Shares of Broadcom (AVGO) are up 8% after the microchip and semiconductor company
reported strong financial results and said it has secured $10 billion U.S. in orders from a new mystery client.
The company reported earnings per share of $1.69 U.S. versus $1.65 U.S. that had been expected on Wall Street.
Revenue in the period totaled $15.96 billion U.S., which topped analysts’ consensus estimate of $15.83 billion U.S. Sales were up 22% from a year ago.
In terms of guidance, Broadcom said it expects $17.4 billion U.S. in current quarter revenue, higher than the $17.02 billion U.S. that was anticipated on Wall Street.
Broadcom develops custom chips for Google parent company Alphabet (GOOGL) and other cloud computing companies.
Management announced earlier this year that the company is developing new artificial intelligence (A.I.) microchips with three large cloud customers.
On the company’s latest earnings call with analysts and media, Broadcom executives said they’ve secured $10 billion U.S. in orders for custom A.I. chips from a new fourth customer that they refused to name.
News of the big order, coupled with the strong print, has Broadcom’s stock higher in premarket trading on Sept. 5.
Broadcom said its revenue from A.I. chips rose 63% during the most recent quarter to $5.2 billion U.S., beating the company’s prior forecast of $5.1 billion U.S.
A.I. revenue is forecast by Broadcom to reach $6.2 billion U.S. this quarter.
Prior to today (Sept. 5), AVGO stock had gained 32% this year to trade at $306.10 U.S. per share.
