Item 1. Condensed Consolidated Financial Statements — Unaudited

BROADCOM INC.

INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — UNAUDITED

			Page
Condensed Consolidated Balance Sheets — Unaudited			2
Condensed Consolidated Statements of Operations - Unaudited			3
Condensed Consolidated Statements of Comprehensive Income — Unaudited			4
Condensed Consolidated Statements of Cash Flows — Unaudited			5
Condensed Consolidated Statements of Stockholders’ Equity — Unaudited			6
Notes to Unaudited Condensed Consolidated Financial Statements			8

BROADCOM INC.

CONDENSED CONSOLIDATED BALANCE SHEETS — UNAUDITED

						January 29, 2023						October 30, 2022
						(In millions, except par value)
ASSETS
Current assets:
Cash and cash equivalents						$	12,647					$	12,416
Trade accounts receivable, net						3,234						2,958
Inventory						1,899						1,925
Other current assets						1,056						1,205
Total current assets						18,836						18,504
Long-term assets:
Property, plant and equipment, net						2,201						2,223
Goodwill						43,614						43,614
Intangible assets, net						6,225						7,111
Other long-term assets						2,100						1,797
Total assets						$	72,976					$	73,249
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable						$	923					$	998
Employee compensation and benefits						536						1,202
Current portion of long-term debt						1,115						440
Other current liabilities						4,909						4,412
Total current liabilities						7,483						7,052
Long-term liabilities:
Long-term debt						38,167						39,075
Other long-term liabilities						4,016						4,413
Total liabilities						49,666						50,540
Commitments and contingencies (Note 11)
Stockholders’ equity:
Preferred stock, $0.001 par value; 100 shares authorized; none issued and outstanding						—						—
Common stock, $0.001 par value; 2,900 shares authorized; 417 and 418 shares issued and outstanding as of January 29, 2023 and October 30, 2022, respectively						—						—
Additional paid-in capital						21,119						21,159
Retained earnings						2,371						1,604
Accumulated other comprehensive loss						(180)						(54)
Total stockholders’ equity						23,310						22,709
Total liabilities and equity						$	72,976					$	73,249

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BROADCOM INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS — UNAUDITED

						Fiscal Quarter Ended
						January 29, 2023						January 30, 2022
						(In millions, except per share data)
Net revenue:
Products						$	7,082					$	6,053
Subscriptions and services						1,833						1,653
Total net revenue						8,915						7,706
Cost of revenue:
Cost of products sold						2,225						1,769
Cost of subscriptions and services						149						156
Amortization of acquisition-related intangible assets						535						730
Restructuring charges						2						2
Total cost of revenue						2,911						2,657
Gross margin						6,004						5,049
Research and development						1,195						1,206
Selling, general and administrative						348						321
Amortization of acquisition-related intangible assets						348						397
Restructuring, impairment and disposal charges						10						17
Total operating expenses						1,901						1,941
Operating income						4,103						3,108
Interest expense						(406)						(407)
Other income (expense), net						143						(14)
Income before income taxes						3,840						2,687
Provision for income taxes						66						215
Net income						3,774						2,472
Dividends on preferred stock						—						(74)
Net income attributable to common stock						$	3,774					$	2,398
Net income per share attributable to common stock:
Basic						$	9.03					$	5.82
Diluted						$	8.80					$	5.59
Weighted-average shares used in per share calculations:
Basic						418						412
Diluted						429						429

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BROADCOM INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME — UNAUDITED

						Fiscal Quarter Ended
						January 29, 2023						January 30, 2022
						(In millions)
Net income						$	3,774					$	2,472
Other comprehensive income (loss), net of tax:
Change in unrealized loss on derivative instruments						(126)						—
Change in actuarial loss and prior service costs associated with defined benefit plans						—						1
Other comprehensive income (loss), net of tax						(126)						1
Comprehensive income						$	3,648					$	2,473

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BROADCOM INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS — UNAUDITED

						Fiscal Quarter Ended
						January 29, 2023						January 30, 2022
						(In millions)
Cash flows from operating activities:
Net income						$	3,774					$	2,472
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of intangible and right-of-use assets						905						1,151
Depreciation						127						136
Stock-based compensation						391						387
Deferred taxes and other non-cash taxes						(573)						70
Non-cash interest expense						32						32
Other						(39)						15
Changes in assets and liabilities, net of acquisitions and disposals:
Trade accounts receivable, net						(276)						(468)
Inventory						26						(223)
Accounts payable						(80)						—
Employee compensation and benefits						(657)						(528)
Other current assets and current liabilities						570						521
Other long-term assets and long-term liabilities						(164)						(79)
Net cash provided by operating activities						4,036						3,486
Cash flows from investing activities:
Purchases of property, plant and equipment						(103)						(101)
Purchases of investments						—						(200)
Other						—						(8)
Net cash used in investing activities						(103)						(309)
Cash flows from financing activities:
Payments on debt obligations						(260)						(255)
Payments of dividends						(1,926)						(1,764)
Repurchases of common stock - repurchase program						(1,188)						(2,724)
Shares repurchased for tax withholdings on vesting of equity awards						(333)						(375)
Other						5						(3)
Net cash used in financing activities						(3,702)						(5,121)
Net change in cash and cash equivalents						231						(1,944)
Cash and cash equivalents at beginning of period						12,416						12,163
Cash and cash equivalents at end of period						$	12,647					$	10,219

