Analysis of the Form 10-K | Fiscal year ended 11/02/2025
FY2025, ended 11/02/2025. Financial statements in US dollars; amounts in US$ millions (mn) unless otherwise stated. The price used for the multiples is the closing price supplied, referenced to 11/2/2025. The share count is the cover-page figure, at 11/28/2025.
Broadcom designs and sells two very different things. The first is semiconductors and semiconductor-based systems: custom accelerators (XPUs), Ethernet switches, network interface cards, optical components, radio-frequency modules for smartphones, storage controllers, chips for set-top boxes and broadband, industrial components. The second is infrastructure software: the VMware Cloud Foundation private-cloud platform, mainframe software, cybersecurity (Symantec, Carbon Black), enterprise software and fibre channel storage networking management.
Chip customers are hyperscalers, companies with frontier AI models, equipment manufacturers (OEMs) and their contract manufacturers. According to the document, distributors and OEMs "typically account for the substantial majority of our semiconductor sales"; sales to distributors account for 48% of total revenue. Software is sold to large enterprises and government agencies, directly or through resellers. For chips, revenue is recognized on transfer of control, with payment terms described as "short-term in duration". For software, licenses without a termination right are recognized upfront, while contracts with termination for convenience and support are recognized over time.
The document defines two segments: "semiconductor solutions", which also includes intellectual property licensing, and "infrastructure software", which also includes the fibre channel storage area networking (FC SAN) business.
Revenue by segment (US$ mn)
| Segment | FY2025 | % | FY2024 | % | FY2023 | % | YoY 25/24 | YoY 24/23 |
|---|---|---|---|---|---|---|---|---|
| Semiconductor solutions | 36,858 | 57.7% | 30,096 | 58.4% | 28,182 | 78.7% | +22.5% | +6.8% |
| Infrastructure software | 27,029 | 42.3% | 21,478 | 41.6% | 7,637 | 21.3% | +25.8% | +181.2% |
| Total | 63,887 | 100% | 51,574 | 100% | 35,819 | 100% | +23.9% | +44.0% |
Revenue by geographic region, based on delivery location (US$ mn)
| Region | FY2025 | % | FY2024 | % | FY2023 | % | YoY 25/24 | YoY 24/23 |
|---|---|---|---|---|---|---|---|---|
| Asia Pacific | 35,896 | 56.2% | 28,422 | 55.1% | 23,920 | 66.8% | +26.3% | +18.8% |
| Americas | 18,939 | 29.6% | 14,970 | 29.0% | 8,279 | 23.1% | +26.5% | +80.8% |
| EMEA | 9,052 | 14.2% | 8,182 | 15.9% | 3,620 | 10.1% | +10.6% | +126.0% |
| Total | 63,887 | 100% | 51,574 | 100% | 35,819 | 100% | +23.9% | +44.0% |
FY2025 revenue by country of delivery (Note 13)
| Country | US$ mn | % |
|---|---|---|
| United States | 16,506 | 25.8% |
| China (incl. Hong Kong) | 11,155 | 17.5% |
| Singapore | 10,796 | 16.9% |
| Taiwan | 6,451 | 10.1% |
| Other countries | 18,979 | 29.7% |
| Total | 63,887 | 100% |
The document warns that the breakdown follows delivery location and that "a substantial portion of our products shipped or delivered to China (including Hong Kong) is included in devices sold by our end customers in the United States and Europe".
At November 2, 2025 the company had approximately 33,000 employees, 57% of them in research and development. The document does not provide the figure for prior years.
The executive officers listed as of December 18, 2025 are Hock E. Tan (CEO since 2006), Kirsten M. Spears (CFO since 2020), Mark D. Brazeal and Charlie B. Kawwas. The document does not report changes among the signatories or the executive officers during the year.
New or modified items introduced by the document this year:
The document reports approximately 19,000 patents and 2,170 pending applications. Expiration dates range from 2025 to 2044 and the company states that it is not dependent on any single patent.
R&D / revenue = 10,977 / 63,887 = 17.2%.
In software, the strength of the position shows in segment margins.
Software operating margin = 20,765 / 27,029 = 76.8%. Software segment gross margin = (27,029 − 1,902) / 27,029 = 93.0%.
