Broadcom Inc.

Previous wording

•We generated $8,260 million of cash from operations.

Current wording

•We generated $10,493 million of cash from operations.

Previous wording

•We paid $3,086 million in cash dividends.

Current wording

•We paid $3,092 million in cash dividends.

Previous wording

•We repurchased $7,850 million of common stock.

Current wording

•We repurchased $600 million of common stock.

Previous wording

There were no significant changes in our critical accounting estimates during the fiscal quarter ended February 1, 2026 compared to those previously disclosed in “Critical Accounting Estimates” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the 2025 Annual Report on Form 10-K.

Current wording

There were no significant changes in our critical accounting estimates during the two fiscal quarters ended May 3, 2026 compared to those previously disclosed in “Critical Accounting Estimates” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the 2025 Annual Report on Form 10-K.

Previous wording

We are subject to risks and exposures from the evolving macroeconomic environment, including uncertainty and volatility in financial markets, efforts of governments to stimulate or stabilize the economy and other unfavorable changes in economic conditions, as well as an increase in trade tensions and related tariffs with U.S. trading partners. While difficult to isolate and quantify, these risks and exposures may cause our net revenue to fluctuate significantly and disrupt supply chain operations, and we continuously monitor the broader impacts of these circumstances on our business, our supply chain and our results of operations.

Current wording

We are subject to risks and exposures from evolving macroeconomic conditions, including uncertainty and volatility in financial markets, geopolitical events, supply constraints, efforts of governments to stimulate or stabilize the economy and other unfavorable changes in economic conditions, as well as an increase in trade tensions and related tariffs with U.S. trading partners. While difficult to isolate and quantify, these risks and exposures may cause our net revenue to fluctuate significantly and disrupt supply chain operations, and we continuously monitor the broader impacts of these circumstances on our business, our supply chain and our results of operations.

Previous wording

Fiscal Quarter Ended February 1, 2026 Compared to Fiscal Quarter Ended February 2, 2025

Current wording

Fiscal Quarter and Two Fiscal Quarters Ended May 3, 2026 Compared to Fiscal Quarter and Two Fiscal Quarters Ended May 4, 2025

Previous wording

The following table sets forth our results of operations for the periods presented:

Current wording

The following tables set forth our results of operations for the periods presented:

Previous wording

In the fiscal quarter ended February 1, 2026, we included upfront license revenue of $1,755 million within products revenue, and the related costs, which were immaterial, in cost of products sold. To conform to the current period presentation, we reclassified $1,972 million of upfront license revenue from subscriptions and services revenue to products revenue for the fiscal quarter ended February 2, 2025. We also reclassified the related costs for the upfront license revenue, which were immaterial. See Note 2. “Revenue from Contracts with Customers” in Part I, Item 1. of this Form 10-Q for additional information.

Current wording

We included upfront license revenue of $1,964 million and $3,719 million within products revenue for the fiscal quarter and two fiscal quarters ended May 3, 2026, respectively. We included the related costs, which were immaterial, in cost of products sold. To conform to the current period presentation, we reclassified $1,803 million and $3,775 million of upfront license revenue from subscriptions and services revenue to products revenue for the fiscal quarter and two fiscal quarters ended May 4, 2025, respectively. We also reclassified the related costs for the upfront license revenue, which were immaterial for the periods presented. See Note 2. “Revenue from Contracts with Customers” in Part I, Item 1. of this Form 10-Q for additional information.

Previous wording

A relatively small number of customers account for a significant portion of our net revenue. Direct sales to one semiconductor solutions customer, which is a distributor, accounted for 42% and 29% of our net revenue for the fiscal quarters ended February 1, 2026 and February 2, 2025, respectively.

Current wording

A relatively small number of customers account for a significant portion of our net revenue. Direct sales to one semiconductor solutions customer, which is a distributor, accounted for 42% of our net revenue for each of the fiscal quarter and two fiscal quarters ended May 3, 2026, and 29% of our net revenue for each of the fiscal quarter and two fiscal quarters ended May 4, 2025.

Previous wording

We believe aggregate sales to our top five end customers, through all channels, accounted for approximately 50% and 40% of our net revenue for the fiscal quarters ended February 1, 2026 and February 2, 2025, respectively. We expect to continue to experience significant customer concentration in future periods. The loss of, or significant decrease in demand from, any of our top five end customers could have a material adverse effect on our business, results of operations and financial condition.