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BROADCOM INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY — UNAUDITED

Fiscal Quarter Ended January 29, 2023

												Common Stock												Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Loss						Total Stockholders’ Equity
																		Shares						Par Value
															(In millions)
Balance as of October 30, 2022																		418						$	—					$	21,159					$	1,604					$	(54)					$	22,709
Net income																		—						—						—						3,774						—						3,774
Other comprehensive loss																		—						—						—						—						(126)						(126)
Dividends to common stockholders																		—						—						—						(1,926)						—						(1,926)
Common stock issued																		2						—						—						—						—						—
Stock-based compensation																		—						—						391						—						—						391
Repurchases of common stock																		(2)						—						(107)						(1,081)						—						(1,188)
Shares repurchased for tax withholdings on vesting of equity awards																		(1)						—						(324)						—						—						(324)
Balance as of January 29, 2023																		417						$	—					$	21,119					$	2,371					$	(180)					$	23,310

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BROADCOM INC.

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY — UNAUDITED

Fiscal Quarter Ended January 30, 2022

						8.00% Mandatory Convertible Preferred Stock												Common Stock												Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Loss						Total Stockholders’ Equity
						Shares						Par Value						Shares						Par Value
						(In millions)
Balance as of October 31, 2021						4						$	—					413						$	—					$	24,330					$	748					$	(116)					$	24,962
Net income						—						—						—						—						—						2,472						—						2,472
Other comprehensive income						—						—						—						—						—						—						1						1
Dividends to common stockholders						—						—						—						—						—						(1,689)						—						(1,689)
Dividends to preferred stockholders						—						—						—						—						—						(74)						—						(74)
Common stock issued						—						—						2						—						1						—						—						1
Stock-based compensation						—						—						—						—						387						—						—						387
Repurchases of common stock						—						—						(4)						—						(1,267)						(1,457)						—						(2,724)
Shares repurchased for tax withholdings on vesting of equity awards						—						—						(1)						—						(368)						—						—						(368)
Balance as of January 30, 2022						4						$	—					410						$	—					$	23,083					$	—					$	(115)					$	22,968

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BROADCOM INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Overview, Basis of Presentation and Significant Accounting Policies

Overview

Broadcom Inc. (“Broadcom”), a Delaware corporation, is a global technology leader that designs, develops and supplies a broad range of semiconductor and infrastructure software solutions. We develop semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products. We have a history of innovation in the semiconductor industry and offer thousands of products that are used in end products such as enterprise and data center networking, home connectivity, set-top boxes, broadband access, telecommunication equipment, smartphones and base stations, data center servers and storage systems, factory automation, power generation and alternative energy systems, and electronic displays. Our infrastructure software solutions enable customers to plan, develop, automate, manage and secure applications across mainframe, distributed, mobile and cloud platforms. Our portfolio of infrastructure and security software is designed to modernize, optimize, and secure the most complex hybrid environments, enabling scalability, agility, automation, insights, resiliency and security. We also offer mission critical fibre channel storage area networking (“FC SAN”) products and related software in the form of modules, switches and subsystems incorporating multiple semiconductor products. Unless stated otherwise or the context otherwise requires, references to “Broadcom,” “we,” “our,” and “us” mean Broadcom and its consolidated subsidiaries. We have two reportable segments: semiconductor solutions and infrastructure software.

Basis of Presentation

We operate on a 52- or 53-week fiscal year ending on the Sunday closest to October 31 in a 52-week year and the first Sunday in November in a 53-week year. Our fiscal year ending October 29, 2023 (“fiscal year 2023”) is a 52-week fiscal year. The first quarter of our fiscal year 2023 ended on January 29, 2023, the second quarter ends on April 30, 2023 and the third quarter ends on July 30, 2023. Our fiscal year ended October 30, 2022 (“fiscal year 2022”) was also a 52-week fiscal year.

The accompanying condensed consolidated financial statements include the accounts of Broadcom and its subsidiaries, and have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information. The financial information included herein is unaudited, and reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair statement of the results for the periods presented. The October 30, 2022 condensed consolidated balance sheet data were derived from Broadcom’s audited consolidated financial statements included in its Annual Report on Form 10-K for fiscal year 2022 as filed with the Securities and Exchange Commission. All intercompany balances and transactions have been eliminated in consolidation. The operating results for the fiscal quarter ended January 29, 2023 are not necessarily indicative of the results that may be expected for fiscal year 2023, or for any other future period.

Significant Accounting Policies

Use of estimates. The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The inputs into certain of these estimates and assumptions include the consideration of the economic impact of the COVID-19 pandemic, and many of these estimates could require increased judgment and carry a higher degree of variability and volatility. Actual results could differ materially from these estimates, and such differences could affect the results of operations reported in future periods.

2. Revenue from Contracts with Customers

We account for a contract with a customer when both parties have approved the contract and are committed to perform their respective obligations, each party’s rights can be identified, payment terms can be identified, the contract has commercial substance, and it is probable we will collect substantially all of the consideration we are entitled. Revenue is recognized when, or as, performance obligations are satisfied by transferring control of a promised product or service to a customer.

