Broadcom Inc. (NASDAQ:AVGO)

The financial data reveals significant trends and fluctuations across multiple fiscal years. The analysis focuses on revenue segments, cost structures, profitability, and other key financial metrics.

Revenue and Sales Trends

Overall net revenue demonstrates a consistent upward trajectory, rising from approximately $23.9 billion to $63.9 billion over the observed period. The Products segment shows steady growth, accelerating notably in the final year to nearly $44.8 billion. Subscriptions and Services revenue remains relatively stable initially but experiences a dramatic spike in the penultimate year at over $21 billion, before decreasing slightly in the last year to about $19 billion.

Cost of Revenue and Margins

Cost of products sold increases steadily, reflecting growth in the Products revenue but with a somewhat slower rate, which contributes to expanding gross margins. Cost of subscriptions and services remains low initially, but rises sharply in line with the subscription revenue surge, yet proportionally it is lower than the revenue increase. The amortization of acquisition-related intangible assets declines initially but then experiences a large increase in the two most recent years, suggesting substantial acquisitions or intensified amortization expenses. Gross margin expands considerably, growing nearly threefold to $43.3 billion by the end of the period, indicating improved operational leverage.

Operating Expenses

Research and development expenses remain relatively stable in early years, then increase significantly from around $9.3 billion to $11 billion in the latter years, indicating a strategic emphasis on innovation and development. Selling, general and administrative expenses fluctuate, with a sharp increase in the penultimate year followed by a decline. The amortization of acquisition-related intangible assets within operating expenses follows a similar trend to the cost side. Restructuring and other charges vary year to year but show a marked increase in recent years, possibly indicating organizational changes or cost rationalizations. Overall, operating expenses nearly double toward the end of the period.

Profitability and Income Measures

Operating income experiences considerable growth, from about $4 billion to over $25 billion over the period, although there is a noticeable decline in the penultimate year before rebounding. Interest expense increases substantially in the same year, possibly reflecting increased debt or financing costs associated with acquisitions or expansions. Interest income and other income fluctuate but remain relatively minor compared to other components. Income from continuing operations before taxes and net income both demonstrate strong growth, with a dip in the penultimate year but recovery afterward. Provision for income taxes reflects volatility, shifting from minor benefits to significant expenses and then a positive benefit again, indicating changes in tax strategy or tax rates.

Dividends and Earnings Attributable to Common Stock

Dividends on preferred stock cease to be reported in the later years, suggesting changes in capital structure. Net income attributable to common stock follows the net income trend closely, confirming that the majority of earnings belong to common shareholders. An exceptional dip in net income occurs in the penultimate year, likely driven by extraordinary charges or restructuring costs, but it recovers substantially in the final year.