Broadcom's revenue forecast disappoints on possible Apple iPhone delay
(Reuters) - Broadcom Inc <AVGO.O> on Thursday forecast current-quarter revenue with a midpoint slightly below analysts' estimates, in part caused by a delay at a "large North American mobile phone" customer that analysts believe is Apple Inc <AAPL.O>.
The company forecast fiscal third-quarter revenue of about $5.75 billion, plus or minus $150 million. Analysts on average were expecting $5.79 billion, according to IBES data from Refinitiv.
"We would normally expect to see a double-digit sequential uplift in revenue from the ramp of next-generation phone at our large North American mobile phone customer," Chief Executive Hock Tan said on a conference call. "However, this year, we do not expect to see this uptick in revenue until our fourth fiscal quarter."
Tan cited a "major product cycle delay in wireless" without naming the customer, but Broadcom got about a fifth of its revenue from Apple in its most recent fiscal year and in January entered into to two multi-year agreements worth as much as $15 billion in revenue to supply Apple with wireless components.
Apple did not immediately respond to a request for comment. Analysts expect the company to release a range of 5G iPhone models later this year, but the Nikkei Asian Review reported in March that Apple was considering delaying the launch due to product development disruptions and the economic turmoil caused by the novel coronavirus pandemic.
Broadcom reported better-than-expected growth in quarterly revenue, supported by higher demand for chips used in data centers, which are ramping up as more people opt to work from home in the face of the coronavirus crisis.
Broadcom's revenue rose 4% to $5.74 billion in the second quarter ended May 3, beating analysts' average estimate of $5.69 billion.
(Reporting by Ayanti Bera in Bengaluru and Stephen Nellis in San Francisco; Editing by Anil D'Silva and Cynthia Osterman)
Alphabet Inc's Google on Wednesday announced a new hiring goal and security policy to address racial issues at its offices, as protests over police brutality against African Americans have carried into discussions about corporate culture.