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FINANCIAL NEWS RELEASE

Broadcom Inc. Announces Fourth Quarter and Fiscal Year 2020 Financial Results and Quarterly Dividends
- Revenue of $6,467 million for the fourth quarter, up 12 percent from the prior year period
- GAAP net income of $1,324 million for the fourth quarter; Adjusted EBITDA of $3,827 million for the fourth quarter
- GAAP diluted EPS of $2.93 for the fourth quarter; Non-GAAP diluted EPS of $6.35 for the fourth quarter
- $3,246 million of free cash flow from operations for the fourth quarter, defined as cash from operations of $3,348 million less capital expenditures of $102 million
- Quarterly common stock dividend increased by 11 percent to $3.60 per share from the prior quarter
- First quarter revenue guidance of approximately $6.6 billion, an expected increase of 13 percent from the prior year period
- First quarter Adjusted EBITDA guidance of approximately $3.9 billion, or 59 percent of projected revenue¹

SAN JOSE, Calif., Dec. 10, 2020 /PRNewswire/ -- Broadcom Inc. (Nasdaq: AVGO), a global technology leader that designs, develops and supplies semiconductor and infrastructure software solutions, today reported financial results for its fourth quarter and fiscal year ended November 1, 2020, provided guidance for the first quarter of its fiscal year 2021 and announced its quarterly dividends.

"We concluded the year with strong fourth quarter results driven by continued demand for networking from cloud and for broadband from service providers as well as the significant ramp in wireless, even as enterprise demand remained soft. Our infrastructure software segment continued to be stable and delivered solid results," said Hock Tan, President and CEO of Broadcom Inc. "Our first quarter revenue outlook, which projects continued overall strength, is expected to show 13 percent year over year growth, all organic."

"Despite the challenges presented by the ongoing pandemic and macroeconomic uncertainties, we achieved record profitability, generating $11.6 billion of free cash flow in fiscal 2020," said Tom Krause, CFO of Broadcom Inc. "As a result, we are raising our target common stock dividend by 11 percent to $3.60 per share per quarter for fiscal year 2021."

Fourth Quarter Fiscal Year 2020 Financial Highlights

                                     
   

GAAP

 

Non-GAAP

(Dollars in millions, except per share data)

 

Q4 20

 

Q4 19

 

Change

 

Q4 20

 

Q4 19

 

Change

Net revenue

 

$

6,467

 

$

5,776

 

+12%

 

$

6,467

 

$

5,776

 

+12%

Net income

 

$

1,324

 

$

847

 

+$    477

 

$

2,865

 

$

2,391

 

+$     474

Earnings per common share - diluted

 

$

2.93

 

$

1.97

 

+$   0.96

 

$

6.35

 

$

5.39

 

+$    0.96

 

 

(Dollars in millions)

                 

Q4 20

 

Q4 19

 

Change

Cash flow from operations

                 

$

3,348

 

$

2,479

 

+$   869

Adjusted EBITDA

                 

$

3,827

 

$

3,165

 

+$   662

Free cash flow

                 

$

3,246

 

$

2,383

 

+$   863

 

 

Net revenue by segment

                                                 

(Dollars in millions)

                     

Q4 20

 

Q4 19

 

Change

Semiconductor solutions

                     

$

4,830

 

75%

 

$

4,576

 

79%

 

+6%

Infrastructure software

                       

1,637

 

25

   

1,200

 

21

 

+36%

   Total net revenue

                     

$

6,467

 

100%

 

$

5,776

 

100%

     

 

The Company's cash and cash equivalents at the end of the fourth fiscal quarter were $7,618 million, compared to $8,857 million at the end of the prior quarter.

During the fourth fiscal quarter, the Company generated $3,348 million in cash from operations and spent $102 million on capital expenditures.

On September 30, 2020, the Company paid a cash dividend of $3.25 per share of common stock, totaling $1,320 million and a cash dividend of $20.00 per share of mandatory convertible preferred stock, totaling $75 million.

The differences between the Company's GAAP and non-GAAP results are described generally under "Non-GAAP Financial Measures" below, and presented in detail in the financial reconciliation tables attached to this release.

