Broadcom Q4 Earnings Preview: Will the company continue its streak of beating estimates?

Broadcom (NASDAQ:AVGO) is set to announce its fourth quarter earnings results on Thursday, December 12th, after the closing bell, with analysts expecting a positive growth driven by a recovery in the non-AI semiconductor business.

Wall Street expects Broadcom (AVGO) to report earnings per share of $1.39, an 87.4% decline from last year, on a revenue of $14.06B, a 51.2% increase from last year.

Citi reiterated its Buy rating and upped its price target on the semiconductor and software giant on Tuesday, ahead of its fiscal fourth-quarter results.

“We expect the company to report results above consensus, driven by a recovery in the non-AI semiconductor business with a better-than-feared gross margin outlook due to higher software mix,” analyst Christopher Danely wrote in a note to clients.

J.P. Morgan also believes that Broadcom (AVGO) will beat fourth quarter estimates, but expects lower revenue guidance for the next quarter due to more seasonal trends in its core semiconductor businesses.

“Overall for FY25, we do not see any revenue risk, and in fact expect revenue/EPS upside for the full year, and expect continued strong demand for its AI products,” JPM analysts wrote in a note to clients.

Broadcom (AVGO) has a history of beating estimates, exceeding both revenue and EPS expectations 100% of the time in the last two years.

Broadcom’s AI-centric focus has paid off this year, with shares up more than 58% so far this year, outperforming the broader S&P 500 Index which has risen 26%.

Over the last three months, there have been some revisions to the estimates, with seven upward and two downward revisions to EPS estimates, and six upward and two downward revisions to revenue estimates.

Broadcom disappointed investors last quarter after offering a weaker-than-expected forecast for the fourth quarter. The company expects revenue to be $14B, and adjusted EBITDA to be around 64% of total revenue, for the fourth quarter.