Broadcom will release its financial report, with the focus on AI chips. Will it exceed expectations like Nvidia?
According to Wall Street, Broadcom's revenue in the first quarter is expected to reach $8.7 billion, an increase of about 7% year-on-year, with adjusted earnings per share of $10.12.
As the leader of the chip industry, Broadcom will release its first quarter financial report after the US stock market tonight.
Of course, investors are most concerned about the latest progress of its business in artificial intelligence.
Broadcom's stock price has risen 41% in the past 12 months, while the Philadelphia Semiconductor Index (SOXX) has only risen 13%.
First Quarter Financial Report Expectations
Some of Broadcom's chips involve generative artificial intelligence systems, which are a hot investment theme this year.
Broadcom's semiconductors involve multiple fields, including networks, broadband, server storage, wireless, and industrial.
Due to the wide range of its terminal market, it can be regarded as an indicator of other parts of the industry.
Wall Street expects Broadcom's revenue in the first quarter to reach $8.7 billion, a year-on-year increase of about 7%, and adjusted earnings per share of $10.12.
For the second quarter guidance, analysts expect Broadcom's revenue to be $8.72 billion and adjusted earnings per share to be $10.17.
Raising Broadcom's Target Price
Earlier this week, KeyBanc Capital Markets analyst John Vinh raised Broadcom's stock target price from $720 to $820 and maintained a "buy" rating.
The analyst said he expects Broadcom's performance to be in line with or slightly higher than expected. He also stated that investors will focus on the company's backlog of chip orders in the field of artificial intelligence.
Vinh wrote: "Although there are signs of normalization in the supply, the coverage of the backlog and the still long delivery time are expected to support Broadcom's performance/prospects, plus generative artificial intelligence, and the renewal of the long-term agreement with Apple."
During the financial report conference call, Broadcom may also share more details about its agreement with Apple suppliers.
Last week, Apple announced a new multi-year, multi-billion dollar agreement with Broadcom to jointly produce 5G radio frequency components and wireless chips.
