Broadcom (AVGO) 12 Jun 242024 Q2 Earnings call transcript

Welcome to Broadcom Inc.'s Second Quarter Fiscal Year 2024 Financial Results Conference Call. At this time, for opening remarks and introductions, I would like to turn the call over to Ji Yoo, Head of Investor Relations of Broadcom Inc.

Thank you, operator, and good afternoon, everyone.

Joining me on today's call are Hock Tan, President and CEO; Kirsten Spears, Chief Financial Officer; and Charlie Kawwas, President Semiconductor Solutions.

Broadcom distributed a press release and financial tables after the market closed, describing our financial performance for the second quarter of fiscal year 2024.

receive Investors you at section not information obtain broadcom.com. did the from of you a may copy, the If Broadcom's website

replay the Investors This and of Broadcom's be being is section for of audio accessed through conference can the year webcast X website. call call an live,

We'll on recent press could providing prepared on SEC the with as XXXX questions refer the for results, take forward-looking results the During be this our to comments. comments, materially made business information well our cause second of our Please release call. fiscal our today for and Hock differ of that prepared and XXXX our as guidance regarding commentary the to quarter filings specific environment. will year actual factors end the Kirsten risk details fiscal from the after year our statements

measures basis. to tables Comments a today's to financial between GAAP addition measures financial will made In on non-GAAP included GAAP results. certain non-GAAP U.S. A refer press primarily release. reconciliation reports call to today's Broadcom is in non-GAAP our during reporting, and attached the

now the call I'll over Hock. turn to

and Ji, everyone, for thank joining today. you, you, Thank

results, up net from included XXX% $X.X in and growth XX% to sorry, in QX organic revenue, largely was $XX.X if revenue up we enterprises revenue weakness billion, But driven stepped was continued from XX% telcos. revenue this VMware. In fiscal full and quarter year-on-year, our more year-on-year semiconductor than revenue consolidated cyclical AI which billion, offsetting by XX% up was XXXX revenue as contribution year-on-year consolidated a of exclude VMware,

and channel X is up our have billion VMware, from core up In modernized with X,XXX segment disparate infrastructure well. acquired the me from revenue billion the billion going to prior $X.X of Since of eliminating SKUs over contribution year-on-year now revenue simplified QX, on was go-to-market X segments, in a and quarter. reporting beginning very give included the we in software. Let SKUs amount product The more flow, VMware from conflicts. you software $X.X of product XXX% $X.X integration offerings VMware, we huge color

good products billion closing these model. we or them signed virtual We largest booking X,XXX enable annual on-prem. typically deal, in private of an VMware annualized self-service in have sign multiyear subscription in since to up And which as making progress metric, XX,XXX products measure Each customers up transitioning customers ABV. to a licensing value contract, the close a a we actually to to $X.X QX $X.X are normalize to accelerated all cloud known our from build for VMware billion This of ABV, into to QX.

have software Year-to-date, to $X per restructuring about this what billion rate functions. at run to consolidated costs period from be over $X.X For integrated quarter $X.X QX. incurred and we Broadcom same ABV have and pre QX eliminated quarter grew drove Meanwhile, we a spending integration used billion reference, the portfolio, our for $X.X VMware billion acquisition. of redundant in entire billion to billion across SG&A the $X.X from and the in platform

billion We better likely our than expect run spending to $X.X a $X.X billion decline plan at will and billion rate exiting previous stabilize continue towards $X.X QX, integration. will post

XXXX. billion VMware margins expect will per and grew of towards VMware revenue therefore to Broadcom classic towards fiscal to converge operating run in billion, accelerate in by QX QX We was that billion software $X.X for rate. to $X.X begin quarter $X a

Turning semiconductors. to

hyperscalers towards of close data by Tomahawk an with we X This shifting center clusters interesting successfully accelerators. networking. We AI of we demand has that year-on-year, note It's the in was end Dell, number AI doubled continue which again to strong and increasing you QX deployed deploy, give JerichoX, collaboration custom switches more semiconductor from Let particularly mix like for proportion and partners billion been our $X.X Supermicro. of color markets. sold representing revenue XX% of as me Juniper, Networks, revenue Arista Networking, grew networking year-on-year, to driven both by XX% and revenue.

