What happened
Shares of Broadcom (AVGO -0.48%) climbed 8.3% on Friday after the chipmaker said it would return more cash to shareholders in the year ahead.
So what
Broadcom's revenue rose 15% year over year to $7.4 billion in its fiscal 2021 fourth quarter. Revenue in the company's semiconductor solutions and infrastructure software divisions increased 17% and 8%, respectively, to $5.6 billion and $1.8 billion.
"Broadcom concluded the year with record fourth-quarter results driven by a rebound in enterprise, and continued strength from cloud and service provider demand," CEO Hock Tan said in a press release.
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Moreover, Broadcom's profitability and cash flow production strengthened. Its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) leaped 19% to $4.5 billion. Broadcom's free cash flow, meanwhile, grew 6%.
"In fiscal 2021, we achieved record adjusted EBITDA margin of 60%, generating $13.3 billion of free cash flow, or 49% of revenue," chief financial officer Kirsten Spears said.
Management intends to pass a sizable portion of that cash on to shareowners. Broadcom boosted its quarterly dividend by 14% to $4.10 per share. It also announced plans to buy back $10 billion worth of its stock.
"The initiation of a new share repurchase program reflects the confidence of the board of directors in Broadcom's strong cash flow generation and provides us with a complementary tool to deliver value to our stockholders," Spears said.
Now what
Broadcom expects to earn revenue of roughly $7.6 billion in the first quarter of fiscal 2022. The company also guided for an adjusted EBITDA margin of about 61.5%.
Looking further ahead, Tan expressed optimism in Broadcom's long-term competitive position. "With the strength and breadth of our IP [intellectual property] portfolio, we continue to be able to uniquely deliver leading-edge, best-in-class semiconductor solutions, and extend our leadership in our franchise markets," Tan said.
