Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of the financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q (“Form 10-Q”) and the audited consolidated financial statements and notes thereto and management’s discussion and analysis of financial condition and results of operations for the fiscal year ended October 29, 2023 (“fiscal year 2023”) included in our Annual Report on Form 10-K for fiscal year 2023 (“2023 Annual Report on Form 10-K”). References to “Broadcom,” “we,” “our,” and “us” are to Broadcom Inc. and its consolidated subsidiaries, unless otherwise specified or the context otherwise requires. This Form 10-Q may contain predictions, estimates and other forward-looking statements that involve a number of risks and uncertainties, which are made under the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements may include projections of financial information; statements about historical results that may suggest trends for our business; statements of the plans, strategies and objectives of management for future operations; and statements of expectation or belief regarding future events (including any acquisitions we may make), technology developments, emerging markets, our products, product sales, expenses, liquidity, cash flow and growth rates, customer concentration and relationships, or enforceability of our intellectual property (“IP”) rights. Such statements are based on current expectations, estimates, forecasts and projections of our industry performance and macroeconomic conditions, based on management’s judgment, beliefs, current trends and market conditions, and involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. We derive most of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results. Accordingly, undue reliance should not be placed on these statements. Important factors that could cause actual results to differ materially from our expectations are disclosed under “Risk Factors” in Part II, Item 1A of this Form 10-Q, and in other documents we file from time to time with the Securities and Exchange Commission (the “SEC”). All of the forward-looking statements in this Form 10-Q are qualified in their entirety by reference to the factors listed above and those discussed under the heading “Risk Factors” below. We undertake no intent or obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as otherwise required by law.

Overview

We are 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, deliver, automate, manage and secure applications across mainframe, distributed, edge, mobile, and private and hybrid cloud platforms. Our portfolio of industry-leading infrastructure and security software is designed to modernize, optimize, and secure the most complex private and hybrid cloud 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.

We have two reportable segments: semiconductor solutions and infrastructure software. Our semiconductor solutions segment includes all of our product lines and IP licensing. Our infrastructure software segment includes our application development and delivery, application networking and security, mainframe, distributed, software-defined edge, private and hybrid cloud and cyber security solutions, and our FC SAN business.

Our fiscal year ending November 3, 2024 (“fiscal year 2024”), is a 53-week fiscal year, with our first fiscal quarter ended February 4, 2024 containing 14 weeks compared to 13 weeks in the prior year fiscal period. The additional week resulted in higher net revenue, gross margin dollars, research and development expense, and selling general and administrative expense in the first fiscal quarter and first three fiscal quarters of fiscal year 2024, compared to the corresponding prior year fiscal periods.

Quarterly Highlights

Highlights during the fiscal quarter ended August 4, 2024 include the following:

• We generated $4,963 million of cash from operations.

• We paid $2,452 million in cash dividends.

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*•*We sold the end-user computing (“EUC”) business to KKR & Co. Inc. for $3.5 billion.

• We issued $5.0 billion of senior unsecured notes (the “July 2024 Senior Notes”) and used the net proceeds, as well as the net proceeds from the sale of the EUC business and cash on hand, to repay the outstanding balance of $9,195 million of our unsecured term A-2 facility.

*•*We completed a ten-for-one forward stock split of our common stock. All share, equity award and per share amounts have been retroactively adjusted to reflect the stock split.

Acquisitions and Divestitures

Acquisition of VMware and Divestiture of EUC

On November 22, 2023, we acquired VMware, Inc. (“VMware”) in a cash-and-stock transaction (the “VMware Merger”). The VMware stockholders received approximately $30,788 million in cash and 544 million shares of Broadcom common stock with a fair value of $53,398 million. In addition, we assumed all outstanding VMware restricted stock unit (“RSU”) awards and performance stock unit awards held by continuing employees. The assumed awards were converted into RSU awards for shares of Broadcom common stock. All outstanding RSU awards held by non-employee directors and in-the-money VMware stock options were accelerated and converted into the right to receive cash and shares of Broadcom common stock, in equal parts.

On July 1, 2024, we sold the EUC business to KKR & Co. Inc. for cash consideration of $3.5 billion, after working capital adjustments.