Additionally, we out And next-generation would we NICs drive driving growth and switches the larger DSP, fabric. the data we XXX-gigabit and still. switches, PIN which shipments optics back-end of ecosystem interconnects these with transition We're are the clusters. partners, diodes. in also AI our Express centers leading to the DSPs, AI-accelerated towards connectivity not doubled to lasers, optical our for standing bandwidth, scale PCI are accelerated Together optical same AI that rapid developing X.X-terabit of and is in

In Talking our hyperscale customers to of scale ours. customers today. X hyperscale these the it up we for deepest And Ethernet the their are have of been investments next-generation and workloads what point, Broadcom accelerators accelerators, an we broadest awarded to for of large of Broadcom, of AI performance understanding but the challenging out complex, be these custom that to X very solutions. in AI these accelerating scaled you clusters just fabric. accelerators use takes the today does the in Proof have end, exist largest AI is in may technology AI clusters. AI know deployment Networking

to mega-scale on Next GPU year, be Ethernet. all we expect deployments

to XX% networking to now revenue expect expect that, year-on-year grow continue, guidance the prior in growth. and compared AI XX% because of we our We strength to of over

is guidance revenue. quarter-on-quarter X% flat year-on-year. to with Moving deep, strategic, represents for North all is billion seasonally our grew we of QX 'XX, XX% increases, was $X.X engagement which business. wireless customer, wholly represents semiconductor wireless helped and and XX% consistent multiyear our of our by and revenue wireless essentially down This American content our with continued trend in wireless. fiscal to year-on-year, be of And revenue previous reiterate

on of connectivity was in forecast though, storage revenue And the XX% year-on-year. down revenue modest revenue, bottom storage we the server around the QX updated believe And decline million $XXX our XX% storage. a expect bookings, fiscal was We and Next, accordingly, or the of server recovery half XX% range second QX forecast 'XX in to year-on-year. demand server we semiconductor year. based

declined XX% to broadband. in represented year-on-year semiconductor weak revenue. pause and continued on of QX Broadband Moving million remains service $XXX XX% and telco provider on to the revenue spending.

] revenue decline our (sic) just of from expect in year We with outlook [ the XXXX. guidance bottom for second XX% year-on-year. over Broadcom a half to broadband XXs are for broadband in high the our revising we down fiscal a Accordingly, of 'XX year-on-year to prior be recovery

prior QX single-digit decline. industrial down to be resale resale for rev XX% now declined expect Finally, 'XX, double-digit million guidance we high $XXX industrial to year-on-year of compared our fiscal And for year-on-year. percentage

here's sum to up, we seeing. what all So are it

in its 'XX, and be for revenue semiconductor is X integrating 'XX. On and modestly at all progress we $XX over second billion. to recover strong accelerating much factors fiscal making of $XX growth. infrastructure likely to Pulling from fiscal expect these For we in Non-AI VMware has are half fiscal AI bottomed guidance software, billion. together, raising revenue the our to key we're very QX stronger 'XX revenue

Kirsten. turn And with me to that, call let the over

Thank you, Hock.

XX% which our from $XX.X Let quarter for me quarter, was from QX detail up year a Consolidated of VMware. included financial full a billion ago. provide revenue now contribution the performance, additional on

year-on-year revenue margins was VMware. increased both XX.X% and revenue primarily contribution quarter. Excluding R&D QX of were Gross year-on-year. billion from the billion, of XX% VMware, due up $X.X consolidation the were Operating in the to $X.X expenses

income from and ago XX% was revenue. margin QX year a was with operating billion at $X.X up of operating XX%

