Broadcom Ltd., recently formed through Avago Technologies Ltd.’s acquisition of Broadcom Corp., said the legacy Avago business posted stronger earnings for its final quarter as a stand-alone company.
Shares rose 7.2% to $147.25 in recent after-hours trading as per-share earnings, excluding certain one-time items, beat analysts’ expectations.
Avago Technologies closed its $37 billion acquisition of Broadcom Corp. on Feb. 1, after the latest quarter ended. The combined company kept the Broadcom name along with the former Avago Technology’s ticker symbol, AVGO.
The combination of the rival chip makers melds together complementary product lines including processors that handle different chores in smartphones from Apple Inc. and Samsung Electronics Co.
When the company announced the closing of the deal, it also reported that the former Broadcom Corp. had generated revenue of $2.1 billion for the quarter ended Dec. 31 and revenue of $8.39 billion for 2015.
Over all, the former Avago Technology business had a profit of $377 million, or $1.30 a share, for the quarter ended Jan. 31, up from $351 million, or $1.26 a share, a year earlier. Excluding acquisition-related expenses, stock-based compensation and other items, per-share earnings from continuing operations rose to $2.41 from $2.09. Analysts polled by Thomson Reuters expected per-share profit of $2.30.
Revenue increased 8.3% to $1.77 billion, topping analysts’ estimates of $1.76 billion. Net revenue from continuing operations reached $1.78 billion, compared with company expectations for $1.743 billion to $1.793 billion.
Gross margin from continuing operations rose to 61% from 59%.
For the current quarter, Broadcom Ltd. forecasted revenue of $3.533 billion, plus or minus $75 million. Analysts polled by Thomson Reuters expected revenue of $3.57 billion.