. Financial Impact Map
Customer Concentration → Net Revenue → 40% of net revenue derived from top five end customers. Manufacturing Dependency → Gross Margin → 95% of wafers produced by TSMC; potential for price increases or capacity constraints. Substantial Indebtedness → Cash Flow → $67,120 million in debt requires significant portion of cash flow for servicing. Cyclicality and AI Volatility → Operating Results → Potential for reduced demand or credit/default risk from AI customers using alternative financing models. Tax Incentives → Provision for Income Taxes → $2,709 million aggregate reduction in tax provision for fiscal year 2025.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 8-K | Mar 2026 | — |
| 14A | Mar 2026 | — |
| 10-K | Dec 2025 | Nov 2025 |
| 10-Q | Sep 2025 | Aug 2025 |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
Broadcom Q1 Revenue $19.31B +29% YoY, Beats Estimates; EPS $2.05 Beats Forecasts
- ▸Q1 revenue $19.31B, +29% YoY, exceeding $19.18B estimates
- ▸Q1 adjusted EPS $2.05, beating consensus forecasts by $0.02
- ▸Secured $970M five-year DISA blanket purchase agreement with Carahsoft
- ▸BofA raised pro-forma earnings estimates for FY26, FY27, and FY28
- ▸Maintained Strong Buy rating with 61% average upside potential
Broadcom AI chip revenue grows 106% YoY, secures $970M defense software contract
- ▸AI semiconductor revenue grew 106% year-over-year
- ▸Secured five-year, $970 million software agreement with U.S. Department of Defense
- ▸One-year total shareholder return of 85.15%
- ▸Current share price $309.51 vs. estimated fair value of $480
- ▸30-day share price return of 3.14%
Broadcom Q2 Revenue Forecast $22B, AI Revenue Expected to Surge 140% YoY
- ▸Q2 revenue guidance $22B, representing 47% YoY growth
- ▸Q2 AI revenue projected at $10.7B, up 140% YoY
- ▸Q1 fiscal 2026 gross margin 77%, down 210 bps YoY
- ▸Q1 AI revenue surged 106% YoY; custom accelerator revenue +140% YoY
- ▸Q2 semiconductor revenue expected $14.8B, up 76% YoY
Broadcom Q1 revenue $19.3B +29% YoY, AI chip revenue surges 106% to $8.4B
- ▸Q1 revenue $19.3B, up 29% YoY
- ▸GAAP net income $7.3B, up 34% YoY
- ▸AI semiconductor revenue $8.4B, up 106% YoY
- ▸AI chip revenue projected to exceed $100B in 2027
- ▸AI networking revenue up 60% YoY, representing one-third of total AI revenue
Broadcom AI revenue growth signals sustained demand from hyperscalers despite YTD stock decline
- ▸AI-driven revenue growth confirmed from hyperscaler customers
- ▸Broadcom stock down approximately 8% year-to-date
- ▸AI revenue shifting from speculative potential to realized financial results
- ▸Strong demand signals challenge cooling AI market narrative
Broadcom price target raised to $450 on higher custom AI chip shipment forecasts
- ▸GF Securities raised AVGO price target to $450
- ▸Projected 2027 TPU shipments increased to 5.8 million units
- ▸2026 TPU shipments projected at 4.1 million units
- ▸Analyst cites growing external sales momentum for custom AI chips
- ▸Average selling prices expected to trend upward due to complex designs
Broadcom secures $970 million five-year cloud infrastructure contract with DISA
- ▸Secured $970 million five-year contract with Defense Information Systems Agency
- ▸Partnership with Carahsoft to consolidate software procurement for multiple defense agencies
- ▸Contract covers VMware Cloud Foundation, vDefend, and Avi Load Balancer solutions
- ▸Supports U.S. Air Force, Space Force, and Combatant Commands IT modernization
- ▸Enables standardized pricing for private cloud, security, and AI workload deployment
Broadcom Q1 Revenue $19.31B +29.5% YoY, Q2 Revenue Guidance $22B
- ▸Q1 total revenue $19.31B, up 29.5% YoY
- ▸Infrastructure Software revenue $6.8B, up 1% YoY
- ▸VMware revenue grew 13% YoY
- ▸Q1 total contract value bookings exceeded $9.2B
- ▸Q2 revenue guidance $22B, representing 47% YoY growth
Broadcom Q4 Revenue $19.31B +29.5% YoY, AI Segment Revenue Surges 106%
- ▸Q4 revenue $19.31B, up 29.5% YoY, beating estimates by 0.5%
- ▸Q1 AI segment revenue $8.4B, up 106% YoY
- ▸Revenue guidance for next quarter exceeds analyst expectations
- ▸Broadcom stock down 1.4% since earnings report
- ▸Qorvo Q4 revenue $993M, up 8.4% YoY, in-line with estimates
Broadcom Q1 AI Revenue Doubles to $8.4B, Total Revenue Up 29% to $19.31B
- ▸Q1 AI revenue $8.4B, +106% YoY
- ▸Total Q1 revenue $19.31B, +29% YoY
- ▸Diluted EPS $1.50, +32% YoY
- ▸Net profit margin 36.57%
- ▸Secured $21B in custom chip orders from Anthropic