Broadcom: Fiscal 2Q20 Financial Results
In server storage connectivity 14% sequential revenue decline, but demand in 3FQ20 accelerating
This is a Press Release edited by StorageNewsletter.com on June 8, 2020 at 2:22 pm| (in $ million) | 2Q19 | 2Q20 | 6 mo. 19 | 6 mo. 20 |
| Revenue | 5,517 | 5,742 | 11,306 | 11,600 |
| Growth | 4% | 3% | ||
| Net income (loss) | 691 | 563 | 1,162 | 948 |
Broadcom Inc. reported financial results for its second quarter of fiscal year 2020, ended May 3, 2020.
“Second quarter results were in-line with our expectations, and saw limited impact from the effects of Covid-19,” said Hock Tan, president and CEO. “Looking ahead, our third quarter guidance for semiconductors reflects a surge in demand from cloud, telecom and enterprise customers, offset by supply chain constraints and an expected substantial reset in wireless. We remain focused on investing in our diverse set of mission critical semiconductor and software franchises, while carefully managing our expenses in this uncertain environment.“
“We generated record quarterly free cash flow of over $3 billion and reinforced our balance sheet, ending the quarter with over $9 billion of cash,” said Tom Krause, CFO. “Given our strong free cash flow gen, healthy balance sheet and enhanced liquidity position, we remain committed to maintaining our dividend while we navigate these unprecedented times.”
The company’s cash and cash equivalents at the end of 2FQ20 were $9,207 million, compared to $6,444 million at the end of the prior quarter.
During 2FQ20, the company generated $3,213 million in cash from operations and spent $148 million on capital expenditures.
On March 31, 2020, the company paid a cash dividend of $3.25 per share of common stock, totaling $1,306 million and a cash dividend of $20.00 per share of mandatory convertible preferred stock, totaling $75 million.
3FQ20 Outlook
Based on current business trends and conditions, the outlook for the third quarter of fiscal year 2020, ending August 2, 2020, is expected to be as follows:
• Revenue of $5.75 billion plus or minus $150 million; and
• Third quarter Adjusted EBITDA of $3,220 million plus or min$75 million, or 56% of revenue at the midpoint of guidance.
Quarterly Dividends
The board of directors has approved a quarterly cash dividend on its common stock of $3.25 per share. The common stock dividend is payable on June 30, 2020 to common stockholders of record at the close of business on June 22, 2020.
The board has also approved a quarterly cash dividend on its 8.00% Mandatory Convertible Preferred Stock, Series A, of $20.00 per share. This dividend is payable on June 30, 2020 to preferred stockholders of record at the close of business on June 15, 2020.
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