On the 3rd local time, Broadcom released its first-quarter 2022 financial report and second-quarter financial forecast. Net revenue in the first quarter increased by 16% year-on-year to a record $7.7 billion, higher than Wall Street’s expected $7.6 billion. Quarterly net revenue will be $7.9 billion, above analysts' average estimate of $7.43 billion.

"Broadcom's record first-quarter results were driven by strong enterprise demand and continued investment in next-generation technologies by hyperscalers and service providers," Broadcom CEO Hock Tan said in a combined Reuters and Bloomberg report. Our second-quarter outlook expects year-over-year growth to accelerate."

Broadcom's customer list includes many companies that are heavily invested in cutting-edge technologies. Google uses Broadcom's networking chips in its data centers, and Apple's iPhones also rely on Broadcom's connectivity chips to connect Wi-Fi networks and peripherals, making Broadcom's predictions misplaced. It is considered to be one of the weather vanes of the overall prosperity of the chip industry.

Regarding the current order situation, Hock Tan said that there are enough orders by the end of this year and part of 2023. Chief Financial Officer Kirsten Spears said the company had a backlog of more than $25 billion in hardware orders at the end of the quarter, up from $22 billion in the previous quarter.

Hock Tan said that to address the shortage, he told customers that orders would need to be placed long in advance to ensure supply, and had a non-cancellation policy that Broadcom would intentionally refuse when it felt a device maker asked for more than it needed. partial order.

Hock Tan cited these policies and the lack of inventory as proof that the chip industry will not experience a supply glut, but also refused to abandon his long-term view that overall growth will slow as the semiconductor industry matures.

"We believe that demand from most of Broadcom's end markets and key customers remains healthy in the near term," said Kingai Chan, an analyst at Summit Insights Group. "However, our survey did show repeat orders from the company's customers, We expect demand to begin to normalize in the second half of 2022 as supply improves."