Fiscal Year 2020 Financial Highlights

                                     
   

GAAP

 

Non-GAAP

(Dollars in millions, except per share data)

 

2020

 

2019

 

Change

 

2020

 

2019

 

Change

Net revenue

 

$

23,888

 

$

22,597

 

+6%

 

$

23,888

 

$

22,597

 

+6%

Net income

 

$

2,960

 

$

2,724

 

+$    236

 

$

9,993

 

$

9,452

 

+$   541

Earnings per common share - diluted

 

$

6.33

 

$

6.43

 

-$   0.10

 

$

22.16

 

$

21.29

 

+$  0.87

 

 

(Dollars in millions)

                 

2020

 

2019

 

Change

Cash flow from operations

                 

$

12,061

 

$

9,697

 

+$  2,364

Adjusted EBITDA

                 

$

13,643

 

$

12,579

 

+$  1,064

Free cash flow

                 

$

11,598

 

$

9,265

 

+$  2,333

 

 

Net revenue by segment

                                                 

(Dollars in millions)

                     

2020

 

2019

 

Change

Semiconductor solutions

                     

$

17,267

 

72%

 

$

17,441

 

77%

 

-1%

Infrastructure software

                       

6,621

 

28

   

5,156

 

23

 

+28%

   Total net revenue

                     

$

23,888

 

100%

 

$

22,597

 

100%

     

 

First Quarter Fiscal Year 2021 Business Outlook

Based on current business trends and conditions, the outlook for the first quarter of fiscal year 2021, ending January 31, 2021, is expected to be as follows: 

  • First quarter revenue guidance of approximately $6.6 billion; and
  • First quarter Adjusted EBITDA of approximately $3.9 billion, or 59 percent of projected revenue.

The guidance provided above is only an estimate of what the Company believes is realizable as of the date of this release. The Company is not readily able to provide a reconciliation of projected Adjusted EBITDA to projected net income without unreasonable effort. Actual results will vary from the guidance and the variations may be material. The Company undertakes no intent or obligation to publicly update or revise any of these projections, whether as a result of new information, future events or otherwise, except as required by law.

Broadcom Inc. will be presenting to investors at the J.P. Morgan Tech Forum on January 12, 2021.

Quarterly Dividends

The Company's Board of Directors has approved a quarterly cash dividend on its common stock of $3.60 per share. The common stock dividend is payable on December 31, 2020 to common stockholders of record at the close of business (5:00 p.m. Eastern Time) on December 21, 2020.

The Company's Board of Directors has also approved a quarterly cash dividend on its 8.00% Mandatory Convertible Preferred Stock, Series A, of $20.00 per share. This dividend is payable on December 31, 2020 to preferred stockholders of record at the close of business (5:00 p.m. Eastern Time) on December 15, 2020.

Financial Results Conference Call

Broadcom Inc. will host a conference call to review its financial results for the fourth quarter and fiscal year ended November 1, 2020, and to discuss the business outlook, today at 2:00 p.m. Pacific Time. Those wishing to access the call should dial (866) 310-8712; International +1 (720) 634-2946. The passcode is 5074985. A replay of the call will be accessible for one week after the call. To access the replay dial (855) 859-2056; International +1 (404) 537-3406; and reference the passcode: 5074985. A webcast of the conference call will also be available in the "Investors" section of Broadcom's website at www.broadcom.com.

Basis of Presentation

The Company's financial results include contributions from the Symantec enterprise security business's continuing operations starting in the first quarter of fiscal year 2020. The financial results from businesses that have been classified as discontinued operations in the Company's financial statements are not included in the results presented above, unless otherwise stated.

