Broadcom (AVGO) reported second quarter adjusted earnings of $1.58 per share compared to the Bloomberg consensus estimate of $1.56. Adjusted net revenue was $15.0 billion, which was about in line with expectations. The chip giant's outlook for revenue and AI semiconductor revenue was slightly better than expected. In the video above, CFRA Research senior equity analyst Angelo Zino shares his take on the results and why he thinks the stock is a buy.
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00:00 Speaker A
Taking a look at Broadcom shares, the company's second quarter results just hit in the wire here, uh, Q2 adjusted EPS comes in at 158, the street was at 156. Revenues 15 billion, consensus was 14.96 billion. And turning to the guide, Julie, they're seeing they they're calling for it looks like Q3 revenue of about 15.8 billion. Analysts had been looking for 15.72 billion, they at least initially here the stock's had about 2%.
00:44 Julie Hyman
Yeah, I mean, keep in mind where we have been for this stock, right? It closed at a record high yesterday and it really has been in many investors' minds, the other chip AI play besides Nvidia, Broadcom increasingly making, um, chips, custom, uh, AI chips for other companies as well. So that's been a big part of their business and it's expected to grow more. Hock Tan, the CEO saying in the statement, we expect growth in AI semiconductor revenue to accelerate to 5.11 billion dollars in the third quarter delivering 10 consecutive quarters of growth as our hyperscale partners continue to invest. So this is something that investors are still going to look to them for, but um, perhaps right now you're not seeing like huge jaw-dropping increases, perhaps that wouldn't justify the gains that we've seen.
02:12 Speaker A
Yeah, they're calling for Q3 AI semiconductor revenue here, 5.1 billion, street was at 4.79 billion. Also the stock, I mean keep heading into this print it was up about 15% this year, it was up around nearly 90% of the past 12 months. So expectations high into this one.
02:33 Julie Hyman
Right.