$XXX revenue. EBITDA transition operating Excluding up of million billion Adjusted margin XX% XX% revenue. of of excludes $X.X year was ago, costs, of or operating of billion with profit was XX% from figure depreciation. a This $X.X

higher were primarily segment points Now to of the of segments, semiconductors. X% This the for total on down expenses semiconductor segment of operating AI revenue and in approximately driven of Operating year-on-year starting XX%. resulting quarter. a was P&L accelerators. a our basis our increased R&D, up XX% solutions X% million mix for solutions review Gross custom margins increased year-on-year, X semiconductor Revenue in represented semiconductor investment $XXX billion XXX $X.X in year-on-year. was margins XX%, by with our for

for Gross infrastructure quarter, for up software billion $X.X infrastructure resulting year-on-year, in and were were was quarter, on operating the VMware XX%. and software. the $X.X in software XX% moving to due primarily infrastructure in margin contribution Now of expenses of infrastructure represented revenue. Revenue of to the software XXX% margin billion, XX% operating

was operating XX%. margin transition costs, Excluding

on revenues. to flow. $X.X was Free in moving cash flow quarter of the cash XX% Now and represented billion

of and Section cash of Excluding million, acquisition up the due U.S. has the flows expense of and for higher revenue. declined of Free of free debt a $XXX and from XXXX cash income XX% of used represented billion higher to the percentage restructuring higher cash to cash to as $X.X year-on-year in flow reenactment delay a related XX% revenue mix from VMware cash and taxes were due XXX. interest integration

days were quarter inventory quarter, million We spent the on XX XX quarter. days of in outstanding second $XXX Days the capital second billion, consistent ended $X.X expenditures. the X% with sequentially. We first in down with sales

respectively. is coupon X.X X.X second of rate maturity and we our of in and gross $XX and our is on of average our rate in average years, cash billion $X.X coupon to rate fixed how The to with $XX respectively. remain debt. manage disciplined across years weighted ended We continue debt X.X% inventory and maturity quarter years billion We debt and to ecosystem. The weighted the of $XX rate years, floating billion billion X.X%

During we debt, XXXX. to the intend maintain of quarter, this throughout our of and fiscal quarterly we floating repaid $X rate debt billion repayment

second employee stockholders AVGO XX the elimination fully in count we withholding of vesting a to of In $X.X the X.X resulting common taxes XXX stock share million based VMware shares. non-GAAP Turning In paid $X.XX acquisition paid capital equity, quarter. on weighted billion for cash allocation. million QX, quarter, due million We as of on were of share. the the per $X.X diluted in billion in issued shares cash quarterly was dividends the dividend

a accessible announcing stock XX-for-X Today, make of to to more split stock to Broadcom employees. forward of we and are investors Broadcom's ownership stock common

X.XX receive share close of approximately XXXX. XX, QX, of XX, with X shares. market on be a market of Our the on billion on split-adjusted expect trading after shares July of record an after post-split In stockholders to July a commence stock reflecting open close XXXX, we the common expected at on count additional basis, XX, to market July basis will

Now guidance. on to

for and our are year to $XX consolidated billion revenue adjusted XXXX We XX%. EBITDA guidance raising to fiscal

impacted in GAAP fiscal and income acquisition. For are net to integration-related year XXXX in VMware cash cash modeling purposes, flows keep please the that by due restructuring and mind costs

remarks. Operator, please my open call up concludes the That for prepared questions.

our Arya come of America. line first And the Instructions] Bank from question of with Vivek will [Operator

Broadcom the between would and NVIDIA I across switching. emerging Hock, both and appreciate perspective accelerators competition your on Ethernet

the of have many they on the side, launch position custom large the their are very Blackwell that customers in accelerator that compute. to same you So going product a

customers how is. I'm So the that curious you broadly allocation think to do visibility decision, are what just going

of Ethernet then is Broadcom AI And launch that they year? and you for do B side for switch, think increasing as their switching part next competition Spectrum-X that I Ethernet poses in the think

Vivek. question, interesting Very

accelerators, we operating choice and I model about in GPUs, think to that. at which is them very environment effective a merchant different We in with the even is NVIDIA operates we with very, the where different on a start in know is extremely it's not something as AI and least. accelerator think in are of space, model. -- and that don't That's powerful a On are that that we very much scale, a on where respect on something merchant in, -- a to against -- they're good It AI stand the competing manner.

to custom scale for very and selective selected to we're workloads, do AI or use solutions, ASIC accelerator. are we AI there's try accelerators, silicon the very which a those happy IP hyperscalers do our portfolio is particular what AI to to Now skills to create complex if create

do I market. on I'm not. this competing against We're to not them me be So competitor in far truly basically other. trying to see as GPUs say a And to for each myself position