Disaggregation

We have considered (1) information that is regularly reviewed by our Chief Executive Officer, who has been identified as the chief operating decision maker (the “CODM”) as defined by the authoritative guidance on segment reporting, in evaluating financial performance and (2) disclosures presented outside of our financial statements in our earnings releases and used in investor presentations to disaggregate revenues. The principal category we use to disaggregate revenues is the nature of our products and subscriptions and services, as presented in our condensed consolidated statements of operations. In addition, revenues by reportable segment are presented in Note 10. “Segment Information.”

The following tables present revenue disaggregated by type of revenue and by region for the periods presented:

						Fiscal Quarter Ended January 29, 2023
						Americas						Asia Pacific						Europe, the Middle East and Africa						Total
						(In millions)
Products						$	609					$	5,937					$	536					$	7,082
Subscriptions and services (a)						1,230						200						403						1,833
Total						$	1,839					$	6,137					$	939					$	8,915

						Fiscal Quarter Ended January 30, 2022
						Americas						Asia Pacific						Europe, the Middle East and Africa						Total
						(In millions)
Products						$	548					$	4,984					$	521					$	6,053
Subscriptions and services (a)						1,109						128						416						1,653
Total						$	1,657					$	5,112					$	937					$	7,706

---

(a) Subscriptions and services predominantly include software licenses with termination for convenience clauses.

Although we recognize revenue for the majority of our products when title and control transfer in Penang, Malaysia, we disclose net revenue by region based primarily on the geographic shipment location or delivery location specified by our distributors, original equipment manufacturer customers, contract manufacturers, channel partners, or software customers.

Contract Balances

						January 29, 2023						October 30, 2022
			(In millions)
Contract Assets						$	169					$	128
Contract Liabilities						$	3,494					$	3,341

Changes in our contract assets and contract liabilities primarily result from the timing difference between our performance and the customer’s payment. We fulfill our obligations under a contract with a customer by transferring products and services in exchange for consideration from the customer. We recognize a contract asset when we transfer products or services to a customer and the right to consideration is conditional on something other than the passage of time. Accounts receivable are recorded when the customer has been billed or the right to consideration is unconditional. We recognize contract liabilities when we have received consideration or an amount of consideration is due from the customer and we have a future obligation to transfer products or services. Contract liabilities include amounts billed or collected and advanced payments on contracts or arrangements, which may include termination for convenience provisions. The amount of revenue recognized during the fiscal quarter ended January 29, 2023 that was included in the contract liabilities balance as of October 30, 2022 was $1,435 million. The amount of revenue recognized during the fiscal quarter ended January 30, 2022 that was included in the contract liabilities balance as of October 31, 2021 was $1,216 million.

Remaining Performance Obligations

Revenue allocated to remaining performance obligations represents the transaction price allocated to unsatisfied or partially unsatisfied performance obligations. Remaining performance obligations include unearned revenue and amounts that will be invoiced and recognized as revenue in future periods, but do not include contracts for software, subscriptions or

services where the customer is not committed. The customer is not considered committed when termination for convenience without payment of a substantive penalty exists, either contractually or through customary business practice. The majority of our customer software contracts include termination for convenience clauses without a substantive penalty and are not considered committed. Additionally, as a practical expedient, we have not included contracts that have an original duration of one year or less, nor have we included contracts with sales-based or usage-based royalties promised in exchange for a license of intellectual property (“IP”).

Certain multi-year customer contracts primarily in our semiconductor solutions segment contain firmly committed amounts and the remaining performance obligations under these contracts as of January 29, 2023 were approximately $22.8 billion. We expect approximately 29% of this amount to be recognized as revenue over the next 12 months. Although the majority of our software contracts are not deemed to be committed, our customers generally do not exercise their termination for convenience rights. In addition, the majority of our contracts for products, subscriptions and services have a duration of one year or less. Accordingly, our remaining performance obligations disclosed above are not indicative of revenue for future periods.

3. Pending Acquisition of VMware, Inc.

On May 26, 2022, we entered into an Agreement and Plan of Merger (the “VMware Merger Agreement”) to acquire all of the outstanding shares of VMware, Inc. (“VMware”) in a cash-and-stock transaction (the “VMware Merger”) that values VMware at approximately $61 billion based on the closing price of Broadcom common stock on May 25, 2022. We will also assume VMware’s closing date outstanding debt, net of expected cash.

Under the terms of the VMware Merger Agreement, each share of VMware common stock issued and outstanding immediately prior to the effective time of the VMware Merger will be indirectly converted into the right to receive, at the election of the holder of such share of VMware common stock, either $142.50 in cash, without interest, or 0.2520 shares of Broadcom common stock. The stockholder election will be subject to proration, such that the total number of shares of VMware common stock entitled to receive cash and the total number of shares of VMware common stock entitled to receive Broadcom common stock, will, in each case, be equal to 50% of the aggregate number of shares of VMware common stock issued and outstanding immediately prior to the effective time of the VMware Merger.

We will assume all outstanding VMware restricted stock unit (“RSU”) awards and performance stock unit awards held by continuing employees. The assumed awards will be converted into RSU awards for shares of Broadcom common stock. All outstanding in-the-money VMware stock options and RSU awards held by non-employee directors will be accelerated and converted into the right to receive cash and shares of Broadcom common stock, in equal parts.

Effective upon the effective time of the VMware Merger, one member of the VMware Board of Directors, to be mutually agreed by us and VMware, will be added to our Board of Directors.

