Broadcom Inc. (NASDAQ:AVGO)

The financial data reveals significant fluctuations in Broadcom Inc.'s profitability and earnings performance over the six-year period analyzed. Various key metrics, including net income, earnings before tax (EBT), earnings before interest and tax (EBIT), and earnings before interest, tax, depreciation, and amortization (EBITDA), show distinct patterns that merit discussion.

Net Income

Net income experienced robust growth from 2020 through 2023, rising from 2,960 million US dollars to 14,082 million US dollars. This growth reversed sharply in 2024, where net income declined substantially to 5,895 million US dollars. However, a notable recovery occurred in 2025, with net income reaching a new peak of 23,126 million US dollars. The volatility in net income during the latter years suggests the influence of extraordinary factors or varying operational performance within these periods.

Earnings Before Tax (EBT)

EBT followed a similar trajectory to net income, showing a pronounced increase from 2,443 million US dollars in 2020 to 15,097 million US dollars in 2023. It then declined to 9,916 million US dollars in 2024 before rebounding to 22,729 million US dollars in 2025. This pattern indicates that pre-tax profitability was impacted by the same dynamics affecting net income, with a temporary dip followed by substantial growth.

Earnings Before Interest and Tax (EBIT)

EBIT exhibited consistent growth from 4,220 million US dollars in 2020 to 16,719 million US dollars in 2023. Unlike net income and EBT, EBIT did not fall below the 2023 level in 2024 but instead decreased moderately to 13,869 million US dollars. In 2025, EBIT surged to a record 25,939 million US dollars. This suggests improvements in core operational profitability, albeit with some variability possibly linked to changes in cost management or other operating expenses.

Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)

EBITDA consistently increased each year, advancing from 11,125 million US dollars in 2020 to 20,554 million US dollars in 2023 and further to 23,879 million US dollars in 2024. The largest reported figure was recorded in 2025, amounting to 34,714 million US dollars. The steadily rising EBITDA underscores ongoing improvements in operational cash flow and core earnings capacity, reflecting an expanding business scale and potentially effective cost controls before non-cash expenses.

Overall, the data illustrates strong growth in Broadcom Inc.'s earnings at various levels, with an interruption in 2024 marked by declines in net income, EBT, and a slight reduction in EBIT, but not in EBITDA. The marked recovery in 2025 and the new highs achieved in most metrics suggest a resilient operational model and robust earnings recovery capacity. This analysis indicates that despite periodic dips, the company’s earnings trajectory remains positive over the medium term.

The financial data reveals significant trends in the enterprise value (EV), EBITDA, and the EV/EBITDA ratio over the observed periods.

Enterprise Value (EV)

The enterprise value shows a consistent upward trajectory throughout the periods. Starting at US$210.2 billion, it increased to nearly US$289.7 billion the following year. After a slight decline to approximately US$259.4 billion in the subsequent year, there was a marked surge to US$543.0 billion, continuing a steep rise to over US$1.09 trillion and further to approximately US$1.61 trillion at the end of the last reported period. This pattern indicates substantial growth in the company's market valuation, particularly prominent in the last three years.

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)

EBITDA demonstrates a steady and strong growth, rising from US$11.1 billion initially to nearly US$14.7 billion the following year. It continued to grow to US$19.2 billion and then to US$20.6 billion, followed by increases to US$23.9 billion and finally culminating at US$34.7 billion in the last period analyzed. The consistent increase in EBITDA highlights improving operating profitability and effective earnings generation capacity over the years.

EV/EBITDA Ratio

The EV/EBITDA ratio exhibits considerable volatility. It started at 18.89, slightly increasing to 19.72 in the next period, which aligns with moderate market valuation relative to earnings. This was followed by a notable decrease to 13.54, suggesting a more favorable valuation in relation to earnings during that period. Subsequently, the ratio escalated sharply to 26.42, then surged dramatically to 45.78 and further to 46.47 in the final period. Such an increase indicates that the market value has outpaced earnings growth significantly, possibly reflecting heightened investor expectations or market exuberance in recent years.

In summary, the company has experienced robust growth in both enterprise value and EBITDA, signaling strong financial performance and expanding market capitalization. However, the rising EV/EBITDA ratio in the latter years suggests increased valuation multiples, which may point to growing market optimism or a shift in investor sentiment relative to earnings growth.