After reporting its Q3 profits that topped analysts’ estimates earlier today, Broadcom forecast its fourth-quarter revenue well above estimates largely based on high demand for components that power data centers, as well as the launch of Apple’s new iPhones, Reuters is reporting. The chipmaker’s stock saw a 4% rise in extended trading following the report.
The company saw its revenue from enterprise storage business jump 70% in the reported quarter as the acquisition of Brocade helped drive sales gains at the unit. Broadcom’s wireless business, which makes chips for Wi-Fi, Bluetooth, and GPS connectivity, reported flat revenue, whereas its wired infrastructure unit posted a 4% rise from the year prior.
The company expects a ramp at its North American customer – which analysts identified as Apple – to drive a 25 percent rise in wireless revenue from the previous quarter, although it may be down in single-digit percentage compared with a year earlier.
“More than half our consolidated revenue … is benefiting from strong cloud and enterprise data center spending,” Chief Executive Officer Hock Tan said on a post-earnings call with analysts. “This, coupled with a seasonal uptick in wireless, will drive our forecast revenue in the fourth quarter.”
Broadcom forecast current-quarter revenue of about $5.40 billion, plus or minus $75 million. Analysts on average were expecting revenue of $5.35 billion.