Current wording

We believe aggregate sales to our top five end customers, through all channels, accounted for approximately 45% of our net revenue for each of the fiscal quarter and two fiscal quarters ended May 3, 2026 and 40% of our net revenue for each of the fiscal quarter and two fiscal quarters ended May 4, 2025. We expect to continue to experience significant customer concentration in future periods. The loss of, or significant decrease in demand from, any of our top five end customers could have a material adverse effect on our business, results of operations and financial condition.

Previous wording

From time to time, some of our key semiconductor customers place large orders or delay orders, causing our quarterly net revenue to fluctuate significantly. This is particularly true of our products used in AI and wireless applications as fluctuations may be magnified by the timing of customer deployments, as well as product launches. For infrastructure software, whether or not a customer has the right to terminate causes variations in revenue recognized in each period.

Current wording

From time to time, some of our key semiconductor customers place large orders or delay orders, causing our quarterly net revenue to fluctuate significantly. This is particularly true of our products used in AI and wireless applications as fluctuations may be magnified by the timing of customer deployments, as well as product launches. For infrastructure software, the relative volume of customer contracts signed with the right to terminate causes variations in revenue recognized in each period.

Previous wording

Net revenue from oursemiconductor solutions segment increased in thefiscal quarter ended February 1, 2026 compared to the prior year fiscal period due to strong demand for our networking solutions, primarily custom AI accelerators and AI networking products.

Current wording

Net revenue from oursemiconductor solutions segment increased in the fiscal quarter andtwo fiscal quarters ended May 3, 2026 compared to the prior year fiscal periods due to strong demand for our networking solutions, primarily custom AI accelerators and AI networking products.

Previous wording

Gross margin was $13,157 million for the fiscal quarter ended February 1, 2026 compared to $10,145 million for the fiscal quarter ended February 2, 2025. The increase was primarily due to strong product demand for our AI-related semiconductor solutions.

Current wording

Gross margin was $15,415 million for the fiscal quarter ended May 3, 2026 compared to $10,197 million for the fiscal quarter ended May 4, 2025 and $28,572 million for the two fiscal quarters ended May 3, 2026 compared to $20,342 million for the two fiscal quarters ended May 4, 2025. The increases were primarily due to strong product demand for our AI-related semiconductor solutions.

Previous wording

As a percentage of net revenue, gross margin was relatively flat. The gross margin benefit from our net revenue growth was offset by a higher mix of semiconductor solutions net revenue.

Current wording

As a percentage of net revenue, gross margin was 69% for each of the fiscal quarter and two fiscal quarters ended May 3, 2026, and 68% for each of the fiscal quarter and two fiscal quarters ended May 4, 2025. The increases were primarily due to the gross margin benefit from our net revenue growth, partially offset by a higher mix of semiconductor solutions net revenue, which has a lower gross margin than infrastructure software.

Previous wording

Research and development expense increased $712 million, or 32%, for the fiscal quarter ended February 1, 2026 compared to the prior year fiscal period. The increase was primarily due to higher stock-based compensation.

Current wording

Research and development expense increased $302 million, or 11%, and $1,014 million or 21%, for the fiscal quarter and two fiscal quarters ended May 3, 2026, respectively, compared to the prior year fiscal periods. The increases were primarily due to higher stock-based compensation.

Previous wording

The following table sets forth the total unrecognized compensation cost related to unvested stock-based awards outstanding and expected to vest as of February 1, 2026. The remaining weighted-average service period was 3.2 years.

Current wording

The following table sets forth the total unrecognized compensation cost related to unvested stock-based awards outstanding and expected to vest as of May 3, 2026. The remaining weighted-average service period was 3.0 years.

Previous wording

Operating income from our semiconductor solutions segment increased for the fiscal quarter ended February 1, 2026 compared to the prior year fiscal period due to strong demand for our networking solutions, primarily custom AI accelerators and AI networking products.

Current wording

Operating income from our semiconductor solutions segment increased for the fiscal quarter and two fiscal quarters ended May 3, 2026 compared to the prior year fiscal periods due to strong demand for our networking solutions, primarily custom AI accelerators and AI networking products.

Previous wording

Unallocated expenses include stock-based compensation expense, amortization of acquisition-related intangible assets, restructuring and other charges, acquisition-related costs, and other costs, which are not used in evaluating the results of, or in allocating resources to, our segments. Unallocated expenses increased 19% for the fiscal quarter ended February 1, 2026 compared to the prior year fiscal period primarily due to higher stock-based compensation expense.