Acquisition of Seagate’s SoC Operations

On April 23, 2024, we acquired certain assets related to the design, development, and manufacture of System-on-Chip (“SoC”) operations of Seagate Technology Holdings plc for $600 million. We acquired these assets to strengthen our portfolio of SoC products.

Critical Accounting Estimates

The preparation of financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”) requires us 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 financial statements and the reported amounts of revenue and expenses during the reporting period. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. Our actual financial results may differ materially and adversely from our estimates. Our critical accounting estimates are those that affect our historical financial statements materially and involve difficult, subjective or complex judgments by management. Those estimates include revenue recognition, valuation of goodwill and long-lived assets, and income taxes.

There were no significant changes in our critical accounting estimates during the three fiscal quarters ended August 4, 2024 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 2023 Annual Report on Form 10-K.

Results of Operations

Fiscal Quarter and Three Fiscal Quarters Ended August 4, 2024 Compared to Fiscal Quarter and Three Fiscal Quarters Ended July 30, 2023

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

						Fiscal Quarter Ended
						August 4, 2024						July 30, 2023						August 4, 2024						July 30, 2023
						(In millions)												(As a percentage of net revenue)
Statements of Operations Data:
Net revenue:
Products						$	7,439					$	6,917					57		%				78		%
Subscriptions and services						5,633						1,959						43						22
Total net revenue						13,072						8,876						100						100
Cost of revenue:
Cost of products sold						2,434						2,107						19						24
Cost of subscriptions and services						699						165						5						2
Amortization of acquisition-related intangible assets						1,525						439						12						5
Restructuring charges						58						1						—						—
Total cost of revenue						4,716						2,712						36						31
Gross margin						8,356						6,164						64						69
Research and development						2,353						1,358						18						16
Selling, general and administrative						1,100						388						9						4
Amortization of acquisition-related intangible assets						812						350						6						4
Restructuring and other charges						303						212						2						2
Total operating expenses						4,568						2,308						35						26
Operating income						$	3,788					$	3,856					29		%				43		%

						Three Fiscal Quarters Ended
						August 4, 2024						July 30, 2023						August 4, 2024						July 30, 2023
						(In millions)												(As a percentage of net revenue)
Statements of Operations Data:
Net revenue:
Products						$	22,043					$	20,740					59		%				78		%
Subscriptions and services						15,477						5,784						41						22
Total net revenue						37,520						26,524						100						100
Cost of revenue:
Cost of products sold						7,023						6,351						19						24
Cost of subscriptions and services						2,366						472						6						2
Amortization of acquisition-related intangible assets						4,421						1,415						12						5
Restructuring charges						203						3						—						—
Total cost of revenue						14,013						8,241						37						31
Gross margin						23,507						18,283						63						69
Research and development						7,076						3,865						19						15
Selling, general and administrative						3,949						1,174						11						4
Amortization of acquisition-related intangible assets						2,431						1,046						6						4
Restructuring and other charges						1,215						231						3						1
Total operating expenses						14,671						6,316						39						24
Operating income						$	8,836					$	11,967					24		%				45		%

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Net Revenue

A relatively small number of customers account for a significant portion of our net revenue. Direct sales to one customer, which is a distributor, accounted for 26% and 27% of our net revenue for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, and 21% and 20% of our net revenue for the fiscal quarter and three fiscal quarters ended July 30, 2023, respectively.

We believe aggregate sales to our top five end customers, through all channels, accounted for approximately 35% and 40% of our net revenue for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, and approximately 35% for each of the fiscal quarter and three fiscal quarters ended July 30, 2023. 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.

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 AI and wireless products as fluctuations may be magnified by the timing of customer deployments and product launches, and seasonal variations in sales. In addition, the macroeconomic environment remains uncertain and may cause our net revenue to fluctuate significantly and impact our results of operations.