We to a are don't either. them. to competitor be try We not

again, But angle. they different. approaching a may Now different may approaching on and it from networking, that's be people maybe be

through indicated of AI. transitions I as of are, gone very cloud-scale captured networking we now we've as Ethernet and lot a deep to years, and doing a networking. Ethernet for have We lot over transitions, routing we've from all along, in market market XX been Ethernet And

natural a to into go for it's AI. So extension us

we in enable don't trying the We AI the we also end end but We a GPUs, are the in which to GPUs, very that of take that that merchants the that work is those do engine create platform recognize is compute well. being choice probably GPUs very approach they ecosystem, integrated. to to

with and hopefully else, GPUs who anything GPU if and building So we are those clusters. bigger bigger customers supplement complement

come line question of that Deutsche for our with Bank. Ross from will next Seymore One and moment the

theme, split that bit the then want for delineate if offload significantly is could hand-in-hand? kind faster growth side Broadcom you versus Or as realm other, to next-generation in The the full AI side as are of be the the year-over-year, think compute to said that strong XXX% in Hock. And now I on year, the stick Are going between the you going growing the how those I than a especially quarter, with the, well? that's guess, you they one accelerators had about are little connectivity the you well? as growth side? the

closer to completely something hindsight of when cadence like, It's Well, understand really to extent, the question to except deployment AI on well, we predict they in don't in put the it versus X/X answer your very the accelerators when it's really mix, networking. in they head now accelerators, networking. nor some the be XX-XX put because infrastructure and by of the you're right. the networking And close XX% we that running year. X/X It's accelerators, to of XX% together, towards don't quite to it probably will it All know, puts we the used XXX%. understand

And Rasgon come from line One our of question. moment Stacy will that with next for the Bernstein.

guide. to billion $XX wanted ask the I about AI

suggesting You'd feels the like second that. even you it be if to not you didn't to at from It And level you growing. grow me me in $XX.X be the AI you're think like feels current half. could billion

AI that Or be something? It be. wouldn't billion? why lot than $XX.X% number So like ought it I a more to feels missing am

things. rate over what billion, be get a just guided it on $XX could on depends It's lot sometimes of it think depends And I deployment, shipments you lumpy. of Stacy, very -- is. Because quarterly

be So right. you may

I it may do, estimate You better better. the trajectory general but than is getting

Okay.

I that, just than like be would do back how things that of again, levels, -- at are the is suggesting into getting $XX guess you be could just you're suggesting sort half it that worst I So billion are that flat but more the so... better current the also because

Correct.

Okay.

we I'm guess a take So a just if that's that's wrong, I it that, just -- reading conservative very number? that, very

best forecast have Stacy. at the That's I this point,

line Sur of and question, with will come for moment One that from next our the JPMorgan. Harlan

networking Broadcom switching now cadence, introductions, and team to cloud on Hock, good Trident, silicon, Tomahawk, steadily a consistent is routing past AI X increasing. networking driving of has family the Like the right, see been products for clockwork, that mix and the product generations. X-year of Jericho new

their top GPU, that deployments are of customers new and TPU introductions layer You on their accelerating product your of products. of cadence

which introduced clockwork, just your also X right, for And this is adoption introduction, X ahead like Tomahawk there? Jericho look give since if I your Can So historically, competitors. latest Tomahawk curve you X-nanometer maybe then X driving and products? as importantly, to it's next-generation think, years X faster been which back silicon of ready X you've product years and just you have your getting update are means products, us I an introduce puts to you would, Tomahawk

there. insightful 'XX. Yes, pretty you're we Tomahawk launched Harlan, X

So late should yes. the be is out with you're switch, by 'XX, we right, Tomahawk the coming XXX-terabit X, time which

the driving And networking kind GPU of that is is your acceleration cadence this products? by strong and of partners, TPU also the in the what's -- is growth

have a X data targeted clusters, always in regardless, you're X-year out you out Late into a was to after we be AI we're But the what, correct, in shoot things it when have know X let to to has late very time. on. it But fabric with X for need you tremendous its because put and the we Well, so right cadence adoption, AI networking, sometimes the large been centers. it's Tomahawk AI 'XX for take with in should years that, Tomahawk bandwidth ties which it 'XX.