Non-GAAP Financial Measures

In addition to GAAP reporting, Broadcom provides investors with net revenue, net income, operating income, gross margin, operating expenses, cash flow and other data on a non-GAAP basis. This non-GAAP information excludes amortization of acquisition-related intangible assets, stock-based compensation expense, restructuring, impairment and disposal charges, acquisition-related costs, including integration costs, purchase accounting effect on inventory, litigation settlements, loss on debt extinguishment, gain from lapse of indemnification, gains (losses) on investments, gain from sale of business, income (loss) from discontinued operations and non-GAAP tax reconciling adjustments. Management does not believe that these items are reflective of the Company's underlying performance. Internally, these non-GAAP measures are significant measures used by management for purposes of evaluating the core operating performance of the Company, establishing internal budgets, calculating return on investment for development programs and growth initiatives, comparing performance with internal forecasts and targeted business models, strategic planning, evaluating and valuing potential acquisition candidates and how their operations compare to the Company's operations, and benchmarking performance externally against the Company's competitors. The exclusion of these and other similar items from Broadcom's non-GAAP financial results should not be interpreted as implying that these items are non-recurring, infrequent or unusual.

Free cash flow measures have limitations as they omit certain components of the overall cash flow statement and do not represent the residual cash flow available for discretionary expenditures. Investors should not consider presentation of free cash flow measures as implying that stockholders have any right to such cash. Broadcom's free cash flow may not be calculated in a manner comparable to similarly named measures used by other companies.

Broadcom believes this non-GAAP financial information provides additional insight into the Company's on-going performance. Therefore, Broadcom provides this information to investors for a more consistent basis of comparison and to help them evaluate the results of the Company's on-going operations and enable more meaningful period to period comparisons. These non-GAAP measures are provided in addition to, and not as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. A reconciliation between GAAP and non-GAAP financial data is included in the supplemental financial data attached to this press release.

About Broadcom Inc.

Broadcom Inc., (NASDAQ: AVGO), a Delaware corporation headquartered in San Jose, CA, is a global technology leader that designs, develops and supplies a broad range of semiconductor and infrastructure software solutions. Broadcom's category-leading product portfolio serves critical markets including data center, networking, enterprise software, broadband, wireless, storage and industrial. Our solutions include data center networking and storage, enterprise, mainframe and cyber security software focused on automation, monitoring and security, smartphone components, telecoms and factory automation. For more information, go to www.broadcom.com.

Cautionary Note Regarding Forward-Looking Statements

This announcement contains forward-looking statements (including within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended) concerning Broadcom. These statements include, but are not limited to, statements that address our expected future business and financial performance and other statements identified by words such as "will", "expect", "believe", "anticipate", "estimate", "should", "intend", "plan", "potential", "predict" "project", "aim", and similar words, phrases or expressions. These forward-looking statements are based on current expectations and beliefs of the management of Broadcom, as well as assumptions made by, and information currently available to, such management, current market trends and market conditions and involve risks and uncertainties, many of which are outside the Company's and management's control, and which may cause actual results to differ materially from those contained in forward-looking statements. Accordingly, you should not place undue reliance on such statements.

Particular uncertainties that could materially affect future results include risks associated with: the COVID-19 pandemic, which has, and will likely continue to, negatively impact the global economy and disrupt normal business activity, and which may have an adverse effect on our results of operations; any loss of our significant customers and fluctuations in the timing and volume of significant customer demand; our dependence on contract manufacturing and outsourced supply chain; our dependency on a limited number of suppliers; global economic conditions and concerns; global political and economic conditions; government regulations, trade restrictions and trade tensions; our significant indebtedness and the need to generate sufficient cash flows to service and repay such debt; dependence on and risks associated with distributors and resellers of our products; dependence on senior management and our ability to attract and retain qualified personnel; any acquisitions we may make, such as delays, challenges and expenses associated with receiving governmental and regulatory approvals and satisfying other closing conditions, and with integrating acquired businesses with our existing businesses and our ability to achieve the benefits, growth prospects and synergies expected by such acquisitions; involvement in legal or administrative proceedings; quarterly and annual fluctuations in operating results; our ability to accurately estimate customers' demand and adjust our manufacturing and supply chain accordingly; cyclicality in the semiconductor industry or in our target markets; our competitive performance and ability to continue achieving design wins with our customers, as well as the timing of any design wins; prolonged disruptions of our or our contract manufacturers' manufacturing facilities, warehouses or other significant operations; our ability to improve our manufacturing efficiency and quality; our dependence on outsourced service providers for certain key business services and their ability to execute to our requirements; our ability to maintain or improve gross margin; our ability to protect our intellectual property and the unpredictability of any associated litigation expenses; compatibility of our software products with operating environments, platforms or third-party products; our ability to enter into satisfactory software license agreements; availability of third party software used in our products; use of open source code sources in our products; any expenses or reputational damage associated with resolving customer product warranty and indemnification claims; market acceptance of the end products into which our products are designed; our ability to sell to new types of customers and to keep pace with technological advances; our compliance with privacy and data security laws; our ability to protect against a breach of security systems; fluctuations in foreign exchange rates; our provision for income taxes and overall cash tax costs, legislation that may impact our overall cash tax costs and our ability to maintain tax concessions in certain jurisdictions; and other events and trends on a national, regional and global scale, including those of a political, economic, business, competitive and regulatory nature. Many of the foregoing risks and uncertainties are, and will be, exacerbated by the COVID-19 pandemic and any worsening of the global business and economic environment as a result. 