In connection with the execution of the VMware Merger Agreement, we entered into a commitment letter on May 26, 2022, with certain financial institutions that committed to provide, subject to the terms and conditions of the commitment letter, a senior unsecured bridge facility in an aggregate principal amount of $32 billion.

The VMware Merger, which is expected to be completed in our fiscal year 2023, is subject to satisfaction or waiver of customary closing conditions, including the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvement Act of 1976 and clearance under the antitrust laws of the European Union and certain other jurisdictions. On October 3, 2022, we registered approximately 59 million shares of our common stock. On November 4, 2022, VMware stockholders adopted the VMware Merger Agreement. We and VMware each have termination rights under the VMware Merger Agreement and, under specified circumstances, upon termination of the agreement, we and VMware would be required to pay the other a termination fee of $1.5 billion.

4. Supplemental Financial Information

Cash Equivalents

Cash equivalents included $3,520 million and $3,915 million of time deposits and $2,184 million and $2,365 million of money-market funds as of January 29, 2023 and October 30, 2022, respectively. For time deposits, carrying value approximates fair value due to the short-term nature of the instruments. The fair value of money-market funds, which was consistent with their carrying value, was determined using unadjusted prices in active, accessible markets for identical assets, and as such, they were classified as Level 1 assets in the fair value hierarchy.

Accounts Receivable Factoring

We sell certain of our trade accounts receivable on a non-recourse basis to third-party financial institutions pursuant to factoring arrangements. We account for these transactions as sales of receivables and present cash proceeds as cash provided by operating activities in the condensed consolidated statements of cash flows. Total trade accounts receivable sold under the

factoring arrangements were $1,025 million and $1,200 million during the fiscal quarters ended January 29, 2023 and January 30, 2022, respectively. Factoring fees for the sales of receivables were recorded in other income (expense), net and were not material for any of the periods presented.

Inventory

						January 29, 2023						October 30, 2022
						(In millions)
Finished goods						$	702					$	780
Work-in-process						986						966
Raw materials						211						179
Total inventory						$	1,899					$	1,925

Other Current Assets

						January 29, 2023						October 30, 2022
						(In millions)
Prepaid expenses						$	609					$	864
Other						447						341
Total other current assets						$	1,056					$	1,205

Other Current Liabilities

						January 29, 2023						October 30, 2022
						(In millions)
Contract liabilities						$	3,109					$	2,931
Tax liabilities						915						680
Interest payable						406						393
Other						479						408
Total other current liabilities						$	4,909					$	4,412

Other Long-Term Liabilities

						January 29, 2023						October 30, 2022
						(In millions)
Unrecognized tax benefits						$	2,866					$	3,229
Other						1,150						1,184
Total other long-term liabilities						$	4,016					$	4,413

Supplemental Cash Flow Information

						Fiscal Quarter Ended
						January 29, 2023						January 30, 2022
						(In millions)
Cash paid for interest						$	361					$	240
Cash paid for income taxes						$	273					$	186

During the fiscal quarter ended January 29, 2023 and fiscal year 2022, we entered into treasury rate lock contracts that mature in approximately one year to hedge variability of cash flows due to changes in the benchmark interest rate of anticipated future debt issuances. These treasury rate locks are designated and accounted for as cash flow hedging instruments. As of January 29, 2023 and October 30, 2022, the total notional amounts of these contracts were $5.5 billion and $1.3 billion, respectively. As of January 29, 2023, the fair value of $114 million was recorded in other current liabilities. As of October 30, 2022, the fair value of $47 million was recorded in other long-term assets. The change in fair value was recorded as a component of other comprehensive income (loss), net of tax, in our condensed consolidated statements of comprehensive income.

5. Intangible Assets

						Gross Carrying Amount						Accumulated Amortization						Net Book Value
						(In millions)
As of January 29, 2023:
Purchased technology						$	19,450					$	(15,956)					$	3,494
Customer contracts and related relationships						7,066						(4,841)						2,225
Order backlog						484						(407)						77
Trade names						700						(389)						311
Other						174						(85)						89
Intangible assets subject to amortization						27,874						(21,678)						6,196
In-process research and development						29						—						29
Total						$	27,903					$	(21,678)					$	6,225
As of October 30, 2022:
Purchased technology						$	19,450					$	(15,422)					$	4,028
Customer contracts and related relationships						7,066						(4,535)						2,531
Order backlog						484						(382)						102
Trade names						700						(372)						328
Other						174						(81)						93
Intangible assets subject to amortization						27,874						(20,792)						7,082
In-process research and development						29						—						29
Total						$	27,903					$	(20,792)					$	7,111

Based on the amount of intangible assets subject to amortization as of January 29, 2023, the expected amortization expense was as follows:

Fiscal Year:						Expected Amortization Expense
						(In millions)
2023 (remainder)						$	2,369
2024						2,388
2025						681
2026						344
2027						216
Thereafter						198
Total						$	6,196

The weighted-average remaining amortization periods by intangible asset category were as follows:

Amortizable intangible assets:						January 29, 2023
						(In years)
Purchased technology						3
Customer contracts and related relationships						2
Order backlog						1
Trade names						8
Other						8

6. Net Income Per Share

Basic net income per share is computed by dividing net income attributable to common stock by the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share is computed by dividing net income attributable to common stock by the weighted-average number of shares of common stock and potentially dilutive shares of common stock outstanding during the period.

