Broadcom making 'good progress' with VMware acquisition

The chipmaker is talking with business regulators in a 'couple of jurisdictions'

Broadcom's CEO has said it is "making good progress" with regulators as it looks to complete its acquisition of VMware.

Hock Tan has given an update on the chipmaker's $61bn deal to acquire the virtualisation software giant during the company's quarterly financial earnings call.

Since the announcement was made in May, Broadcom has proceeded to talking with business regulators in a "couple of jurisdictions".

Should regulators agree to its purchase of VMware, Tan expects the deal to close in fiscal year 2023.

"We're making good progress with our various regulatory filings around the world," Tan said, quoted by Seeking Alpha.

"We have an excellent team focused on this effort, and we are moving forward as very much as expected in this regard.

"We continue to expect the transaction to be completed in Broadcom's fiscal year 2023."

He added the company remains "excited" about the VMware deal and continues to be impressed by the business.

"We have tremendous respect for what VMware has built," Tan said.

"And together, we will enable enterprises to accelerate innovation and expand choice by addressing the most complex technology challenges in this multi-cloud era."

This came as Broadcom reported financial results for its third quarter of fiscal year 2022, ending 31 July.

The quarter saw it achieve revenue of $8.46bn, up 25 per cent from the prior year period, as GAAP net income reached $3.07bn and adjusted EBITDA hit $5.38bn.

"Broadcom's record third quarter results were driven by robust demand across cloud, service providers, and enterprise," said Tan.

"We expect solid demand across our end markets to continue in the fourth quarter, reflecting continued investment by our customers of next generation technologies in data centres, broadband, and wireless."

It comes amid headwinds such as supply chain issues, with the IDC saying shipments of microchips are likely to be "erratic" for the remainder of 2022, despite availability of them showing early signs of improvement.

Tan said the company was meeting the "true end-demand" that was in the market.

He added: "This is something we've been talking about in earnings call and analyst calls about true demand.

"We scrub to our backlog thoughtfully, carefully before we deliver products to customers, end users -that's true end demand.

"What we reported to you today - and you see the numbers that we're presenting and the strength of the numbers - if I could say so myself, it's true end demand what we're seeing."