Our filings with the SEC, which you may obtain for free at the SEC's website at http://www.sec.gov, discuss some of the important risk factors that may affect our business, results of operations and financial condition. Actual results may vary from the estimates provided. We undertake no intent or obligation to publicly update or revise any of the estimates and other forward-looking statements made in this announcement, whether as a result of new information, future events or otherwise, except as required by law.

Contact:
Broadcom Inc.
Beatrice F. Russotto
Investor Relations
408-433-8000
investor.relations@broadcom.com

 

1 The Company is not readily able to provide a reconciliation of the projected non-GAAP financial information presented to the relevant projected GAAP measure without unreasonable effort.

 

BROADCOM INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED

(IN MILLIONS, EXCEPT PER SHARE DATA)

                               
                               
   

Fiscal Quarter Ended

 

Fiscal Year Ended

   

November 1,

 

August 2,

 

November 3,

 

November 1,

 

November 3,

   

2020

 

2020

 

2019

 

2020

 

2019

                               

Net revenue

 

$

6,467

 

$

5,821

 

$

5,776

 

$

23,888

 

$

22,597

Cost of revenue:

                             

Cost of revenue

   

1,753

   

1,537

   

1,788

   

6,518

   

6,723

Amortization of acquisition-related intangible assets

   

962

   

953

   

827

   

3,819

   

3,314

Restructuring charges

   

5

   

15

   

9

   

35

   

77

Total cost of revenue

   

2,720

   

2,505

   

2,624

   

10,372

   

10,114

Gross margin

   

3,747

   

3,316

   

3,152

   

13,516

   

12,483

Research and development

   

1,182

   

1,228

   

1,177

   

4,968

   

4,696

Selling, general and administrative

   

405

   

428

   

409

   

1,935

   

1,709

Amortization of acquisition-related intangible assets

   

599

   

600

   

474

   

2,401

   

1,898

Restructuring, impairment and disposal charges

   

35

   

52

   

38

   

198

   

736

Total operating expenses

   

2,221

   

2,308

   

2,098

   

9,502

   

9,039

Operating income

   

1,526

   

1,008

   

1,054

   

4,014

   

3,444

Interest expense

   

(420)

   

(464)

   

(361)

   

(1,777)

   

(1,444)

Other income, net

   

31

   

49

   

54

   

206

   

226

Income from continuing operations before income taxes

   

1,137

   

593

   

747

   

2,443

   

2,226

Benefit from income taxes

   

(187)

   

(96)

   

(100)

   

(518)

   

(510)

Income from continuing operations

   

1,324

   

689

   

847

   

2,961

   

2,736

Loss from discontinued operations, net of income taxes

   

-

   

(1)

   

-

   

(1)

   

(12)

Net income

   

1,324

   

688

   

847

   

2,960

   

2,724

Dividends on preferred stock

   

(74)

   

(74)

   

(29)

   

(297)

   

(29)

Net income attributable to common stock

 

$

1,250

 

$

614

 

$

818

 

$

2,663

 

$

2,695

                               

Basic income per share attributable to common stock:

                             

Income per share from continuing operations

 

$

3.09

 