Diluted shares outstanding include the dilutive effect of unvested RSUs and employee stock purchase plan rights under the Broadcom Inc. Employee Stock Purchase Plan, as amended (“ESPP”), (collectively referred to as “equity awards”), as well as 8.00% Mandatory Convertible Preferred Stock, Series A, $0.001 par value per share (“Mandatory Convertible Preferred Stock”), which was all converted into shares of our common stock before the end of fiscal year 2022. Potentially dilutive shares whose effect would have been antidilutive are excluded from the computation of diluted net income per share.

The dilutive effect of equity awards is calculated based on the average stock price for each fiscal period, using the treasury stock method. Under the treasury stock method, the amount the employee must pay for purchasing shares under the ESPP and the amount of compensation cost for future service that we have not yet recognized are collectively assumed to be used to repurchase shares. The dilutive effect of Mandatory Convertible Preferred Stock is calculated using the if-converted method. The if-converted method assumes that these securities were converted at the beginning of the reporting period to the extent that the effect is dilutive.

For the fiscal quarter ended January 30, 2022, diluted net income per share excluded the potentially dilutive effect of 12 million shares of common stock issuable upon the conversion of Mandatory Convertible Preferred Stock as their effect was antidilutive.

The following is a reconciliation of the numerators and denominators of the basic and diluted net income per share computations for the periods presented:

						Fiscal Quarter Ended
						January 29, 2023						January 30, 2022
						(In millions, except per share data)
Numerator:
Net income						$	3,774					$	2,472
Dividends on preferred stock						—						(74)
Net income attributable to common stock						$	3,774					$	2,398
Denominator:
Weighted-average shares outstanding - basic						418						412
Dilutive effect of equity awards						11						17
Weighted-average shares outstanding - diluted						429						429

Net income per share attributable to common stock:
Basic						$	9.03					$	5.82
Diluted						$	8.80					$	5.59

7. Borrowings

						Effective Interest Rate						January 29, 2023						October 30, 2022
						(In millions, except percentages)
April 2022 Senior Notes - fixed rate
4.000% notes due April 2029						4.17		%				$	750					$	750
4.150% notes due April 2032						4.30		%				1,200						1,200
4.926% notes due May 2037						5.33		%				2,500						2,500
												4,450						4,450
September 2021 Senior Notes - fixed rate
3.137% notes due November 2035						4.23		%				3,250						3,250
3.187% notes due November 2036						4.79		%				2,750						2,750
												6,000						6,000
March 2021 Senior Notes - fixed rate
3.419% notes due April 2033						4.66		%				2,250						2,250
3.469% notes due April 2034						4.63		%				3,250						3,250
												5,500						5,500
January 2021 Senior Notes - fixed rate
1.950% notes due February 2028						2.10		%				750						750
2.450% notes due February 2031						2.56		%				2,750						2,750
2.600% notes due February 2033						2.70		%				1,750						1,750
3.500% notes due February 2041						3.60		%				3,000						3,000
3.750% notes due February 2051						3.84		%				1,750						1,750
												10,000						10,000
June 2020 Senior Notes - fixed rate
3.459% notes due September 2026						4.19		%				752						752
4.110% notes due September 2028						5.02		%				1,118						1,118
												1,870						1,870
May 2020 Senior Notes - fixed rate
2.250% notes due November 2023						2.40		%				105						105
3.150% notes due November 2025						3.29		%				900						900
4.150% notes due November 2030						4.27		%				1,856						1,856
4.300% notes due November 2032						4.39		%				2,000						2,000
												4,861						4,861
April 2020 Senior Notes - fixed rate
5.000% notes due April 2030						5.18		%				606						606
April 2019 Senior Notes - fixed rate
3.625% notes due October 2024						3.98		%				622						622
4.750% notes due April 2029						4.95		%				1,655						1,655
												2,277						2,277
2017 Senior Notes - fixed rate
2.650% notes due January 2023						2.78		%				—						260
3.625% notes due January 2024						3.74		%				829						829
3.125% notes due January 2025						3.23		%				495						495
3.875% notes due January 2027						4.02		%				2,922						2,922

						Effective Interest Rate						January 29, 2023						October 30, 2022
						(In millions, except percentages)
3.500% notes due January 2028						3.60		%				777						777
												5,023						5,283
Assumed CA Senior Notes - fixed rate
4.500% notes due August 2023						4.10		%				143						143
4.700% notes due March 2027						5.15		%				215						215
												358						358
Other senior notes - fixed rate
3.500% notes due August 2024						3.55		%				7						7
4.500% notes due August 2034						4.55		%				6						6
												13						13
Total principal amount outstanding												$	40,958					$	41,218
Current portion of principal amount outstanding												$	1,077					$	403
Short-term finance lease liabilities												38						37
Total current portion of long-term debt												$	1,115					$	440
Non-current portion of principal amount outstanding												$	39,881					$	40,815
Long-term finance lease liabilities												17						22
Unamortized discount and issuance costs												(1,731)						(1,762)
Total long-term debt												$	38,167					$	39,075

Credit Agreement

In January 2021, we entered into a credit agreement (the “Credit Agreement”), which provides for a five-year $7.5 billion unsecured revolving credit facility, of which $500 million is available for the issuance of multi-currency letters of credit. The issuance of letters of credit and certain other instruments would reduce the aggregate amount otherwise available under our revolving credit facility for revolving loans. Subject to the terms of the Credit Agreement, we are permitted to borrow, repay and reborrow revolving loans at any time prior to the earlier of (a) January 19, 2026 and (b) the date of termination in whole of the revolving lenders’ commitments under the Credit Agreement. We had no borrowings outstanding under our revolving credit facility at either January 29, 2023 or October 30, 2022.

