What's Going on With Broadcom Stock? | AVGO Stock Analysis

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브로드컴의 AI 매출이 전년比 280% 급증해 31억 달러로 전체 매출(125억 달러)의 약 1/4을 차지하며 성장 동력이 됐다. VMware 인수 후 구독 전환과 비용 절감(분기 지출 23억→12억 달러 수준)이 진행 중이며, VMware 영업이익률은 2025년경 브로드컴 수준으로 수렴할 것으로 예상된다. 네트워킹 매출도 44% 성장해 하이퍼스케일러 투자 수혜가 기대된다. 주가 상승은 액면분할보다 AI 성장과 인수 통합 진전에 더 기인한다고 본다.

다듬은 글

※ 자동 자막 원문(다듬기 전)

01. hey everyone you probably already heard about the announcement for broadcom to do a stock split I know that's creating a lot of enthusiasm for broadcom stock investors and those interested in broadcom stock but there's more going on behind the scenes that's causing the stock price to increase following the company's quarterly investor update so I wanted to provide a little more detail behind the scenes on what's going on with broadcom one of the reasons why broadcom investors were so excited was because revenue is increasing nicely even if you exclude the impact of the VMware acquisition if you do include the impact revenues were up 43% to 12.5 billion but even if you exclude the impacts Consolidated Revenue was still up 12% and that was driven by by AI Revenue which increased by 280% year-over-year to 3.1 billion so not only did revenue from the AI segment Jump by 280% but it's now a more meaningful portion of the company's overall business 3.1 billion out of 12.5 billion nearly 1/4 of the business now consisted of artificial intelligence business and since that segment is growing much faster it's likely to make up a greater portion of the company's overall business of course investors are more excited about stock given that industry is growing so rapidly and it's growing much more quickly than some of broadcom's other business which is some of it is actually stagnating or declining so the increase from artificial intelligence is welcome news for broadcom stock investors and we got more good news about the integration of the acquisition the management saying that it's going well that they're making good progress transitioning all VMware products to a subscription licensing model and since closing the deal they've actually signed up close to 3,000 of their largest 10,000 customers to enable them to build a self-service virtual private Cloud on premise now this is important because typically Acquisitions of these size are difficult to digest but when you have a company like broadcom that has a history of Acquisitions and making large Acquisitions that have demonstrated skill in this uh process that helps make it better it helps them learn and it helps them improve this digestion process and it excludes waste it reduces waste from these large Acquisitions which can be a big mistake sometimes when companies make these large billion dollar several billion dollar Acquisitions the company going on to say that they integrated the sgna across the entire platform and eliminated redundant functions this is integrated selling General and administrative expenses the general and administrative expenses in particular can be redundant when you acquire a company right you don't need two board of directors you don't need two CEOs you don't need two Finance departments and so you can integrate and eliminate some of those functions and thereby increase the profitability of the business that you acquired and that's precisely what broadcom is doing here so spending run rate at VMware is falling to 1.6 billion this quarter from what used to be 2.3 billion per quarter before the acquisition and they expect spending will continue to decline towards 1.3 billion exiting Q4 and then it'll stabilize around 1.2 billion in the end so they're going to take a company that was generating 2 3 billion on costs and bring that down by roughly half to 1.2 billion this is why you sometimes see companies make large bids for Acquisitions that are well above the market cap of the company sometimes you might hear a company makes a bid for a stock that's trading at $10 per share and they'll make an offer at $17 per share you might ask why are they making such an over bid asking price here and the reason is because they feel confident that when they acquire this company they can eliminate some of these costs and that company the acquisition the business that they're acquiring will actually become more profitable because they'll be able to eliminate some of those costs they also might eliminate competitive pressure because sometimes they acquire a competitor or sometimes they acquire a supplier and so there are strategic benefits to these Acquisitions that enable companies or acquire ERS to pay more than the asking price or more than the market price but a lot of times they still overbid they still overpay few companies and broadcom is one of them that are able to make Acquisitions effectively without overpaying absorbing them effectively bringing it in and broadcom has a history of doing this effectively and it looks like this acquisition of VMware is going to be another case in point where the company May makes a good decision so VMware Revenue in the q1 was 2.1 billion that grew to 2.7 billion in Q2 and will accelerate towards 4 billion per quarter and that's because they're going to integrate it with the existing business sell VMware products to their existing customers which they're already making great progress on and therefore they expect operating margins for VMware to begin to converge towards that of classic broadcom software by fiscal 2025 and broadcom's long been one of the most profitable companies in the world excellent operating profit margins and it's great to hear that this acquisition the revenue from this acquisition this segment will converge towards broadcom operating profit margins by 2025 so it won't bring down the company's profit margins it'll actually supplement their operating profit margin longer term so networking Revenue in the second quarter of 3.8 billion was up 44% and it now represents 53% of its semiconductor Revenue that was again driven by strong demand from hyperscalers for both AI networking and custom accelerators now these hyper scalers include companies like Amazon in Amazon web services like Microsoft for its Cloud business like Google for its Cloud business Oracle for its Cloud business and all of those companies that I just highlighted have signaled that they're going to increase spending this year by the billions of dollars and then again next year by the several billions of dollars and so this category for broadcom will likely benefit on that strong Tailwind from hyperscalers that are really looking to build out their networking their AI factories as they're now being called and that's really going to be a boom for broadcom in this business segment so you can start to understand a lot of the reasons why investors were enthusiastic about broadcom stock I would say the impacts from artificial intelligence and the progress with the integration of VMware have more to do with the increasing stock price than the stock split I know the stock split might be exciting for retail stock investors but for more professional investors institutional investors these factors were more important than the stock split the fact that they're able to bring this acquisition in with billions of Revenue now increasing the amount of quarterly Revenue run rate for VMware and reducing the costs at VMware by roughly half I think those are great developments that investors are very enthusiastic about and you can understand why the stock price is up by so much following these announcements