$

1.53

 

$

2.06

 

$

6.62

 

$

6.80

Loss per share from discontinued operations

   

-

   

(0.01)

   

-

   

-

   

(0.03)

Net income per share

 

$

3.09

 

$

1.52

 

$

2.06

 

$

6.62

 

$

6.77

                               

Diluted income per share attributable to common stock (1):

                             

Income per share from continuing operations

 

$

2.93

 

$

1.46

 

$

1.97

 

$

6.33

 

$

6.46

Loss per share from discontinued operations

   

-

   

(0.01)

   

-

   

-

   

(0.03)

Net income per share

 

$

2.93

 

$

1.45

 

$

1.97

 

$

6.33

 

$

6.43

                               

Weighted-average shares used in per share calculations:

                             

Basic

   

405

   

403

   

397

   

402

   

398

Diluted

   

426

   

422

   

416

   

421

   

419

                               

Stock-based compensation expense included in continuing operations:

                             

Cost of revenue

 

$

38

 

$

37

 

$

41

 

$

159

 

$

163

Research and development

   

318

   

337

   

394

   

1,419

   

1,532

Selling, general and administrative

   

93

   

91

   

109

   

398

   

490

Total stock-based compensation expense

 

$

449

 

$

465

 

$

544

 

$

1,976

 

$

2,185

                               
 

(1) Excludes the potentially dilutive effect of Mandatory Convertible Preferred Stock as the impact was antidilutive.

 

BROADCOM INC.

FINANCIAL RECONCILIATION: GAAP TO NON-GAAP - UNAUDITED

(IN MILLIONS, EXCEPT PERCENTAGES)

                               
                               
   

Fiscal Quarter Ended

 

Fiscal Year Ended

   

November 1,

 

August 2,

 

November 3,

 

November 1,

 

November 3,

   

2020

 

2020

 

2019

 

2020

 

2019

                               

Gross margin on GAAP basis

 

$

3,747

 

$

3,316

 

$

3,152

 

$

13,516

 

$

12,483

Purchase accounting effect on inventory

   

-

   

-

   

-

   

11

   

-

Amortization of acquisition-related intangible assets

   

962

   

953

   

827

   

3,819

   

3,314

Stock-based compensation expense

   

38

   

37

   

41

   

159

   

163

Restructuring charges

   

5

   

15

   

9

   

35

   

77

Acquisition-related costs

   

6

   

-

   

6

   

12

   

18

Gross margin on non-GAAP basis

 

$

4,758

 

$

4,321

 

$

4,035

 

$

17,552

 

$

16,055

                               

Research and development on GAAP basis

 

$

1,182

 

$

1,228

 

$

1,177

 

$

4,968

 

$

4,696

Stock-based compensation expense

   

318

   

337

   

394

   

1,419

   

1,532

Acquisition-related costs

   

1

   

1

   

1

   

14

   

5

Research and development on non-GAAP basis

 

$

863

 

$

890

 

$

782

 

$

3,535

 

$

3,159

                               

Selling, general and administrative expense on GAAP basis

 

$

405

 

$

428

 

$

409

 

$

1,935

 

$

1,709

Stock-based compensation expense

   

93

   

91

   

109

   

398

   

490

Acquisition-related costs

   

60

   

66

   

65

   

396

   

252

Litigation settlements

   

-

   

21

   

-

   

63

   

-

Selling, general and administrative expense on non-GAAP basis

 

$

252

 

$

250

 

$

235

 

$

1,078

 

$

967

                               

Total operating expenses on GAAP basis

 

$

2,221

 

$

2,308

 

$

2,098

 

$

9,502

 

$

9,039

Amortization of acquisition-related intangible assets

   

599

   

600

   

474

   

2,401

   

1,898

Stock-based compensation expense

   

411

   

428

   

503

   

1,817

   

2,022

Restructuring, impairment and disposal charges

   

35

   

52

   

38

   

198

   

736

Litigation settlements

   

-

   

21

   

-

   

63

   

-

Acquisition-related costs

   

61

   

67

   

66

   

410

   

257

Total operating expenses on non-GAAP basis

 