Current wording

Unallocated expenses include stock-based compensation expense, amortization of acquisition-related intangible assets, restructuring and other charges, acquisition-related costs, and other costs, which are not used in evaluating the results of, or in allocating resources to, our segments. Unallocated expenses increased 4% and 12% for the fiscal quarter and two fiscal quarters ended May 3, 2026, respectively, compared to the prior year fiscal periods due to higher stock-based compensation expense.

Previous wording

Interest expense. Interest expense was $801 million and $873 million for the fiscal quarters ended February 1, 2026 and February 2, 2025, respectively. The decrease was primarily due to an overall reduction in outstanding debt balances and debt refinancing activities.

Current wording

Interest expense. Interest expense was $776 million and $769 million for the fiscal quarters ended May 3, 2026 and May 4, 2025, respectively. The increase was due to a loss on debt extinguishment. Interest expense was $1,577 million and $1,642 million for the two fiscal quarters ended May 3, 2026 and May 4, 2025, respectively. The decrease was primarily due to an overall reduction in outstanding debt balances and debt refinancing activities.

Previous wording

Other income, net. Other income, net includes interest income, gains and losses on investments, foreign currency remeasurement and other miscellaneous items. Other income, net, was $433 million and $103 million for the fiscal quarters ended February 1, 2026 and February 2, 2025, respectively. Other income, net included a $315 million gain from the reversal of excise tax charges on our acquisition of VMware, Inc. (“VMware”), as the final Inflation Reduction Act of 2022 regulations exempted purchases of common stock on acquisitions from excise tax. In addition, interest income increased as a result of higher invested balances.

Current wording

Other income, net. Other income, net includes interest income, gains and losses on investments, foreign currency remeasurement and other miscellaneous items. Other income, net, was $118 million and $551 million for the fiscal quarter and two fiscal quarters ended May 3, 2026, respectively, and $25 million and $128 million for the fiscal quarter and two fiscal quarters ended May 4, 2025, respectively. Interest income increased compared to the prior year fiscal periods as a result of higher invested balances. In addition, for the two fiscal quarters ended May 3, 2026, other income, net included a $315 million gain from the reversal of excise tax charges on our acquisition of VMware, Inc. (“VMware”), as the final Inflation Reduction Act of 2022 regulations exempted purchases of common stock on acquisitions from excise tax.

Previous wording

Our primary sources of liquidity as of February 1, 2026 consisted of: (i) $14,174 million in cash and cash equivalents, (ii) cash we expect to generate from operations and (iii) available capacity under our $7.5 billion unsecured revolving credit facility. In addition, we may also generate cash from the sale of assets, and debt or equity financings from time to time.

Current wording

Our primary sources of liquidity as of May 3, 2026 consisted of: (i) $19,628 million in cash and cash equivalents, (ii) cash we expect to generate from operations and (iii) available capacity under our $7.5 billion unsecured revolving credit facility. In addition, we may also generate cash from the sale of assets, and debt or equity financings from time to time.

Previous wording

Our short-term and long-term liquidity requirements primarily arise from: (i) working capital requirements, (ii) research and development and capital expenditure needs, (iii) cash dividend payments (if and when declared by our Board of Directors), (iv) interest and principal payments related to our $67,970 million of outstanding indebtedness with $2,252 million principal amounts payable within 12 months, (v) payment of income taxes, (vi) discretionary stock repurchases, and (vii) business acquisitions and investments we may make from time to time. Our ability to fund these requirements will depend, in part, on our future cash flows, which are determined by our future operating performance and, therefore, subject to prevailing global macroeconomic conditions and financial, business and other factors, some of which are beyond our control.

Current wording

Our short-term and long-term liquidity requirements primarily arise from: (i) working capital requirements, (ii) research and development and capital expenditure needs, (iii) cash dividend payments (if and when declared by our Board of Directors), (iv) interest and principal payments related to our $66,720 million of outstanding indebtedness with $2,252 million principal amounts payable within 12 months, (v) payment of income taxes, (vi) discretionary stock repurchases, and (vii) business acquisitions and investments we may make from time to time. Our ability to fund these requirements will depend, in part, on our future cash flows, which are determined by our future operating performance and, therefore, subject to prevailing global macroeconomic conditions and financial, business and other factors, some of which are beyond our control.