In semiconductors, the document points to long-standing customer relationships and some proprietary in-house processes: FBAR filters (Fort Collins fab, sole source) and the indium phosphide-based wafers used in fibre optics products (Breinigsville, sole source).
Semiconductor operating margin = 21,232 / 36,858 = 57.6%.
The advantage has limits declared by the company itself. The document expects more competition also from "new companies, including some of our customers" entering its markets. Manufacturing depends on TSMC, which produced approximately 95% of the wafers manufactured by third parties.
The document does not provide average selling prices, price lists or price revisions, for either chips or software. Pricing power can therefore only be inferred from margins and mix.
| Indicator | FY2025 | FY2024 | FY2023 |
|---|---|---|---|
| Semiconductor segment gross margin ((revenue − cost of revenue) / revenue) | 68.1% | 67.4% | 70.0% |
| Software segment gross margin | 93.0% | 89.3% | 91.9% |
| Semiconductor segment operating margin | 57.6% | 55.7% | 58.5% |
| Software segment operating margin | 76.8% | 65.1% | 73.8% |
In software, operating margin rose by 11.7 points (76.8% − 65.1%). The document attributes revenue growth to demand for VCF, to upfront license revenue on contracts without a termination right and to the transition to a subscription model, and the margin improvement also to lower labor costs after the VMware integration. How much of this comes from price increases cannot be separated with the data in the document.
In semiconductors, the FY2025 segment gross margin (68.1%) is lower than in FY2023 (70.0%). The document flags three pressures on prices or costs: TSMC "has raised, and may in the future raise, their prices"; AI customers "have made greater demands on us with regards to pricing and contractual terms"; the sale of AI racks "will likely increase our operating margin but compress or lower future gross margin".
There were no acquisitions in FY2025 (cash flow statement: zero under acquisitions); there was instead a sale of businesses for 300 mn of proceeds, with a 72 mn reduction in goodwill. The comparison with FY2024 remains impure for two further reasons: VMware has been consolidated since November 22, 2023, so FY2024 does not contain roughly the first three weeks of VMware; FY2024 had 53 weeks against 52 in FY2025.
The document provides a pro forma figure that neutralizes the first effect.
FY2025 revenue growth on FY2024 pro forma = 63,887 / 52,188 − 1 = +22.4% (reported: +23.9%).
The FY2024 pro forma is still a 53-week year: the comparison still penalizes FY2025 by one week, whose value the document does not quantify.
For FY2024 the acquisition effect dominates: VMware contributed 12,384 mn of revenue.
FY2024 revenue growth excluding VMware = (51,574 − 12,384) / 35,819 − 1 = +9.4%.
FY2024 pro forma growth = 52,188 / 48,227 − 1 = +8.2%.
The document does not break down semiconductor revenue by product: segment growth (+22.5%) is attributed to "custom AI accelerators and AI networking products", without figures. Upfront license revenue rose from 4,601 to 7,800 mn.
Share of software revenue FY2025 = 7,800 / 27,029 = 28.9%. Share FY2024 = 4,601 / 21,478 = 21.4%.
A growing portion of software revenue is therefore recognized in a single amount at signing, rather than over the life of the contract.
| Item | FY2025 | FY2024 | Change |
|---|---|---|---|
| Revenue | 63,887 | 51,574 | +23.9% |
| Cost of products sold | 12,115 | 9,805 | +23.6% |
| Cost of subscriptions and services | 2,371 | 2,983 | −20.5% |
| Research and development (GAAP) | 10,977 | 9,310 | +17.9% |
| Selling, general and administrative (GAAP) | 4,211 | 4,959 | −15.1% |
| Segment R&D, excluding SBC | 5,957 | 5,847 | +1.9% |
| Segment SG&A, excluding SBC | 2,291 | 2,876 | −20.3% |
| Stock-based compensation | 7,568 | 5,670 | +33.5% |
| Amortization of intangibles | 8,062 | 9,267 | −13.0% |
Operating leverage is strong on cash costs: segment research and SG&A grow little or decline while revenue rises 23.9%.
There is no leverage on the cost of products. Products revenue includes software licenses, whose costs are described as "immaterial"; they therefore have to be excluded for the comparison.
