$Broadcom(AVGO.US) Earnings report quick read: The company's earnings report for this quarter is quite good. Driven by AI revenue and the integration of VMware, the company's revenue and gross margin continue to improve. The increase in gross margin has slowed down, mainly due to the higher proportion of revenue from the semiconductor business, which has a lower gross margin.

On the operating expense side, the company continues to manage costs. The company's R&D expense ratio and selling and administrative expense ratio have decreased to 15.9% and 7.2%, respectively. The management also mentioned in previous communications that they are currently focusing on the integration of R&D and related departments in the VMware integration to reduce operating expenses and improve operational efficiency. Through the integration of operations, the company's core profit continued to rebound this quarter, with adjusted EBITDA% returning to 64.7%.

In this earnings report, Dolphin believes there are two main highlights: 1) The company's AI business revenue reached $3.7 billion this quarter, accounting for 26.3% of total revenue, better than the company's previous expectation of $3.5 billion; 2) With the progress of internal integration, while the company's adjusted EBITDA% increased this quarter, its debt repayment ability improved, with the relevant ratio (Total Debt/LTM Adjusted EBITDA) decreasing to 3.1.

After the release of Broadcom's earnings report, the company's stock price saw a slight increase. Following the conference call, the increase further rose to double digits, mainly driven by the high guidance for AI revenue. Management provided a long-term outlook (by fiscal year 2027, the addressable market for the company's ultra-large customers will reach $60-90 billion), which further enhanced market confidence in the company's AI revenue. For a detailed interpretation of the earnings report and the conference call, please follow Dolphin's subsequent content.