Previous wording

We believe that our cash and cash equivalents on hand, cash flows from operations and our revolving credit facility will provide sufficient liquidity to operate our business and fund our current obligations for at least the next 12 months. For additional information regarding our cash requirement from contractual obligations and indebtedness, see Note 10. “Commitments and Contingencies” and Note 6. “Borrowings” in Part I, Item 1 of this Form 10-Q.

Current wording

We believe that our cash and cash equivalents on hand, cash flows from operations and our revolving credit facility will provide sufficient liquidity to operate our business and fund our current obligations for at least the next 12 months. For additional information regarding our cash requirement from indebtedness, contractual commitments and backstops, see Note 6. “Borrowings,” Note 10. “Commitments and Contingencies” and Note 11. “Subsequent Events” in Part I, Item 1 of this Form 10-Q, as well as our disclosure in Part II, Item 5 of this Form 10-Q.

Previous wording

From time to time, we engage in discussions with third parties regarding potential acquisitions of, or investments in, businesses, technologies and product lines. Any such transaction, or evaluation of potential transactions, could require significant use of our cash and cash equivalents, or require us to increase our borrowings to fund such transactions. If we do not have sufficient cash to fund our operations or finance growth opportunities, including acquisitions, expansions of new business strategies and models, or unanticipated capital expenditures, our business and financial condition could suffer. In addition, we may agree to financial obligations, including guarantees, or increase our exposure to credit or customer default risks to support our strategic initiatives or other corporate purposes. In such circumstances, we may seek to obtain new debt or equity financing. However, we cannot assure you that such additional financing will be available on terms acceptable to us or at all. Our ability to service our outstanding indebtedness and any other indebtedness we may incur will depend on our ability to generate cash in the future. We may also elect to issue additional debt or equity securities for reasons other than those specified above. From time to time, we manage our indebtedness through financings, redemptions, repayments, exchanges, tender offers and other transactions. Such transactions will depend on prevailing market conditions, our liquidity requirements, the terms of indentures, contractual restrictions and other factors.

Current wording

From time to time, we engage in discussions with third parties regarding potential acquisitions of, or investments in, businesses, technologies and product lines. Any such transaction, or evaluation of potential transactions, could require significant use of our cash and cash equivalents, or require us to increase our borrowings to fund such transactions. If we do not have sufficient cash to fund our operations or finance growth opportunities, including acquisitions, expansions of new business strategies and models, or unanticipated capital expenditures, our business and financial condition could suffer. In addition, we may agree to financial obligations, including backstops, or increase our exposure to credit or customer default risks to support our strategic initiatives or other corporate purposes. In such circumstances, we may seek to obtain new debt or equity financing. However, we cannot assure you that such additional financing will be available on terms acceptable to us or at all. Our ability to service our outstanding indebtedness and any other indebtedness we may incur will depend on our ability to generate cash in the future. We may also elect to issue additional debt or equity securities for reasons other than those specified above. From time to time, we manage our indebtedness through financings, redemptions, repayments, exchanges, tender offers and other transactions. Such transactions will depend on prevailing market conditions, our liquidity requirements, the terms of indentures, contractual restrictions and other factors.

Previous wording

Working capital increased to $15,203 million at February 1, 2026 from $13,059 million at November 2, 2025. The increase was primarily attributable to the following:

Current wording

Working capital increased to $23,351 million at May 3, 2026 from $13,059 million at November 2, 2025. The increase was primarily attributable to the following:

Previous wording

•Trade accounts receivable, net increased to $8,460 million at February 1, 2026 from $7,145 million at November 2, 2025 primarily due to higher billings and the timing of collections.

Current wording

•Trade accounts receivable, net increased to $10,830 million at May 3, 2026 from $7,145 million at November 2, 2025 primarily due to higher semiconductor revenue, the timing of billings and lower receivables sold through factoring arrangements.

Previous wording

•Cash and cash equivalents decreased to $14,174 million at February 1, 2026 from $16,178 million at November 2, 2025, primarily due to $7,850 million of stock repurchases and $3,086 million of dividend payments, offset in part by $8,260 million in net cash provided by operating activities.

Current wording

•Cash and cash equivalents increased to $19,628 million at May 3, 2026 from $16,178 million at November 2, 2025, primarily due to $18,753 million in net cash provided by operating activities, offset in part by $8,450 million of stock repurchases and $6,178 million of dividend payments.