Products revenue excluding licenses = 44,847 − 7,800 = 37,047 (FY2024: 34,960 − 4,601 = 30,359); growth = 37,047 / 30,359 − 1 = +22.0%, against +23.6% for cost of products sold.
The item growing faster than revenue is stock-based compensation, which the document identifies as the main cause of the increase in research spending: "The increase was primarily due to higher stock-based compensation". Part of the improvement in the GAAP operating margin, from 26.1% to 39.9%, comes from lower VMware-related amortization and restructuring charges, not from efficiency.
| Item (US$ mn) | FY2025 | FY2024 | FY2023 | Chg. 25/24 | Chg. 24/23 |
|---|---|---|---|---|---|
| Revenue | 63,887 | 51,574 | 35,819 | +23.9% | +44.0% |
| Cost of revenue | 20,593 | 19,065 | 11,129 | +8.0% | +71.3% |
| Gross profit | 43,294 | 32,509 | 24,690 | +33.2% | +31.7% |
| Gross margin | 67.8% | 63.0% | 68.9% | +4.7 pt | −5.9 pt |
| Research and development | 10,977 | 9,310 | 5,253 | +17.9% | +77.2% |
| Selling, general and administrative | 4,211 | 4,959 | 1,592 | −15.1% | +211.5% |
| Amortization of intangibles (opex) | 2,031 | 3,244 | 1,394 | −37.4% | +132.7% |
| Restructuring and other charges | 591 | 1,533 | 244 | −61.4% | +528.3% |
| Operating income | 25,484 | 13,463 | 16,207 | +89.3% | −16.9% |
| Operating margin | 39.9% | 26.1% | 45.2% | +13.8 pt | −19.1 pt |
| Interest expense | (3,210) | (3,953) | (1,622) | −18.8% | +143.7% |
| Other income, net | 455 | 406 | 512 | +12.1% | −20.7% |
| Pre-tax income | 22,729 | 9,916 | 15,097 | +129.2% | −34.3% |
| Income taxes | (397) | 3,748 | 1,015 | n.m. | +269.3% |
| Net income | 23,126 | 5,895 | 14,082 | +292.3% | −58.1% |
| Net margin | 36.2% | 11.4% | 39.3% | ||
| Diluted EPS (US$) | 4.77 | 1.23 | 3.30 | +287.8% | −62.7% |
| Weighted-average diluted shares (mn) | 4,853 | 4,778 | 4,272 | +1.6% | +11.8% |
FY2025 revenue, operating income and net income are the highest among the years presented in the document (FY2023-FY2025).
FY2025 net income is inflated by the tax line: a benefit of 397 mn instead of an expense. Taxing pre-tax income at the taxes actually paid in cash lowers the result.
Income with cash taxes = 22,729 − 2,589 = 20,140; gap = 20,140 / 23,126 − 1 = −12.9%.
FY2024 income, on the other hand, is depressed by a non-recurring tax charge linked to the intra-group transfer of intellectual property to the United States, which alone accounts for 39.6 points of tax rate.
| Item (US$ mn) | 11/02/2025 | 11/03/2024 |
|---|---|---|
| Cash and cash equivalents | 16,178 | 9,348 |
| Senior notes (principal) | 65,370 | 56,252 |
| Term loans (principal) | 1,750 | 13,595 |
| Finance leases | 0 | 39 |
| Operating lease liabilities | 1,325 | 1,350 |
| Gross debt, principal including leases | 68,445 | 71,236 |
| Net financial position (net debt) | 52,267 | 61,888 |
| Stockholders' equity | 81,292 | 67,678 |
| Goodwill + intangibles | 130,074 | 138,456 |
FY2025 gross debt = 65,370 + 1,750 + 0 + 1,325 = 68,445. Net debt = 68,445 − 16,178 = 52,267. At carrying value, net of discount and issuance costs, financial debt is 65,136 mn (3,152 + 61,984). The document does not present marketable securities as a separate line.
Goodwill and intangibles / total assets = (97,801 + 32,273) / 171,092 = 76.0%.
Tangible equity = 81,292 − 130,074 = −48,782 mn.
All debt is fixed-rate following the repayment of the floating-rate 2023 term loans.
