Broadcom lowered its annual sales forecast and hinted at the impact of the US government's inclusion of Huawei in the blacklist of export controls.
According to a report by Bloomberg on June 14, the San Jose-based company said in a notice on June 13 that it lowered its revenue forecast for FY 2019 to US$22.5 billion (US$1 to approximately 6.9 yuan) compared to 3 The estimated $24.5 billion a month ago was down 8%, directly reducing by about $2 billion. And, this figure is also lower than analysts' expectations of $23 billion. Broadcom's share price fell 8.7% in after-hours trading.
Through a series of acquisitions, Broadcom CEO Chen Fuyang has established Broadcom as one of the world's largest semiconductor manufacturers, and its business scope is among the best in the industry. Huawei is one of its largest customers. But as the world's two major economies are caught in escalating tariff wars and some companies are blacklisted, Broadcom has become one of the many chip companies that have been hit.
“We are currently seeing a broad slowdown in the demand environment, which we believe is driven by continued geopolitical uncertainty and the impact of export restrictions on one of our large customers,” Chen Fuyang said in a statement. . “Thus, our customers are actively reducing inventory levels and we are taking a conservative position for the rest of the year. ”
As a component supplier to Apple and Samsung Electronics, Broadcom's orders are an indicator of the confidence of some of the world's largest smartphone manufacturers in their future needs. In addition, Broadcom is one of the major suppliers of network components used by large data center operators such as Google and Amazon's cloud division.
Affected by Broadcom CEO's conservative forecast for this year's results, semiconductor stocks were also dragged down after the market. Corvo plunged 5.2%, Texas Instruments fell 2.1%, and Nvidia and Analog Devices fell more than 1%.