Broadcom gives upbeat revenue forecast as server, data center demand booms

A sign to the campus offices of chip maker Broadcom Ltd, who announced on Monday an unsolicited bid to buy peer Qualcomm Inc for $103 billion, is shown in Irvine, California
A sign to the campus offices of chip maker Broadcom Ltd is shown in Irvine, California, U.S., November 6, 2017. REUTERS/Mike Blake/File Photo

Dec 8 (Reuters) - Broadcom Inc (AVGO.O) forecast current-quarter revenue above Wall Street estimates on Thursday, signaling strong demand for chips used in data centers and networking equipment.

Companies are increasingly investing in the infrastructure needed to support a switch to hybrid work models, giving Broadcom - which makes chips for data centers, routers and Wi-Fi modems - an edge over competitors with more exposure to smartphones and PCs.

Broadcom, which counts iPhone maker Apple Inc (AAPL.O) as a major customer, also stands to gain from the global rollout of 5G and its foray into the lucrative software arena.

Shares in Broadcom, which are down over 20% this year, rose 3% in extended trading.

The company forecast first-quarter revenue of about $8.9 billion, compared with analysts' estimates of $8.78 billion, according to Refinitiv data.

Revenue rose 21% to $8.93 billion in the fourth quarter ended Oct. 30. Analysts on average had expected $8.90 billion. Semiconductor revenue grew 26%, as supply chain constraints eased.

On an adjusted basis, the company earned $10.45 per share, surpassing estimates of $10.28.

Reporting by Eva Mathews in Bengaluru; Editing by Shounak Dasgupta and Maju Samuel

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