line will One Melius. of from moment come and our that question, the Reitzes with next Ben for

Congrats little guide. about talk I a to on bit the VMware. more wanted quarter and Hock,

willingness clarify to would Cloud move better a And And the color indeed to you little more to also customer Foundation. wanted subscription? how than if characterize Just it on going is expectations. just

price You've seeing beat expectations? and there, are cut you that the

on not Thanks, The is and good pretty it's we're as making -- it's is progress. quarter. much any the thanks far for but concerned, to your as over kind But means, very much regards VMware journey by expectation.

subscription. Moving we're have who to very lot been I subscription, guys, in Salesforce, Microsoft, pretty of in VMware, slow much to, other Oracle, well, compared mean, a already

So you process. by VMware thing right? where you in put on once and as update that is and but It's it trying right because perpetual a your subscription situation versus That's capabilities manner subscription product to like out I to is basis, feature-wise, for week. it update offering in a up compelling a But it, news offering offering, it, continual getting in the a ongoing to on subscription. very basis, compare we're an late very, manner almost it everything your do, patch online make it how a it printed getting

So lot get to want a it's for of very to people interesting on.

to getting no they on are surprise, very so And well.

point, its networking, management, offering stack, and basic now whole compelling self-service very stack this and and Based at selling a customers great on that great trying have, compute That's I big fact on of virtualization. is operation technology for cloud. private use we're The product, it's the data storage, just technology, been fundamental point very create software to are just the to we point, server virtualize to and indicated, out center stuck what attractive but a keep entire or compelling kind price as XX we vSphere price not years. the

right, to compute point have And with the it virtualization. it's saying where comparable for just down thanks we and priced it, you're

hybrid as and private the lot That's who interest deploy up of signed from to the selling interest, that's own customers complement, we're like point, private a cloud nice from getting public on-prem even have deploy getting we our alternative yes, would or ability that. their a a in clouds. attention -- the lot doing So lot of of customers maybe to to a cloud,

Great. And it's reiterated? the on fourth track which billion for still, is $X by quarter

this give quarter. specific towards we $X as it's didn't on I track frame, I? growing time see billion a did Well, a But process

and One line Hari the Toshiya our Sachs. that question, next of will moment come with Goldman for from

software your the to over term, rate I question guess seem to Hock, hitting pretty kind follow-up a medium billion of that into good on run $X you previous the business. perhaps. visibility have

in strategy about to think Broadcom levels. But also talked You and kind still is I how we your should operating margin done not converging business in that paydown the classic mode. know debt you're you integration have of option the enough side or growth VMware? the drive you is your VMware? beyond side beyond about to to think both growth Do and still software on drivers, M&A an semiconductor continue

Interesting question. And right. you're

this As AI quarter even past we're to the I remarks, helping indicated year-on-year. growth of contribution we my in we organic us, VMware, have non-AI semiconductor able XX% where from but without sort out, have show bottoming

so are rush options to who we us Answer to entrusted So open always buy with But say, do value all capital almost is no. the for trying to shareholders have our company? to that. do the to create another need because we're best have

been to has growth again, and really our we acquire much organic organic that fast I to of combination how often because is your as well. determined acquisition, strategy, would but through operate But a So enough grow. improve, would also them market better not invest, to the our by assets long-term on show grow always very discount alternative growth model

then. towards now look do we and So acquisitions

Blayne that with line question, from next of One the and moment for will our Jefferies. Curtis come

think kind the you is business industry AI. ask think ex correction to an the curious, wanted that Obviously, seeing. a I networking I kind it inventory just at there's mentioned of don't of But Hock, was bottom. I whole on you,

recovery. non-AI bottom? perspective, expecting just business overall see I you segment? on think in I should a a said So customer Is year-over-year. you XX% perspective down that Are about just there levels it's inventory any any whole should business that finding semi -- know

