Broadcom(AVGO) - 2024 Q3 - Quarterly Report

Cash Flow and Dividends - Broadcom generated $4,963 million in cash from operations during the fiscal quarter ended August 4, 2024[96] - The company paid$2,452 million in cash dividends during the same period[96] - Dividends to common stockholders increased to $7,330 million for the three fiscal quarters ended August 4, 2024, compared to$5,741 million in the prior year period[123] - Net cash provided by operating activities increased by $1,101 million to$14,358 million, primarily due to contributions from VMware[125] Acquisitions and Divestitures - Broadcom sold its end-user computing (EUC) business to KKR & Co. Inc. for $3.5 billion[97] - The company acquired VMware for approximately$30,788 million in cash and 544 million shares of Broadcom common stock valued at $53,398 million[98] - Broadcom acquired Seagate's SoC operations for$600 million to strengthen its SoC product portfolio[99] - Net cash used in investing activities increased by $22,373 million to$22,938 million, driven by $25,961 million in cash used for acquisitions, including the VMware Merger and Seagate's SoC operations, partially offset by$3,485 million from the sale of the EUC business[126] Financial Performance - Net revenue for the fiscal quarter ended August 4, 2024 was $13,072 million, with products contributing$7,439 million (57%) and subscriptions/services contributing $5,633 million (43$8,356 million (64% of net revenue)[103] - Operating income for the fiscal quarter ended August 4, 2024 was $3,788 million (29$333 million (5%) in the fiscal quarter and $1,010 million (5$3,863 million (200%) in the fiscal quarter and $9,986 million (176$4,196 million (47%) in the fiscal quarter and $10,996 million (41$8,356 million (64% of net revenue) in the fiscal quarter and $23,507 million (63$2,462 million (170%) in the fiscal quarter and $5,626 million (135$995 million (73%) in the fiscal quarter and $3,211 million (83$712 million (184%) in the fiscal quarter and $2,775 million (236$462 million (132%) in the fiscal quarter and $1,385 million (132$303 million in the fiscal quarter and $1,215 million in the three fiscal quarters ended August 4, 2024, primarily due to employee termination costs from the VMware Merger[112] - Stock-based compensation expense increased to$1,381 million in the fiscal quarter and $4,356 million in the three fiscal quarters ended August 4, 2024, driven by equity awards from the VMware Merger[113] Debt and Financing - The company issued$5.0 billion of senior unsecured notes and used the proceeds, along with the EUC sale proceeds, to repay $9,195 million of its unsecured term A-2 facility[97] - Net cash provided by financing activities increased by$17,396 million to $4,343 million, primarily due to$34,985 million in net proceeds from borrowings, partially offset by increased debt repayments and higher dividend payments[127] - The company had $53.1 billion in fixed-rate senior notes outstanding as of August 4, 2024, with a fair value of$49.2 billion. A hypothetical 50 basis point change in interest rates would impact the fair value by approximately $1.6 billion[129] - The company had$19.2 billion in floating-rate 2023 Term Loans outstanding as of August 4, 2024. A hypothetical 1% change in interest rates would impact interest expense by approximately $194 million over the next 12 months[129] Stock and Equity - Broadcom completed a ten-for-one forward stock split of its common stock[97] - Cash and cash equivalents decreased by$10,879 million, primarily due to $32,058 million paid for the VMware Merger,$7,330 million in dividend payments, $7,176 million in stock repurchases, and$4,012 million in employee withholding tax payments, partially offset by $22,849 million in net proceeds from borrowings and$14,358 million in net cash from operating activities[121] Assets and Liabilities - Trade accounts receivable decreased by $2,060 million, driven by strong collections and additional receivables sold through factoring arrangements[121] - Other current assets decreased by$4,133 million, primarily due to the sale of the EUC business, partially offset by an increase in contract assets[121]