$

1,115

 

$

1,140

 

$

1,017

 

$

4,613

 

$

4,126

                               

Operating income on GAAP basis

 

$

1,526

 

$

1,008

 

$

1,054

 

$

4,014

 

$

3,444

Purchase accounting effect on inventory

   

-

   

-

   

-

   

11

   

-

Amortization of acquisition-related intangible assets

   

1,561

   

1,553

   

1,301

   

6,220

   

5,212

Stock-based compensation expense

   

449

   

465

   

544

   

1,976

   

2,185

Restructuring, impairment and disposal charges

   

40

   

67

   

47

   

233

   

813

Litigation settlements

   

-

   

21

   

-

   

63

   

-

Acquisition-related costs

   

67

   

67

   

72

   

422

   

275

Operating income on non-GAAP basis

 

$

3,643

 

$

3,181

 

$

3,018

 

$

12,939

 

$

11,929

                               

Interest expense on GAAP basis

 

$

(420)

 

$

(464)

 

$

(361)

 

$

(1,777)

 

$

(1,444)

Loss on debt extinguishment

   

16

   

55

   

26

   

169

   

54

Interest expense on non-GAAP basis

 

$

(404)

 

$

(409)

 

$

(335)

 

$

(1,608)

 

$

(1,390)

                               

Other income, net on GAAP basis

 

$

31

 

$

49

 

$

54

 

$

206

 

$

226

Gain from lapse of indemnification

   

-

   

-

   

-

   

(116)

   

-

Gains on investments

   

(10)

   

(31)

   

(50)

   

(31)

   

(145)

Gain from sale of business

   

-

   

(23)

   

-

   

(23)

   

-

Acquisition-related gain

   

(4)

   

-

   

-

   

(11)

   

-

Other income (loss), net on non-GAAP basis

 

$

17

 

$

(5)

 

$

4

 

$

25

 

$

81

                               

Benefit from income taxes on GAAP basis

 

$

(187)

 

$

(96)

 

$

(100)

 

$

(518)

 

$

(510)

Non-GAAP tax reconciling adjustments

   

578

   

428

   

396

   

1,881

   

1,678

Provision for income taxes on non-GAAP basis

 

$

391

 

$

332

 

$

296

 

$

1,363

 

$

1,168

                               

Net income on GAAP basis

 

$

1,324

 

$

688

 

$

847

 

$

2,960

 

$

2,724

Purchase accounting effect on inventory

   

-

   

-

   

-

   

11

   

-

Amortization of acquisition-related intangible assets

   

1,561

   

1,553

   

1,301

   

6,220

   

5,212

Stock-based compensation expense

   

449

   

465

   

544

   

1,976

   

2,185

Restructuring, impairment and disposal charges

   

40

   

67

   

47

   

233

   

813

Litigation settlements

   

-

   

21

   

-

   

63

   

-

Acquisition-related costs

   

63

   

67

   

72

   

411

   

275

Loss on debt extinguishment

   

16

   

55

   

26

   

169

   

54

Gain from lapse of indemnification

   

-

   

-

   

-

   

(116)

   

-

Gains on investments

   

(10)

   

(31)

   

(50)

   

(31)

   

(145)

Gain from sale of business

   

-

   

(23)

   

-

   

(23)

   

-

Non-GAAP tax reconciling adjustments

   

(578)

   

(428)

   

(396)

   

(1,881)

   

(1,678)

Discontinued operations, net of income taxes

   

-

   

1

   

-

   

1

   

12

Net income on non-GAAP basis

 

$

2,865

 

$

2,435

 

$

2,391

 

$

9,993

 

$

9,452

                               
                               

Weighted-average shares used in per share calculations - diluted on GAAP basis

   

426

   

422

   

416

   

421

   

419

Non-GAAP adjustment (1)

   

25

   

29

   

28

   

30

   

25

Weighted-average shares used in per share calculations - diluted on non-GAAP basis

   

451

   

451

   

444

   

451

   

444

                               
                               

Net income on non-GAAP basis

 

$

2,865

 

$

2,435

 

$

2,391

 

$

9,993

 