Previous wording

In April 2025, our Board of Directors authorized a stock repurchase program to repurchase up to $10 billion of our common stock through December 31, 2025, which was subsequently extended through December 31, 2026 and increased to $11 billion. During the fiscal quarter ended February 1, 2026, we repurchased and retired 23 million shares for $7,850 million. As of February 1, 2026, $700 million of the authorized amount remained available for repurchase under this program.

Current wording

In April 2025, our Board of Directors authorized a stock repurchase program to repurchase up to $10 billion of our common stock through December 31, 2025, which was subsequently extended through December 31, 2026 and increased to $11 billion. In March 2026, our Board of Directors authorized a stock repurchase program to repurchase up to $10 billion of our common stock from time to time through December 31, 2026. During the two fiscal quarters ended May 3, 2026 and May 4, 2025, we repurchased and retired 25 million and 16 million shares for $8,450 million and $2,450 million, respectively. As of May 3, 2026, $10.1 billion of the authorized amount remained available for repurchase.

Previous wording

During the fiscal quarter ended February 2, 2025, we paid $2,036 million in employee withholding taxes due upon the vesting of net settled equity awards and withheld 8 million shares from employees in connection with such net share settlements. In the fiscal quarter ended February 1, 2026, we settled withholding taxes upon the vesting of employee equity awards using proceeds from the sale of a portion of the vested shares.

Current wording

During the two fiscal quarters ended May 4, 2025, we paid $3,802 million in employee withholding taxes due upon the vesting of net settled equity awards and withheld 17 million shares from employees in connection with such net share settlements. In the current year fiscal period, we settled withholding taxes upon the vesting of employee equity awards using proceeds from the sale of a portion of the vested shares.

Previous wording

Cash flows from operating activities consist of net income adjusted for certain non-cash and other items and changes in assets and liabilities. The $2,147 million increase in cash provided by operations during the fiscal quarter ended February 1, 2026 compared to the prior year fiscal period was primarily due to $1,846 million higher net income and $1,055 million higher non-cash adjustments including stock-based compensation and deferred taxes and other non-cash taxes, offset in part by $754 million from changes in operating assets and liabilities.

Current wording

Cash flows from operating activities consist of net income adjusted for certain non-cash and other items and changes in assets and liabilities. The $6,085 million increase in cash provided by operations during the two fiscal quarters ended May 3, 2026 compared to the prior year fiscal period was primarily due to $6,191 million higher net income and $1,310 million higher non-cash adjustments primarily from higher stock-based compensation, offset in part by $1,416 million from changes in operating assets and liabilities.

Previous wording

Cash flows from investing activities primarily consist of capital expenditures and proceeds and payments related to investments. The cash flows from investing activities during the fiscal quarter ended February 1, 2026 was relatively flat compared to the prior year fiscal period as an increase in net proceeds from investments in the current year fiscal period was substantially offset by higher capital expenditures compared to the prior year fiscal period.

Current wording

Cash flows from investing activities primarily consist of capital expenditures and proceeds and payments related to investments. The cash flows from investing activities during the two fiscal quarters ended May 3, 2026 were relatively flat compared to the prior year fiscal period as higher capital expenditures in the current year fiscal period was substantially offset by an increase in net proceeds from investments compared to the prior year fiscal period.

Previous wording

Cash flows from financing activities primarily consist of proceeds and payments related to our borrowings, dividend payments, authorized stock repurchases, and employee withholding tax payments related to net settled equity awards. The $4,169 million increase in cash used in financing activities during the fiscal quarter ended February 1, 2026 compared to the prior year fiscal period was primarily due to stock repurchases in the current year fiscal period, offset in part by a decrease in employee withholding tax payments related to net settled equity awards and an increase in net proceeds from borrowings in the current year fiscal period compared to the prior year fiscal period.

Current wording

Cash flows from financing activities primarily consist of proceeds and payments related to our borrowings, dividend payments, authorized stock repurchases, and employee withholding tax payments related to net settled equity awards. The $2,743 million increase in cash used in financing activities during the two fiscal quarters ended May 3, 2026 compared to the prior year fiscal period was primarily due to a $6,000 million increase in stock repurchases, offset in part by $3,802 million of employee withholding tax payments related to net settled equity awards in the prior year fiscal period.