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Broadcom Inc.: Q3 FY2026 earnings call

What management said about Q3 FY2026, from the documents filed with the SEC on 2 September 2026: press release. Guidance figures: 4 new, 1 kept. The quarter’s numbers.

Key takeaways

  • Revenue up 86 percent: Revenue reached $29.6 billion, up 86 percent from the prior year period, with both segments growing. Source
  • Non-GAAP operating income up 92 percent: GAAP operating income was $16.0 billion, up 171 percent. Non-GAAP operating income was $20.1 billion, up 92 percent from $10.5 billion a year earlier. Source
  • Semiconductor solutions up 127 percent: Semiconductor solutions revenue was $20.8 billion, up from $9.2 billion a year earlier, and is the larger of the two segments. Source
  • AI demand continues, management says: Management said demand for custom AI accelerators and networking continues. Source
  • AI semiconductor revenue up 221 percent: AI semiconductor revenue was $16.7 billion, up 221 percent year over year and 54 percent from the prior quarter. Source
  • Free cash flow of $13.7 billion: Operating cash flow of $14.2 billion, less $0.5 billion of capital expenditures, gave free cash flow equal to 46 percent of revenue. Source

“Demand for our custom AI accelerators and networking continues to be very strong.”

Hock Tan, President and CEO of Broadcom Inc.

Guidance

AreaPeriodFigureAgainst last quarter
Revenue Sourcefourth quarter of fiscal 2026approximately $34.8 billionNew
Revenue growth Sourcefourth quarter of fiscal 202693%New
Non-GAAP operating margin Sourcefourth quarter of fiscal 2026approximately 66 percent of projected revenueNew
AI semiconductor revenue Sourcefourth quarter of fiscal 2026$21.7 billion, up 236% year-over-yearNew
Quarterly dividend Sourcedividend payable September 30, 2026$0.65 per shareKept

What changed from last quarter

  • New guidance: Guidance is now given for the fourth quarter of fiscal 2026 and ends November 1, 2026. The prior release gave third quarter guidance. Source
  • New: Amie Thuener is named as CFO in this release. The prior release named Kirsten Spears in that role. Source

Results and growth drivers

  • Revenue up 86 percent: Revenue reached $29.6 billion, up 86 percent from the prior year period, with both segments growing. Source
  • Non-GAAP operating income up 92 percent: GAAP operating income was $16.0 billion, up 171 percent. Non-GAAP operating income was $20.1 billion, up 92 percent from $10.5 billion a year earlier. Source
  • Non-GAAP diluted EPS up 96 percent: GAAP diluted EPS was $2.68, up from $0.85. Non-GAAP diluted EPS was $3.32, up from $1.69 a year earlier. Source

Segments, products and AI demand

  • Semiconductor solutions up 127 percent: Semiconductor solutions revenue was $20.8 billion, up from $9.2 billion a year earlier, and is the larger of the two segments. Source
  • Infrastructure software up 29 percent: Infrastructure software revenue was $8.8 billion, up from $6.8 billion a year earlier. Source
  • AI demand continues, management says: Management said demand for custom AI accelerators and networking continues. Source
  • AI semiconductor revenue up 221 percent: AI semiconductor revenue was $16.7 billion, up 221 percent year over year and 54 percent from the prior quarter. Source

“In Q4 the momentum continues, and we expect AI semiconductor revenue to accelerate to $21.7 billion, up 236% year-over-year.”

Hock Tan, President and CEO of Broadcom Inc.

Margins, costs and tax

  • Non-GAAP gross margin near 75 percent: Non-GAAP gross margin was $22.2 billion, up from $17.1 billion in the prior quarter. Against $29.6 billion of revenue, this is about 75 percent (computed from the reconciliation). Source
  • Non-GAAP tax provision rose: The non-GAAP tax provision was $3.1 billion, against $2.2 billion in the prior quarter. Cash paid for income taxes was $347 million. Source
  • Stock-based compensation $2.0 billion: Total stock-based compensation was $2,019 million, against $2,092 million in the prior quarter and $2,322 million a year earlier. Source
  • Acquisition intangibles amortization $1.5 billion: Amortization of acquisition-related intangibles in cost of revenue was $1,499 million, against $1,461 million in the prior quarter. Source

Cash flow and balance sheet

  • Free cash flow of $13.7 billion: Operating cash flow of $14.2 billion, less $0.5 billion of capital expenditures, gave free cash flow equal to 46 percent of revenue. Source
  • Trade receivables rose to $13.7 billion: Trade accounts receivable were $13.7 billion, against $10.8 billion at May 3, 2026. Inventory was $4.5 billion, against $4.3 billion. Source
  • Cash balance rose to $24.0 billion: Cash and cash equivalents were $24.0 billion at quarter end, against $19.6 billion at the end of the prior quarter. Source

“Broadcom achieved record revenue, operating profit and free cash flow in Q3.”

Amie Thuener, CFO of Broadcom Inc.

Capital and shareholder returns

  • No share repurchases this quarter: Repurchases under the program were nil in the quarter, against $600 million in the second quarter and $8.45 billion in the three fiscal quarters to date. Source
  • Dividend of $3.1 billion paid: A $0.65 per share dividend was paid on June 30, 2026, totaling $3.1 billion. Source
  • Debt payments of $5.6 billion: Payments on debt obligations were $5.6 billion in the quarter. Long-term debt was $57.2 billion, against $62.7 billion at May 3, 2026. Source

Spending and reporting

  • Capital spending of $0.5 billion: Purchases of property, plant and equipment were $532 million, against $231 million in the prior quarter and $142 million a year earlier. Source
  • Non-GAAP R&D down from prior quarter: Non-GAAP research and development was $1,551 million, against $1,600 million in the prior quarter and $1,477 million a year earlier. Source
  • Adjusted EBITDA absent this quarter: The release does not show Adjusted EBITDA, which the prior release reported at $15.2 billion for the second quarter. No Adjusted EBITDA guidance is given for the fourth quarter. Source

Coming up, as management said on 2 September 2026

  • Dividend payable September 30: The $0.65 dividend is payable September 30, 2026, to holders of record at the close of business on September 21, 2026. Source
  • Fourth quarter closes November 1: The fourth quarter of fiscal 2026 ends November 1, 2026, the period covered by the guidance given in this release. Source

In management's words

“and we expect to maintain our non-GAAP operating margin at 66%, flat from a year ago.”

Amie Thuener, CFO of Broadcom Inc.

Figures management reported

FigureReported
AI semiconductor revenue Source$16.7 billion, up 221% year-over-year
Gross margin Source$20,456 million (GAAP)

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.