Broadcom Software Group beat Wall Street expectations for Q3 with a revenue of $6.78 billion.
The semiconductor and infrastructure software solutions giant laid out its plans for future success on Tuesday at its Software Investor Day, describing plans to continue building a comprehensive portfolio of software solutions.
Tom Krause, president of Broadcom Software Group, said the company will continue investing in its "targeted model of partnering with the largest multinational customers to provide a comprehensive portfolio of industry-leading solutions and generate sustainable revenue."
"Broadcom is continuing to build one of the world's leading enterprise software businesses committed to customer success," Krause said.
"With an addressable market today of more than $100 billion, Broadcom Software has significant opportunities to capitalize on a clear customer need for scalability, agility and security to power their most complex hybrid IT environments and accelerate our long-term growth."
The company noted that about 80% of its strategic customers are licensed to at least five solutions. They provide infrastructure software tools for mainframes, value stream management, AIOps, network monitoring, DevOps, and workload automation. Broadcom is also heavily involved in network and information security, endpoint security, payment security, access management, and identity management.
Broadcom Software has more than 3,200 patents, and about 80% of its workforce is dedicated to R&D efforts. The company invests about 14% of its revenue into R&D.
For Q3, Broadcom Software beat Wall Street expectations, reporting a revenue of $6.78 billion on the back of its semiconductors, which are used in data centers, networking gear, broadband and wireless devices, and industrial plants. In Q3, the segment brought in $5.021 billion, up 19% year-over-year.
At the event, Broadcom Software executives touted the company's work serving about 80% of the Fortune 500 with infrastructure and security software. These strategic partners represent more than 70% of Broadcom Software's annual recurring revenue.
Broadcom Software brings in $5.2 billion in annual recurring revenue, half of which involves subscriptions and has increased about 25% over the last three quarters.
Broadcom Software said it is now focusing on increasing the average duration of the deals it signs and is emphazising deals worth more than $1 million of the annualized booking value.
The executives also noted Broadcom Software's of history integrating acquired companies and businesses into its orbit. In 2019, Broadcom acquired Symantec's enterprise security portfolio for $10.7 billion. The year prior, it purchased CA Technologies for $18.9 billion.
Last Thursday, the US Federal Trade Commission slapped Broadcom with an order to stop it from entering into exclusive deals that prevent television and internet service providers (ISPs) from shopping elsewhere for key components. According to the agency, Broadcom has "illegally monopolized markets for semiconductor components used to deliver television and broadband internet services through exclusive dealing and related conduct."