Principal maturities (Note 10)
| FY2026 | FY2027 | FY2028 | FY2029 | FY2030 | Thereafter | Total |
|---|---|---|---|---|---|---|
| 3,152 | 2,500 | 7,120 | 4,655 | 6,406 | 43,287 | 67,120 |
The document reports an undrawn US$7.5 billion revolving credit facility and compliance with all debt covenants.
| Item (US$ mn) | FY2025 | FY2024 | FY2023 |
|---|---|---|---|
| Operating cash flow | 27,537 | 19,962 | 18,085 |
| Capex | (623) | (548) | (452) |
| Free cash flow (FCF) | 26,914 | 19,414 | 17,633 |
| SBC (from CF) | 7,568 | 5,741 | 2,171 |
| FCF net of SBC | 19,346 | 13,673 | 15,462 |
| Cash paid for income taxes | 2,589 | 3,155 | 1,782 |
| Dividends paid | 11,142 | 9,814 | 7,645 |
| Buybacks (program) | 2,450 | 7,176 | 5,824 |
| Shares withheld for tax withholdings | 3,860 | 5,216 | 1,861 |
| Buybacks + withholdings | 6,310 | 12,392 | 7,685 |
FY2025 FCF = 27,537 − 623 = 26,914; FCF net of SBC = 26,914 − 7,568 = 19,346.
In FY2025 the company sold receivables on a non-recourse basis for 7,401 mn (5,900 mn in FY2024) and presents the proceeds within operating cash flows. The document does not disclose the year-end balance of receivables sold: the net effect of factoring on operating cash flow therefore cannot be calculated.
Dilution was not neutralized, despite 6,310 mn spent on buybacks and tax withholdings.
Shares outstanding = 4,686 + 88 issued − 16 repurchased − 17 withheld = 4,741 million; change = 4,741 / 4,686 − 1 = +1.2%.
SBC / revenue = 7,568 / 63,887 = 11.8% (FY2024: 5,670 / 51,574 = 11.0%).
The future cost is already committed. Unrecognized compensation cost on outstanding awards is 23,833 mn, to be expensed over a weighted-average 3.4 years. The portion attributed to FY2026 is 8,301 mn, more than the SBC for the whole of FY2025, and it excludes awards to be granted in the future. In FY2025, 120 million RSUs were granted, at an average value of US$192.37.
Owner earnings, without double-counting SBC (GAAP net income is already net of SBC, which is therefore neither added back nor deducted again):
Both versions add back the amortization of acquired intangibles. For a company that has grown through acquisitions, that cost represents the price paid to buy revenue; treating it as a recurring cost, the starting point is FCF net of SBC, 19,346 mn.
| Metric | FY2025 | FY2024 | FY2023 |
|---|---|---|---|
| Gross margin | 67.8% | 63.0% | 68.9% |
| Operating margin | 39.9% | 26.1% | 45.2% |
| Net margin | 36.2% | 11.4% | 39.3% |
| EBITDA (op. income + amort. of intangibles + depreciation) | 34,120 | 23,323 | 19,956 |
| FCF / revenue | 42.1% | 37.6% | 49.2% |
| SBC / revenue | 11.8% | 11.0% | 6.1% |
| FCF / net income conversion | 116.4% | 329.3% | 125.2% |
| Interest coverage (op. income / interest expense) | 7.9x | 3.4x | 10.0x |
| Gross debt / EBITDA | 2.01x | 3.05x | not available |
| Net debt / EBITDA | 1.53x | 2.65x | not available |
| ROIC (on year-end invested capital) | 16.9% | 7.1% | not available |
FY2025 EBITDA = 25,484 + 8,062 + 574 = 34,120. EBITDA starts from GAAP operating income, which is already net of amortization, depreciation and SBC: amortization and depreciation are added back only once and SBC remains a cost.
Gross debt / EBITDA = 68,445 / 34,120 = 2.01x. Net debt / EBITDA = 52,267 / 34,120 = 1.53x. For FY2024: 71,236 / 23,323 = 3.05x and 61,888 / 23,323 = 2.65x.
Interest coverage = 25,484 / 3,210 = 7.9x (FY2024: 13,463 / 3,953 = 3.4x; FY2023: 16,207 / 1,622 = 10.0x).