enterprise because it storage, obviously, non-AI behaving. We we very to call a anything much else, we half see kind workloads server out and of as hyperscalers to recover which storage see than call at out, I And didn't modestly is particularly though thing of sometimes. those, on combination We call figure to that of year. the the it in who link second networking, it is. networking more hard bottom as server a traditional as But it's it same run well I QX, the it is. their

see we trajectory we So as same storage. are out server on calling the

that UBS. One the come with Arcuri of moment line question, from will and for our next Timothy

spent spend of other there demand heard a I've GPU to you another of way if the networking. you is on think is billion GPU in back to opportunity? compute, Hock, AI that you interest, past networking map need sort your billion which most say $XX I to $XX on

numbers, kind it when sort So for you that will if I'm of there a is the just you? you to back see to be these of use wondering what GPU thumb of big map rule opportunity

goes of go the DSPs, attaches goes diodes into a say just GPU except rest take for if about of value optical to the as creating the such of if though switching, connect. you it's the is that that networking, clustering because in for on interconnects but on PIN optical totally optical so into in part -- complex, there networking almost say connects I for would those every probably stopped components is, a you say, components include But we high-bandwidth networking, XX% itself lasers, -- that would billion it every we one would it, are market, Tim, on of spend you I'm the GPU, and $X probably like to networking. all you spend GPUs, serious. you the But model, that There bunch totality, probably not

deployment way I about the do it to available my don't it components but of I look attached point is to the not connects, never value of the it's XX% we're kind at Now having do talked is I same entirely optical probably is all market. is said the these itself. But precise it. roughly, simple few that the in infrastructure of components way. But never all about that -- GPU that, XX%, maybe

deployment So my way which run of AI or typically, less why revenue mix around, seeing But is going sometimes towards you that see GPU comes later networking earlier, you the and range of much the the you're mix. GPU within other the may purchase time. over on or

moment the One will and O'Malley Barclays. come for Thomas our question, from next line of that with

My Nice with here business. to regards a results. question run a ASIC customer. had of in Hock, long you custom AI the particularly very successful X business,

in look that that's entrant from to you historically, direct of market playing differentiates late? you really different new entrant the a talk If in as I you who's And you But said about could have the new the what market today, with customers. you customer you. know not a

see less questions Can the And you gross there's talk And been more in any you profitability your And of areas defensible of the if any if additional profile of future? would longer you term. or that attack you that see maybe around in about sustainability then if deem really those margins there's kind would entrant today? increased competition?

AI our you can know, Let let large way second from get models. on It me these GPU. run look no big, business. these from run accelerator, AI accelerators part of no as a The a large get run one of models first, computing, which different these these put single is language view. mean, -- very language each -- I a and accelerators, me -- profitable is model point take the AI business, custom examine accelerator

no memory it run, need those and You accelerators the there's way the memory powerful are. But requirements. multiple matter also, of are a models access how lot to of

you comes as this large So accelerators as or now of AI cache memory call high-bandwidth for probably amount memory, it, HBM, you what of accelerator know a specialized each with guys GPUs.

make different So is side any a no part. thing. of the chips, on from both the party. attach we're it, stacking huge makers you in amount don't third chip when margin where logic do custom few are doing We function on of the it a memory, than compute the any a semiconductor -- in business. in specialized comes there margin of that who But memory silicon to of the our most margin There memory supplying business. And a are this

AI dilute do. almost by margin basic them you these memory, math sell So buying accelerators the when with which will of we

OpEx a push revenue, does But higher it revenue, the as the that is less. goes percent margin. to much higher up revenue support somewhat It so of this the the which but the regardless, spend, R&D, dilutes

So on an operating operating easily can more not better than up this the margin custom those go profitable, given to. if accelerators is profitable, AI our that margin of even It's as normal each scale level, scale.

return So very It's And that's the your answer attracts more first at is game. than there's this game. to X going And on difficult this investment that and us keeps question, a business. a only Broadcom, period.

