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Broadcom Beats on Both Top and Bottom Lines

By Seth Jayson - Updated Apr 10, 2017 at 1:42PM

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Just the facts, Fool.

Broadcom (Nasdaq: BRCM) reported earnings on April 23. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended March 31 (Q1), Broadcom beat expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue expanded. Non-GAAP earnings per share stayed the same. GAAP earnings per share grew significantly.

Margins expanded across the board.

Revenue details
Broadcom reported revenue of $2.01 billion. The 40 analysts polled by S&P Capital IQ hoped for a top line of $1.91 billion on the same basis. GAAP reported sales were 13% higher than the prior-year quarter's $1.78 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.65. The 40 earnings estimates compiled by S&P Capital IQ predicted $0.56 per share. Non-GAAP EPS of $0.65 were the same as the prior-year quarter. GAAP EPS of $0.33 for Q1 were 120% higher than the prior-year quarter's $0.15 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 50.7%, 120 basis points better than the prior-year quarter. Operating margin was 10.4%, 260 basis points better than the prior-year quarter. Net margin was 9.5%, 450 basis points better than the prior-year quarter. (Margins calculated in GAAP terms.)

Looking ahead
Next quarter's average estimate for revenue is $2.05 billion. On the bottom line, the average EPS estimate is $0.66.

Next year's average estimate for revenue is $8.43 billion. The average EPS estimate is $2.77.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 968 members out of 1,046 rating the stock outperform, and 78 members rating it underperform. Among 210 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 195 give Broadcom a green thumbs-up, and 15 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Broadcom is outperform, with an average price target of $40.34.

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