$

9,452

Interest expense on non-GAAP basis

   

404

   

409

   

335

   

1,608

   

1,390

Provision for income taxes on non-GAAP basis

   

391

   

332

   

296

   

1,363

   

1,168

Depreciation

   

139

   

138

   

143

   

570

   

569

Amortization of purchased intangibles and right-of-use assets

   

28

   

28

   

-

   

109

   

-

Adjusted EBITDA

 

$

3,827

 

$

3,342

 

$

3,165

 

$

13,643

 

$

12,579

                               

Net cash provided by operating activities

 

$

3,348

 

$

3,178

 

$

2,479

 

$

12,061

 

$

9,697

Purchases of property, plant and equipment

   

(102)

   

(105)

   

(96)

   

(463)

   

(432)

Free cash flow

 

$

3,246

 

$

3,073

 

$

2,383

 

$

11,598

 

$

9,265

                               
                               
   

 Fiscal Quarter
Ending 

                       
   

January 31,

                       

Expected average diluted share count:

 

2021

                       
                               

Weighted-average shares used in per share calculation - diluted on GAAP basis

 

427

                       

 Non-GAAP adjustment (1)

 

23

                       

Weighted-average shares used in per share calculation - diluted on non-GAAP basis

 

450

                       
                               
 

(1) Non-GAAP adjustment for the number of shares used in the diluted per share calculations excludes the impact of stock-based compensation expense expected to be incurred in future periods and not yet recognized in the financial statements, which would otherwise be assumed to be used to repurchase shares under the GAAP treasury stock method. For the periods presented, the non-GAAP adjustment included the impact of Mandatory Convertible Preferred Stock that was antidilutive on a GAAP basis. For the fiscal quarter ending January 31, 2021, the non-GAAP adjustment includes the impact of Mandatory Convertible Preferred Stock that is expected to be antidilutive on a GAAP basis.

 

BROADCOM INC.

CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED

(IN MILLIONS)

               
               
   

November 1,

 

November 3,

 
   

2020

 

2019

 
               

ASSETS

             
               

Current assets:

             

  Cash and cash equivalents

 

$

7,618

 

$

5,055

 

  Trade accounts receivable, net

   

2,297

   

3,259

 

  Inventory

   

1,003

   

874

 

  Other current assets

   

977

   

729

 

  Total current assets

   

11,895

   

9,917

 
               

Long-term assets:

             

  Property, plant and equipment, net

   

2,509

   

2,565

 

  Goodwill

   

43,447

   

36,714

 

  Intangible assets, net

   

16,782

   

17,554

 

  Other long-term assets

   

1,300

   

743

 

  Total assets

 

$

75,933

 

$

67,493

 
               
               

LIABILITIES AND EQUITY

             
               

Current liabilities:

             

  Accounts payable

 

$

836

 

$

855

 

  Employee compensation and benefits

   

877

   

641

 

  Current portion of long-term debt

   

827

   

2,787

 

  Other current liabilities

   

3,831

   

2,616

 

  Total current liabilities

   

6,371

   

6,899

 
               

Long-term liabilities:

             

  Long-term debt

   

40,235

   

30,011

 

  Other long-term liabilities

   

5,426

   

5,613

 

  Total liabilities

   

52,032

   

42,523

 
               

Preferred stock dividend obligation

   

27

   

29

 
               

Stockholders' equity:

             

  Preferred stock

   

-

   

-

 

  Common stock

   

-

   

-

 

  Additional paid-in capital

   

23,982

   

25,081

 

  Retained earnings

   

-

   

-

 

  Accumulated other comprehensive loss

   

(108)

   

(140)

 

  Total stockholders' equity

   

23,874

   

24,941

 

    Total liabilities and equity

 

$

75,933

 

$

67,493

 

 

BROADCOM INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

(IN MILLIONS)

                               
   

Fiscal Quarter Ended

 

Fiscal Year Ended

   

November 1,

 

August 2,

 

November 3,

 

November 1,

 

November 3,

   

2020

 

2020

 

2019

 

2020

 

2019

Cash flows from operating activities:

                             

Net income

 

$

1,324

 