BNP. that line of the will Karl One our come with Ackerman and question, next moment from for

your hyperscalers with own of switch-scheduled build AI clusters, are and using seek a Tomahawk allows either switch endpoint-scheduled as or is while of network. clusters custom But chipsets hyperscalers broaden, networking competitors. mix of course, to continues your unique portfolio growing among because their that, Jericho networking and business helpful portfolio to the Hock, ask to deploy deployments? unique AI year. be sales seeing white-box you switch networking $XX to will combined it understand I your a growing billion mix this AI better And

expert. He's the address have Let question. me this Charlie

Thank Hock. Yes. you,

that is X why the and our in the on provides hyperscalers this mentioned this. flexibility. have in right you're is the flexibility. use top portfolio, that -- that And by way, his it exactly they exactly quite it X unique providing quick statements X Hock, that because use things So on, out One portfolio specifically earlier we is of the

you that's intent full itself, that's to So portfolio. switching whether the you build that an your actually fabric on to we in why you happen have platform the architecture way want or have want that based endpoint and an

SAI, open which that has system top differentiator as operating that's hyperscalers. top complete has many a So us. of to working, of deployed been of actually that for And in know, a been the you using and on proven provide we've network been SONiC then on that,

the plus we so combination these that the of differentiates hyperscalers. the the offer portfolio can stack really to And solution

And or flexibility. it's Broadcom use own their gives their that if switching of products, they from own decide to you standard whether or accelerators build infrastructure are that NICs, platform, custom that full portfolio other,

our the that Fitzgerald. C.J. will line come One moment Muse for Cantor question, and from with next of

to was question. X-part software ask I hoping

Symantec and So excluding running X last VMware, your Brocade, higher for $XXX million CA, the now quarters. business

the you as April Cloud out question is like impact the curious, software seeing in Or there as So not an and you it's VMware events any to new their or think so is just less then that about onetime of rate run of Foundation seeing are that spending that January sustainable they both second that we is you? were business IT? sort other considering? And adoption, be are repurpose to budgets guys discretionary crowding should

second What be a is do not the this to like often already people on breed for vSphere breed there. people out, they to own is operations crowding compute a than today a with storage is themselves, enough any they're to productivity, that there and use they don't is to on which center. enterprises on of is compute you Well, I their take, trying best do create they data a that best-of-breed able is is and breed of driving but of spending centers. they layer, a I It's best And we're -- do something on-prem virtualization honest. best and be data not approach -- which one, heterogenous, of as highly to mixed on I offering, mixed data is lot, lot bag. resilient most best what realize. And people bag say networking center, due a obviously, And common is is not we improved continue what of they also see breed. compute have a data this building about typical best we're management know center not use bag take themselves, mean separate very what mixed have VMware category, very would to historically often mean, that, is,

Everybody cause? you Where other. at is pointing fingers it So do root down. quickly goes the find

and bare a secure you and So not very got the side. necessary other in metal side on between problem, resilient software one not

it's create into each." So to natural say, platform common best-of-breed "Hey, gets to as of that. on So CIOs many thinking to, that want to just I part talk us X a of we opposed

it's So us It's that's that that greenfield, bad, started scratch. -- that from challenging to they for it is trying not adopted. If that's to more upgrade. get means if they a have existing centers a data sometimes brownfield,

other an entire trying versus a greenfield, spend best-of-breed. well some But the where crowding where do. not I'm to as center cuts budget to obviously, on there's for a So upgrade, the here. out data they platform it on competition, way sure you're trickier existing on And can their There's that's thing us.

how that's it. So I see

crowding we're sense, mention. seeing -- me I So is to think and in any significant a don't that's answer out best level that is of that for very

that still that. along. sustain? In like chugging the cycles Brocade so no, But of through purchases. enterprise Brocade no, Hell far field will and revenue know mix, terms a great most goes having year you is great,

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that come X question, we and William do of time line the have from with Stein Securities. will And final Truist for

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to call closing like any hand for now of would Investor over the Relations, remarks. I to Ji Yoo, Head

Thank you, Cherie.

plans webcast 'XX the will you Thursday, of X, for Pacific call That p.m. conference call Broadcom's end XXXX. of call. conclude currently Time. you A X:XX today. its Broadcom the at on all follow earnings report third for quarter market joining. close after public earnings September of to will may earnings Thank our fiscal Operator,

for all This participating. program. you today's Thank concludes

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