06:30 AM EDT, 06/13/2024 (MT Newswires) -- Broadcom ( AVGO ) shares spiked early Thursday after the chipmaker lifted its full-year revenue outlook on the back of a better-than-expected fiscal second quarter, buoyed by artificial intelligence demand and VMware software.

The company now anticipates revenue of about $51 billion for fiscal 2024, it said late Wednesday, up from the prior guidance of roughly $50 billion. The current consensus on Capital IQ is for revenue of $51.21 billion. The stock jumped over 14% in recent premarket activity.

Revenue from AI is now set to come in at over $11 billion for the fiscal year, while non-AI semiconductor revenue "bottomed" in the second quarter and is "likely to recover modestly for the second half," Chief Executive Hock Tan said on an earnings call, according to a Capital IQ transcript. The company is also "making very strong progress" in the integration of VMware, which it acquired in November, and accelerating its growth.

"Pulling all these three key factors together, we are raising our fiscal 2024 revenue guidance," according to Tan. Adjusted earnings before interest, taxes, depreciation and amortization are forecast to be at about 61% of projected revenue for the year, compared with the initial outlook for a 60% margin.

For the three months through May 5, revenue surged 43% to $12.49 billion, surpassing the Street's view for $12.01 billion. The semiconductor solutions segment logged revenue of $7.2 billion, up from $6.81 billion in the year before. Infrastructure software revenue soared 175% to $5.29 billion, including a $2.7 billion contribution from VMware, Tan told analysts on the call.

"Revenue from our AI products was a record $3.1 billion during the quarter," Tan said in a statement. "Infrastructure software revenue accelerated as more enterprises adopted the VMware software stack to build their own private clouds."

Adjusted earnings came in at $10.96 per share for the quarter, rising from $10.32 in the 2023 quarter, topping analysts' $10.84 estimate. Total operating expenses widened to $4.81 billion from $2.11 billion year-on-year, according to the company. Adjusted EBITDA inclined 31% to $7.43 billion, representing 59% of revenue for the period.

Meanwhile, Broadcom ( AVGO ) said it plans to begin trading on a 10-for-1 split-adjusted basis, effective July 15. The move aims to make ownership of the company's stock "more accessible to investors and to employees," Chief Financial Officer Kirsten Spears said on the call.

Price: 1,714.19, Change: +218.68, Percent Change: +14.62