FCF / net income conversion = 26,914 / 23,126 = 116.4%. The FY2024 figure (19,414 / 5,895 = 329.3%) is distorted by income depressed by the non-recurring FY2024 tax charge and is not meaningful.
ROIC = NOPAT / year-end invested capital, same method for both years. NOPAT uses the cash tax rate, because the FY2025 book tax rate is negative.
Tangible invested capital = 133,559 − 97,801 − 32,273 = 3,485; return = 22,579 / 3,485 = 648%.
The operating business requires very little physical capital. The return relevant to shareholders is the one on capital including acquisitions (16.9%).
Multiples, calculated only with the closing price at 11/2/2025 and the shares outstanding at 11/28/2025:
| Multiple | Formula | Result |
|---|---|---|
| Market capitalization | 369.63 × 4,741,273,799 | US$1,752,517 mn |
| Enterprise value | 1,752,517 + 68,445 − 16,178 | US$1,804,784 mn |
| P/E (on diluted EPS) | 369.63 / 4.77 | 77.5x |
| P/E (market cap / net income) | 1,752,517 / 23,126 | 75.8x |
| P/E with cash taxes | 1,752,517 / (22,729 − 2,589) | 87.0x |
| P/FCF | 1,752,517 / 26,914 | 65.1x |
| FCF yield | 26,914 / 1,752,517 | 1.54% |
| FCF yield net of SBC | 19,346 / 1,752,517 | 1.10% |
| Owner earnings yield (version B) | 28,153 / 1,752,517 | 1.61% |
| P/S | 1,752,517 / 63,887 | 27.4x |
| EV/EBITDA | 1,804,784 / 34,120 | 52.9x |
| P/B | 1,752,517 / 81,292 | 21.6x |
| Dividend yield | 2.360 / 369.63 | 0.64% |
Concentration on one customer (potential, rising). A single customer, a distributor in the semiconductor segment, accounts for 32% of FY2025 revenue, against 28% in FY2024 and 21% in FY2023. The same customer accounts for 44% of trade receivables, against 18% a year earlier. The top five end customers account for approximately 40% of revenue. It matters because a single commercial relationship drives a third of revenue and almost half of receivables.
New AI business model with deferred payments (potential). The document states that AI customers seek to "lease AI racks or systems based on our XPUs instead of purchasing", with "alternative financings" and "novel or deferred payment models", and that some of these customers "may have constrained resources or capital". The document does not quantify the revenue or receivables tied to these arrangements. It matters because it shifts credit risk onto Broadcom and, according to the company itself, will compress gross margin.
AI cyclicality (potential). The document describes the industry as "highly cyclical" and the AI cycle as "a significant upturn, which may not be sustainable". FY2025 semiconductor growth (+22.5%) is attributed to custom accelerators and AI networking. It matters because this is the component that drove segment growth, and the document does not say how much of it flows through the top customer.
Manufacturing dependence (potential). TSMC produced approximately 95% of the wafers manufactured by third parties; approximately two-thirds of materials come from five suppliers, some of them single-source. The document cites "geopolitical turmoil (including China-Taiwan relations)". It matters because there is no quick manufacturing alternative.
Debt (potential, under control). Principal debt of 67,120 mn, interest expense of 3,210 mn. Among the consequences, the document lists the need to "dedicate a substantial portion of our cash flow from operations to payments on our indebtedness". Net debt / EBITDA has fallen to 1.53x, but 7,120 mn matures in FY2028.
Taxes (partly materialized). Singapore and Malaysia tax incentives reduced FY2025 taxes by approximately 2,709 mn. The document expects the global minimum tax, effective in Singapore from FY2026, to have a "material" impact on results and cash flows. There remain 3,174 mn of unrecognized tax benefits and a possible liability if the VMware spin-off from Dell were found not to be tax-free. Materialized: the 1,321 mn valuation allowance against CAMT credits.
VMware software and regulatory investigations (potential). The document cites investigations "from regulatory authorities in Korea, Japan and the European Union into certain of our contracting and business practices", without amounts. 67% of contract liabilities relate to contracts with termination for convenience. The risk of workloads migrating to the public cloud is disclosed. It matters because of the weight of software.
Software share of segment operating income = 20,765 / (21,232 + 20,765) = 49.4%.