Commercial Paper

In February 2019, we established a commercial paper program pursuant to which we may issue unsecured commercial paper notes (“Commercial Paper”) in principal amount of up to $2 billion outstanding at any time with maturities of up to 397 days from the date of issue. Commercial Paper is sold under customary terms in the commercial paper market and may be issued at a discount from par or, alternatively, may be sold at par and bear interest at rates dictated by market conditions at the time of their issuance. The discount associated with the Commercial Paper is amortized to interest expense over its term. Outstanding Commercial Paper reduces the amount that would otherwise be available to borrow for general corporate purposes under our revolving credit facility. We had no Commercial Paper outstanding at either January 29, 2023 or October 30, 2022.

Fair Value of Debt

As of January 29, 2023, the estimated aggregate fair value of debt was $35,565 million. The fair value of our senior notes was determined using quoted prices from less active markets. All of our debt obligations are categorized as Level 2 instruments.

Future Principal Payments of Debt

The future scheduled principal payments of debt as of January 29, 2023 were as follows:

Fiscal Year:						Future Scheduled Principal Payments
						(In millions)
2023 (remainder)						$	143
2024						1,563
2025						495
2026						1,652
2027						3,137
Thereafter						33,968
Total						$	40,958

As of January 29, 2023 and October 30, 2022, we were in compliance with all debt covenants.

8. Stockholders’ Equity

Cash Dividends Declared and Paid

						Fiscal Quarter Ended
						January 29, 2023						January 30, 2022
						(In millions, except per share data)
Dividends per share to common stockholders						$	4.60					$	4.10
Dividends to common stockholders						$	1,926					$	1,689
Dividends per share to preferred stockholders						$	—					$	20.00
Dividends to preferred stockholders						$	—					$	75

On September 30, 2019, we issued approximately 4 million shares of Mandatory Convertible Preferred Stock, which were all converted into shares of our common stock before the end of fiscal year 2022.

Stock Repurchase Programs

In December 2021, 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, 2022, which was subsequently extended to December 31, 2023. In May 2022, our Board of Directors authorized another stock repurchase program to repurchase up to an additional $10 billion of our common stock from time to time through December 31, 2023.

We repurchased and retired approximately 2 million and 4 million shares of our common stock for $1,188 million and $2,724 million during the fiscal quarters ended January 29, 2023 and January 30, 2022, respectively, under these stock repurchase programs.

Repurchases under our stock repurchase programs may be effected through a variety of methods, including open market or privately negotiated purchases. The timing and amount of shares repurchased will depend on the stock price, business and market conditions, corporate and regulatory requirements, alternative investment opportunities, acquisition opportunities, and other factors. We are not obligated to repurchase any specific amount of shares of common stock, and the stock repurchase programs may be suspended or terminated at any time.

Stock-Based Compensation Expense

						Fiscal Quarter Ended
						January 29, 2023						January 30, 2022
						(In millions)
Cost of products sold						$	16					$	18
Cost of subscriptions and services						21						18
Research and development						267						268
Selling, general and administrative						87						83
Total stock-based compensation expense						$	391					$	387

As of January 29, 2023, the total unrecognized compensation cost related to unvested stock-based awards was $2,763 million, which is expected to be recognized over the remaining weighted-average service period of 2.8 years.

Equity Incentive Award Plans

A summary of time- and market-based RSU activity is as follows:

						Number of RSUs Outstanding						Weighted-Average Grant Date Fair Value Per Share
						(In millions, except per share data)
Balance as of October 30, 2022						18						$	238.49
Granted						2						$	240.98
Vested						(2)						$	240.75
Forfeited						—			*			$	253.90
Balance as of January 29, 2023						18						$	238.16

---

• Represents fewer than 1 million shares.

The aggregate fair value of time- and market-based RSUs that vested during the fiscal quarter ended January 29, 2023 was $961 million, which represented the market value of our common stock on the date that the RSUs vested. The number of RSUs vested included shares of common stock that we withheld for settlement of employees’ tax obligations due upon the vesting of RSUs.

9. Income Taxes

The provision for income taxes was $66 million and $215 million for the fiscal quarters ended January 29, 2023 and January 30, 2022, respectively. The decrease was primarily due to the recognition of uncertain tax benefits as a result of lapses of statutes of limitations, partially offset by higher income before income taxes during the fiscal quarter ended January 29, 2023, compared to the prior year fiscal period.

As of January 29, 2023, we had $5,338 million of gross unrecognized tax benefits and accrued interest and penalties. It is possible that our existing unrecognized tax benefits may change up to $197 million within the next 12 months as a result of lapses of statutes of limitations for certain audit periods, anticipated closures of audit examinations and changes in balances related to tax positions to be taken during the current fiscal year.

