Broadcom (AVGO) investor relations material

Executive summary

• Q1 FY26 revenue reached a record $19.3B, up 29% year-over-year, driven by strong AI semiconductor and networking demand.

• Q1 AI revenue was $8.4B, up 106% year-over-year, with expectations for $10.7B in Q2.

• Net income for Q1 was $7.35B, up 34% year-over-year; operating income increased 37% to $8.56B.

• Returned $10.9B to shareholders in Q1 via $3.1B in dividends and $7.8B in stock repurchases.

• Cash from operations reached $8.26B, supporting significant capital returns.

Financial highlights

• Q1 gross margin was 77%; GAAP gross margin was $13.16B (68% of revenue); non-GAAP gross margin was $14.87B.

• Adjusted EBITDA was $13.13B (68% of revenue), up 30% year-over-year.

• Free cash flow was $8.01B (41% of revenue); cash and cash equivalents at quarter-end were $14.17B.

• Operating income (GAAP) was $8.56B; non-GAAP operating income was $12.83B.

• Outstanding debt was $67.97B, with $2.25B due within 12 months.

Outlook and guidance

• Q2 FY26 revenue guidance is $22B, up 47% year-over-year, with AI momentum expected to accelerate.

• Q2 semiconductor revenue forecast at $14.8B, up 76% year-over-year; AI semiconductor revenue to reach $10.7B, up 140%.

• Infrastructure software revenue for Q2 expected at $7.2B, up 9% year-over-year.

• Gross margin expected to remain flat at 77%; adjusted EBITDA at 68%.

• Liquidity expected to remain strong, with sufficient cash, cash flow, and credit facilities for at least 12 months.