Broadcom beats earnings estimates, announces 10-for-1 stock split

Broadcom posted earnings for the second fiscal quarter on Wednesday that beat analysts' estimates. It also announced a 10-for-1 stock split, set to begin trading on a split-adjusted basis on July 15.

The stock rose about 10% in extended trading.

Here is how the company did versus LSEG consensus estimates for the quarter that ended in May:

The chipmaker expects about $51 billion in sales during its fiscal 2024 year, an increase over the company's previous forecast, and slightly higher than consensus expectations of $50.42 billion.

Broadcom reported $2.12 billion in net income during the quarter, or $4.42 per share, versus $3.48 billion in net income, or $8.15 per share, in the year-ago period.

Broadcom is one of the chipmakers benefiting from the artificial intelligence boom because its devices can run the sorts of AI applications that have enamored the tech industry. Broadcom said $3.1 billion in sales during the quarter could be attributed to revenue from AI products. For example, Broadcom works with Google, which partially designs its own AI chip called a TPU.

"Talking of AI accelerators, you may know our hyperscale customers are accelerating their investments to scale up the performance of these clusters," Broadcom CEO Hock Tan said on the earnings call. "And to that end, we have just been awarded the next-generation custom AI accelerators for these hyperscale customers of ours."

The company also said revenue from VMware, an enterprise software company it acquired for $69 billion late last year, contributed to its sales growth and forecast for the rest of the year.

The company's overall revenue was up 43% on an annual basis during the quarter. Without VMware sales, it would have been up 12% on a year-over-year basis, Broadcom