Broadcom Ltd. (NASDAQ: AVGO) reported Q2 EPS of $3.69, $0.19 better than the analyst estimate of $3.50. Revenue for the quarter came in at $4.2 billion versus the consensus estimate of $4.11 billion.
Third Quarter Fiscal Year 2017 Business Outlook
Based on current business trends and conditions, the outlook for continuing operations for the third quarter of fiscal year 2017, ending July 30, 2017, is expected to be as follows:
| | | GAAP | | Reconciling Items | | Non-GAAP |
| Net revenue | | $4,445M +/- $75M | | $5M | | $4,450M +/- $75M |
| Gross margin | | 48.0% +/- 1% | | $680M | | 63.0% +/- 1% |
| Operating expenses | | $1,497M | | $710M | | $787M |
| Interest expense and other | | $100M | | — | | $100M |
| Provision for income taxes | | $78M | | $8M | | $86M |
| Diluted share count | | 444M | | 12M | | 456M |
| | | | | | | |
- Non-GAAP net revenue includes $5 million of licensing revenue not included in GAAP revenue, as a result of the effects of purchase accounting for acquisitions;
- Non-GAAP gross margin includes the effects of $5 million of licensing revenue, and excludes the effects of $653 million of amortization of acquisition-related intangible assets, $18 million of share-based compensation expense, $3 million of charges related to inventory step-up to fair value and $1 million of restructuring charges;
- Non-GAAP operating expenses exclude $441 million of amortization of acquisition-related intangible assets, $237 million of share-based compensation expense, $25 million of acquisition-related costs, and $7 million of restructuring charges;
- Non-GAAP tax provision is $8 million higher than GAAP due to the tax effects of the projected reconciling items noted above; and
- Non-GAAP diluted share count excludes the impact of share-based compensation expense expected to be incurred in future periods and not yet recognized in the Company’s financial statements, which would otherwise be assumed to be used to repurchase shares under the GAAP treasury stock method.
For earnings history and earnings-related data on Broadcom Ltd. (AVGO) click here.