10. Segment Information

Reportable Segments

We have two reportable segments: semiconductor solutions and infrastructure software. Each segment has separate financial information that is utilized on a regular basis by the CODM in determining how to allocate resources and evaluate performance. The reportable segments are determined based on several factors including, but not limited to, customer base, homogeneity of products, technology, delivery channels and similar economic characteristics.

Semiconductor solutions. We provide semiconductor solutions for managing the movement of data in data center, service provider, enterprise and embedded networking applications. We provide a broad variety of radio frequency semiconductor devices, wireless connectivity solutions, custom touch controllers, and inductive charging solutions for mobile applications. We also provide semiconductor solutions for enabling the set-top box and broadband access markets and for enabling secure movement of digital data to and from host machines, such as servers, personal computers and storage systems, to the underlying storage devices, such as hard disk drives and solid state drives. We also provide a broad variety of products for the general industrial and automotive markets. Our semiconductor solutions segment also includes our IP licensing.

Infrastructure software. We provide a portfolio of software solutions that enables customers to plan, develop, automate, manage and secure applications across mainframe, distributed, mobile and cloud platforms. Our portfolio of infrastructure and security software is designed to modernize, optimize, and secure the most complex hybrid environments, enabling scalability, agility, automation, insights, resiliency and security. We also offer mission critical FC SAN products and related software.

Our CODM assesses the performance of each segment and allocates resources to each segment based on net revenue and operating results and does not evaluate each segment using discrete asset information. Operating results by segment include items that are directly attributable to each segment and also include shared expenses such as marketing, general and administrative activities, facilities and information technology (“IT”) expenses. Shared expenses are primarily allocated based on revenue and headcount.

Unallocated Expenses

Unallocated expenses include amortization of acquisition-related intangible assets, stock-based compensation expense, restructuring, impairment and disposal charges, acquisition-related costs, and other costs, which are not used in evaluating the results of, or in allocating resources to, our segments. Acquisition-related costs include transaction costs and any costs directly related to the acquisition and integration of acquired businesses.

Depreciation expense directly attributable to each reportable segment is included in the operating results of each segment. However, the CODM does not evaluate depreciation expense by operating segment and, therefore, it is not separately presented. There was no inter-segment revenue for any of the periods presented. The accounting policies of the segments are the same as those described in the “Summary of Significant Accounting Policies” included in the Annual Report on Form 10-K for fiscal year 2022.

						Fiscal Quarter Ended
						January 29, 2023						January 30, 2022
						(In millions)
Net revenue:
Semiconductor solutions						$	7,107					$	5,873
Infrastructure software						1,808						1,833
Total net revenue						$	8,915					$	7,706
Operating income:
Semiconductor solutions						$	4,123					$	3,349
Infrastructure software						1,307						1,307
Unallocated expenses						(1,327)						(1,548)
Total operating income						$	4,103					$	3,108

11. Commitments and Contingencies

Commitments

The following table summarizes contractual obligations and commitments as of January 29, 2023:

Fiscal Year:						Purchase Commitments						Other Contractual Commitments
						(In millions)
2023 (remainder)						$	154					$	232
2024						197						266
2025						112						158
2026						11						163
2027						7						112
Thereafter						7						447
Total						$	488					$	1,378

Purchase Commitments. Represent unconditional purchase obligations to purchase goods or services, primarily inventory, that are enforceable and legally binding on us and specify all significant terms, including fixed or minimum quantities to be purchased, price provisions, and the approximate timing of the transaction. Purchase obligations exclude agreements that are cancelable without penalty and unconditional purchase obligations with a remaining term of one year or less.

Other Contractual Commitments. Represent amounts payable pursuant to agreements related to IT, human resources, and other service agreements.

Due to the inherent uncertainty with respect to the timing of future cash outflows associated with our unrecognized tax benefits at January 29, 2023, we are unable to reliably estimate the timing of cash settlement with the respective taxing authorities. Therefore, $2,866 million of unrecognized tax benefits and accrued interest and penalties as of January 29, 2023 have been excluded from the table above.

Contingencies

From time to time, we are involved in litigation that we believe is of the type common to companies engaged in our lines of business, including commercial disputes, employment issues, tax disputes and disputes involving claims by third parties that our activities infringe their patent, copyright, trademark or other IP rights, as well as regulatory investigations or inquiries. Legal proceedings and regulatory investigations or inquiries are often complex, may require the expenditure of significant funds and other resources, and the outcome of such proceedings is inherently uncertain, with material adverse outcomes possible. IP property claims generally involve the demand by a third-party that we cease the manufacture, use or sale of the allegedly infringing products, processes or technologies and/or pay substantial damages or royalties for past, present and future use of the allegedly infringing IP. Claims that our products or processes infringe or misappropriate any third-party IP rights (including claims arising through our contractual indemnification of our customers) often involve highly complex, technical issues, the outcome of which is inherently uncertain. Moreover, from time to time, we pursue litigation to assert our IP rights. Regardless of the merit or resolution of any such litigation, complex IP litigation is generally costly and diverts the efforts and attention of our management and technical personnel.