Dilution from stock-based compensation (materialized). SBC of 7,568 mn, shares outstanding +1.2% despite buybacks, 23,833 mn of future cost already committed. It matters because it permanently reduces each shareholder's share of earnings.
China exposure and export controls (potential). Deliveries to China including Hong Kong total 11,155 mn, 17.5% of revenue. The document states that government restrictions "will likely limit or prevent us from doing business with certain of our customers or suppliers".
Key person and litigation (partly materialized). Success depends "in particular" on Hock E. Tan, aged 74; no senior manager has a written employment contract and there is no key person life insurance. Materialized: the VMware backlog class action, settled with court approval in March 2025 for an amount the document does not disclose; 204 mn of IP litigation charges in FY2023; unauthorized exposure of source code in the past.
The 10-K refers to the 2026 proxy statement for the board, compensation, ownership and related parties (Part III, Items 10-14). That information is not in the document.
The document establishes that there is a single listed class of common stock, with 2,061 holders of record at November 28, 2025. Based on the signatures, the board consists of Henry Samueli (Chairman), Eddy W. Hartenstein (Lead Independent Director), Hock E. Tan, Diane M. Bryant, Gayla J. Delly, Kenneth Y. Hao, Check Kian Low, Justine F. Page and Harry L. You. Holdings of directors and major shareholders are not disclosed.
On compensation the document lists only the plans and agreements filed: severance agreements with Hock E. Tan, Charlie B. Kawwas and Mark D. Brazeal; a new form of PSU award tied to an operating metric, filed on September 9, 2025; policies on acceleration of awards on death or disability. Amounts and targets are not in the document. Under "Insider Trading Arrangements" (Item 9B) the document reports "None".
Related-party transactions: the document does not provide this information.
Auditor: PricewaterhouseCoopers LLP. The document states "We have served as the Company's auditor since 2006". The opinion on the financial statements and on internal control is unqualified.
Policies and changes during the year. The financial statements are prepared under US GAAP. Changes: adoption of ASU 2023-07 on segment disclosures; reclassification of upfront license revenue from services revenue to products revenue (4,601 mn in FY2024, 1,058 mn in FY2023), with related costs described as "immaterial". No restatement for errors.
Critical Audit Matter. The auditor identifies only one: revenue recognition for software and support in the infrastructure software segment (27,029 mn). The sensitive point is the distinction between contracts without a termination right, whose license is recognized upfront, and contracts with termination for convenience, accounted for as "a series of daily contracts".
Accounting choices that shift earnings:
GAAP and non-GAAP. The 10-K does not present non-GAAP measures or reconciliations. The closest measure is segment operating income, which excludes four items: amortization of acquired intangibles, stock-based compensation, restructuring and other charges, acquisition-related costs.
Excluded costs = 8,062 + 7,568 + 667 + 216 = 16,513. GAAP operating income = 41,997 (sum of segments) − 16,513 = 25,484.
Taxes. FY2025 effective tax rate of −1.7% against a 21% federal statutory rate. The Note 12 reconciliation:
| Item | FY2025 rate points |
|---|---|
| Statutory rate | 21.0 |
| Foreign income taxed at different rates (Singapore, Malaysia) | −14.9 |
| Deemed inclusion of foreign earnings | +7.1 |
| Change in valuation allowance (CAMT credits) | +5.8 |
| Releases and settlements from statute expirations | −7.9 |
| Excess tax benefits from SBC | −9.6 |
| Research and development credit | −3.8 |
| Other items (state, tax contingency interest, other) | +0.6 |
| Effective rate | −1.7 |
The releases from statute expirations stem from 3,162 mn of unrecognized tax benefits that lapsed during the year. Lapses depend on the audit calendar, SBC benefits on the share price at vesting: neither item is assured in subsequent years.
Cash tax rate = 2,589 / 22,729 = 11.4%.
Contracts already signed. Remaining performance obligations on multi-year contracts without termination rights total approximately 33.3 billion. The company expects to recognize approximately 35% of this over the next 12 months.
12-month portion = 33.3 × 0.35 = 11.7 billion.
The document warns that the figure excludes contracts with termination rights and that these amounts "are not indicative of revenue for future periods".