$

688

 

$

847

 

$

2,960

 

$

2,724

Adjustments to reconcile net income to net cash provided by operating activities:

                           

  Amortization of intangible and right-of-use assets

   

1,589

   

1,581

   

1,309

   

6,335

   

5,239

  Depreciation

   

139

   

138

   

143

   

570

   

569

  Stock-based compensation

   

449

   

465

   

544

   

1,976

   

2,185

  Deferred taxes and other non-cash taxes

   

(459)

   

(436)

   

(226)

   

(1,142)

   

(934)

  Loss on debt extinguishment included in interest expense

   

16

   

55

   

26

   

169

   

28

  Non-cash restructuring, impairment and disposal charges

   

12

   

15

   

20

   

44

   

133

  Non-cash interest expense

   

25

   

22

   

19

   

108

   

69

  Other

   

(9)

   

(54)

   

(49)

   

(52)

   

(132)

  Changes in assets and liabilities, net of acquisitions and disposals:

                             

    Trade accounts receivable, net

   

391

   

542

   

285

   

981

   

486

    Inventory

   

67

   

(128)

   

217

   

(31)

   

250

    Accounts payable

   

(230)

   

(123)

   

(147)

   

(3)

   

(42)

    Employee compensation and benefits

   

142

   

231

   

66

   

217

   

(294)

    Other current assets and current liabilities

   

(131)

   

(2)

   

(398)

   

331

   

(283)

    Other long-term assets and long-term liabilities

   

23

   

184

   

(177)

   

(402)

   

(301)

Net cash provided by operating activities

   

3,348

   

3,178

   

2,479

   

12,061

   

9,697

                               

Cash flows from investing activities:

                             

  Acquisitions of businesses, net of cash acquired

   

-

   

(2)

   

-

   

(10,872)

   

(16,033)

  Proceeds from sales of businesses

   

-

   

50

   

-

   

218

   

957

  Purchases of property, plant and equipment

   

(102)

   

(105)

   

(96)

   

(463)

   

(432)

  Proceeds from disposals of property, plant and equipment

   

2

   

10

   

6

   

12

   

88

  Other

   

-

   

1

   

2

   

(4)

   

(2)

Net cash used in investing activities

   

(100)

   

(46)

   

(88)

   

(11,109)

   

(15,422)

                               

Cash flows from financing activities:

                             

  Proceeds from long-term borrowings

   

-

   

7,953

   

-

   

27,802

   

28,793

  Repayment of debt

   

(3,000)

   

(6,825)

   

(4,800)

   

(18,814)

   

(16,800)

  Other borrowings, net

   

-

   

(3,028)

   

(104)

   

(1,285)

   

1,241

  Payment of dividends

   

(1,395)

   

(1,386)

   

(1,054)

   

(5,534)

   

(4,235)

  Repurchases of common stock - repurchase program

   

-

   

-

   

(433)

   

-

   

(5,435)

  Shares repurchased for tax withholdings on vesting of equity awards

   

(185)

   

(192)

   

(154)

   

(765)

   

(972)

  Issuance of preferred stock, net

   

-

   

-

   

3,679

   

-

   

3,679

  Issuance of common stock

   

102

   

46

   

59

   

276

   

253

  Other

   

(9)

   

(50)

   

9

   

(69)

   

(36)

Net cash provided by (used in) financing activities

   

(4,487)

   

(3,482)

   

(2,798)

   

1,611

   

6,488

                               

Net change in cash and cash equivalents

   

(1,239)

   

(350)

   

(407)

   

2,563

   

763

Cash and cash equivalents at beginning of period

   

8,857

   

9,207

   

5,462

   

5,055

   

4,292

Cash and cash equivalents at end of period

 

$

7,618

 

$

8,857

 

$

5,055

 

$

7,618

 

$

5,055

                               

Supplemental disclosure of cash flow information:

                             

Cash paid for interest

 

$

383

 

$

269

 

$

307

 

$

1,408

 

$

1,287

Cash paid for income taxes

 

$

202

 

$

44

 

$

123

 

$

501

 

$

741

 

 

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SOURCE Broadcom Inc.