Lawsuits Relating to California Institute of Technology

California Institute of Technology (“Caltech“) filed a complaint against Broadcom and Apple Inc. on May 26, 2016 in the United States District Court for the Central District of California (the “U.S. Central District Court”), and an amended complaint adding Cypress Semiconductor Corporation as a defendant on August 15, 2016. The amended complaint alleged that chips that support certain error correction codes as specified in IEEE Standards 802.11n and 802.11ac willfully infringed four patents related to error correction coding: U.S. Patent Nos. 7,116,710; 7,421,032; 7,916,781; and 8,284,833 (“’833 patent”). Prior to trial, Caltech dismissed its claims against Cypress and withdrew its infringement allegations as to ‘833 patent. The complaint sought a preliminary and permanent injunction, damages, pre- and post-judgment interest, as well as attorneys’ fees, costs, and expenses. The trial was held in January 2020, and on January 29, 2020, the jury issued its verdict finding infringement and awarding Caltech past damages of $270.2 million from Broadcom and $837.8 million from Apple, for which Apple is seeking indemnification from Broadcom. On August 3, 2020, the U.S. Central District Court issued its judgment, awarding Caltech past damages in the amounts awarded by the jury, as well as pre- and post-judgment interest. Additionally, the U.S. Central District Court awarded Caltech an unspecified amount of ongoing royalties to be determined after the anticipated appeals process is resolved. Neither the jury nor the U.S. Central District Court found willful infringement, which if it had, could have resulted in

enhanced damages up to three times the amount awarded. Broadcom and Apple appealed to the United States Court of Appeals for the Federal Circuit (the “Federal Circuit Court”). In February 2022. the Federal Circuit Court affirmed infringement of two patents, both of which expired in August 2020, but it did not address all issues and ordered a new trial on damages and on the infringement of the 7,916,781 patent, which also expired in August 2020. In May 2022, the Federal Circuit Court denied the petition for rehearing filed by Broadcom and Apple, and remanded the case to the U.S. Central District Court. Subsequently, Caltech withdrew its infringement allegations as to the 7,916,781 patent.

We believe that the evidence and the law do not support the U.S. Central District Court’s findings of infringement. We cannot reasonably estimate the ultimate outcome as the Federal Circuit Court vacated the above damages, and a number of factors (including a retrial at the lower court and further appeals) could significantly change the assessment of damages. As a result, we have not recorded a reserve with respect to this litigation, in accordance with the applicable accounting standards.

Other Matters

In addition to the matters discussed above, we are currently engaged in a number of legal actions in the ordinary course of our business.

Contingency Assessment

We do not believe, based on currently available facts and circumstances, that the final outcome of any pending legal proceedings or ongoing regulatory investigations, taken individually or as a whole, will have a material adverse effect on our condensed consolidated financial statements. However, lawsuits may involve complex questions of fact and law and may require the expenditure of significant funds and other resources to defend. The results of litigation or regulatory investigations are inherently uncertain, and material adverse outcomes are possible. From time to time, we may enter into confidential discussions regarding the potential settlement of such lawsuits. Any settlement of pending litigation could require us to incur substantial costs and other ongoing expenses, such as future royalty payments in the case of an IP dispute.

During the periods presented, no material amounts have been accrued or disclosed in the accompanying condensed consolidated financial statements with respect to loss contingencies associated with any other legal proceedings or regulatory investigations, as potential losses for such matters are not considered probable and ranges of losses are not reasonably estimable. These matters are subject to many uncertainties and the ultimate outcomes are not predictable. There can be no assurances that the actual amounts required to satisfy any liabilities arising from the matters described above will not have a material adverse effect on our condensed consolidated financial statements.

Other Indemnifications

As is customary in our industry and as provided for in local law in the U.S. and other jurisdictions, many of our standard contracts provide remedies to our customers and others with whom we enter into contracts, such as defense, settlement, or payment of judgment for IP claims related to the use of our products. From time to time, we indemnify customers, as well as our suppliers, contractors, lessors, lessees, companies that purchase our businesses or assets and others with whom we enter into contracts, against combinations of loss, expense, or liability arising from various triggering events related to the sale and the use of our products, the use of their goods and services, the use of facilities and state of our owned facilities, the state of the assets and businesses that we sell and other matters covered by such contracts, usually up to a specified maximum amount. In addition, from time to time we also provide protection to these parties against claims related to undiscovered liabilities, additional product liabilities or environmental obligations. In our experience, claims made under such indemnifications are rare and the associated estimated fair value of the liability is not material.

12. Restructuring, Impairment and Disposal Charges

From time to time, we initiate cost reduction activities to integrate acquired businesses, to align our workforce with strategic business activities, or to improve efficiencies in our operations. We recognized charges of $8 million and $19 million during the fiscal quarters ended January 29, 2023 and January 30, 2022, respectively. These charges were primarily recognized in operating expenses.

The following table summarizes the significant activities within, and components of, the restructuring liabilities during the fiscal quarter ended January 29, 2023:

						Employee Termination Costs						Other Exit Costs						Total
						(In millions)
Balance as of October 30, 2022						$	4					$	2					$	6
Restructuring charges						6						—						6
Utilization						(7)						—						(7)
Balance as of January 29, 2023						$	3					$	2					$	5

Restructuring, impairment and disposal charges for the fiscal quarter ended January 29, 2023 included $2 million for the write-down of certain lease-related right-of-use assets and other lease-related charges.

13. Subsequent Events

Cash Dividends Declared

On March 1, 2023, our Board of Directors declared a quarterly cash dividend of $4.60 per share on our common stock, payable on March 31, 2023 to stockholders of record on March 22, 2023.