Rising investment. The document states: "We expect capital expenditures to be higher in fiscal year 2026 as compared to fiscal year 2025". Together with the description of AI racks based on XPUs, it points to an expansion of the systems offering beyond the single chip, with an expected positive effect on operating margin and a negative one on gross margin.
New VMware Cloud Foundation releases. The "VMware cloud foundation July 2025 releases" research project, valued at 750 mn at the merger date, is expected in the first half of FY2026.
Capital returns. 7,550 mn remains under the 10 billion buyback program, extended to December 31, 2026. On December 9, 2025 the board declared a quarterly dividend of US$0.65 (Note 16, Subsequent Events).
Annualized dividend = 0.65 × 4 = US$2.60; change = 2.60 / 2.360 − 1 = +10.2%. This is a mechanical calculation, not a company commitment.
Declining amortization and integration charges. Expected amortization of intangibles falls to 7,880 mn in FY2026 and VMware-related restructuring is "substantially completed". GAAP earnings benefit with no change in cash.
The attached document is a single 10-K. Prior-year expectations can be reconstructed only where this document reports them: the table of research projects acquired with VMware (with the release dates expected at the merger date), the buyback programs and the financings with maturities.
| Item | Stated | Delivered | Variance |
|---|---|---|---|
| VCF, March 2025 releases (2,900 mn) | Release expected in FY2025 | 1,380 mn released in FY2024 and 1,520 in FY2025 | Met |
| VCF, July 2025 releases (750 mn) | Release expected in FY2025 | Now expected in the first half of FY2026 | Delay of at least one quarter |
| VCF July 2024, networking and security (1,080 mn in total) | Release expected in FY2024 | Released in FY2024 | Met |
| US$10 billion buyback program (April 2025) | Up to 10 billion by 12/31/2025 | 2,450 mn used (24.5%) | Deadline extended to 12/31/2026 |
| 2021-2022 buyback programs (20 billion) | By 12/31/2023 | Fully used | Met |
| 2023 term loans for VMware (30,390 mn) | Floating-rate financing | Remaining 13,595 mn fully repaid in FY2025 | Repayment completed |
| VMware-related restructuring | Business integration | Restructuring charges (Note 15) from 1,787 mn (FY2024) to 597 mn (FY2025); "substantially completed" | Phase concluded |
| Margin, capex or business plan targets | Not reported by the document | — | Comparison not possible |
A comparison on margin, capex and guidance targets is not possible: the 10-K does not report prior-year quantitative commitments and the FY2024 10-K is not attached.
Operating quality is high and documented: segment margins between 57.6% and 76.8%, FCF above net income, declining debt. Earnings quality is lower than net income suggests, for three measurable reasons: favorable non-recurring taxes, net dilution despite buybacks, software revenue increasingly recognized upfront.
The price embeds a great deal of future growth. FCF yield = 26,914 / 1,752,517 = 1.54%.
The notes issued in September 2025 carry effective rates between 4.34% (due 2030) and 4.99% (due 2038): the FCF yield is below even the lower of the two. Bringing the FCF yield to 4.34% on the fiscal year-end market capitalization would require FCF of 1,752,517 × 4.34% = 76,059 mn, i.e. 2.83 times FY2025 FCF (76,059 / 26,914). At the FY2025 FCF growth rate (26,914 / 19,414 − 1 = +38.6%), this would take approximately 3.2 consecutive years of unchanged growth (ln 2.83 / ln 1.386 = 3.2): an arithmetic calculation, not a forecast. Net of SBC, the yield falls to 1.10%.
The thesis holds under three conditions: that AI growth continues without the top customer cutting orders; that the leasing and deferred-payment arrangements for racks do not turn revenue into long-term receivables; that software keeps margins above 70% once the share of upfront license revenue stops growing. At a price of 65.1 times FCF, the failure of even one condition leaves no margin of safety.
Metrics to monitor in the coming quarters:
Report based on the Broadcom Inc. Form 10-K for the fiscal year ended 11/2/2025, signed on 12/18/2025 (the SEC filing date is not stated in the document). The multiples use the closing price at 11/2/2025 and the shares outstanding at 11/28/2025 supplied with the assignment. This report is for analytical purposes only and does not constitute investment advice.
The full data table behind this report — every line item with its source in the filing and the arithmetic checks — is published separately: Broadcom FY2025 data table.