The following tables set forth net revenue by segment for the periods presented:

						Fiscal Quarter Ended																								Three Fiscal Quarters Ended
Net Revenue by Segment						August 4, 2024						July 30, 2023						$ Change						% Change						August 4, 2024						July 30, 2023						$ Change						% Change
						(Dollars in millions)
Semiconductor solutions						$	7,274					$	6,941					$	333					5		%				$	21,866					$	20,856					$	1,010					5		%
Infrastructure software						5,798						1,935						3,863						200		%				15,654						5,668						9,986						176		%
Total net revenue						$	13,072					$	8,876					$	4,196					47		%				$	37,520					$	26,524					$	10,996					41		%

						Fiscal Quarter Ended												Three Fiscal Quarters Ended
Net Revenue by Segment						August 4, 2024						July 30, 2023						August 4, 2024						July 30, 2023
						(As a percentage of net revenue)
Semiconductor solutions						56		%				78		%				58		%				79		%
Infrastructure software						44						22						42						21
Total net revenue						100		%				100		%				100		%				100		%

Net revenue from our semiconductor solutions segment increased in the fiscal quarter and three fiscal quarters ended August 4, 2024 compared to the prior year fiscal periods due to strong product demand for our networking products, primarily AI networking products, partially offset by lower demand for our broadband and server storage products. Net revenue from our infrastructure software segment increased in the fiscal quarter and three fiscal quarters ended August 4, 2024 compared to the prior year fiscal periods primarily due to contributions from VMware.

Gross Margin

Gross margin was $8,356 million for the fiscal quarter ended August 4, 2024 compared to $6,164 million for the fiscal quarter ended July 30, 2023, and $23,507 million for the three fiscal quarters ended August 4, 2024 compared to $18,283 million for the three fiscal quarters ended July 30, 2023. The increases were primarily due to contributions from VMware, partially offset by higher amortization of acquisition-related intangible assets from the VMware Merger.

As a percentage of net revenue, gross margin was 64% and 63% of net revenue for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, and 69% for each of the fiscal quarter and three fiscal quarters ended July 30, 2023. The decreases were primarily due to higher amortization of acquisition-related intangible assets from the VMware Merger. In addition, gross margin contributions from our infrastructure software segment were partially offset by less favorable margin within the semiconductor solutions segment driven by product mix.

Research and Development Expense

Research and development expense increased $995 million, or 73%, and $3,211 million, or 83%, for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, compared to the prior year fiscal periods. The increases were

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primarily due to higher compensation, including higher stock-based compensation, as a result of an increase in headcount from the VMware Merger. The increases in stock-based compensation expense were also due to annual employee equity awards granted at higher grant-date fair values.

Selling, General and Administrative Expense

Selling, general and administrative expense increased $712 million, or 184%, and $2,775 million, or 236%, for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, compared to the prior year fiscal periods. The increases were primarily due to higher compensation, including higher stock-based compensation, as a result of an increase in headcount from the VMware Merger. The increases in stock-based compensation expense were also due to annual employee equity awards granted at higher grant-date fair values.

Amortization of Acquisition-Related Intangible Assets

Amortization of acquisition-related intangible assets recognized in operating expenses increased $462 million, or 132%, and $1,385 million, or 132%, for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, compared to the prior year fiscal periods primarily due to higher amortization of customer-related intangible assets from the VMware Merger.

Restructuring and Other Charges

Restructuring and other charges recognized in operating expenses were $303 million and $1,215 million for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, primarily due to employee termination costs associated with the VMware Merger. We expect to incur additional restructuring and other charges in future periods as a result of the VMware Merger. Restructuring and other charges recognized in operating expenses were $212 million and $231 million for the fiscal quarter and three fiscal quarters ended July 30, 2023, respectively, primarily due to non-recurring charges related to IP litigation.

Stock-Based Compensation Expense

Total stock-based compensation expense was $1,381 million and $4,356 million for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, and $629 million and $1,533 million for the fiscal quarter and three fiscal quarters ended July 30, 2023, respectively. The increases were primarily due to equity awards assumed and granted in connection with the VMware Merger and annual employee equity awards granted at higher grant-date fair values.

The following table sets forth the total unrecognized compensation cost related to unvested stock-based awards outstanding and expected to vest as of August 4, 2024. The remaining weighted-average service period was 3.2 years.

Fiscal Year:						Unrecognized Compensation Cost, Net of Expected Forfeitures
						(In millions)
2024 (remainder)						$	1,335
2025						4,574
2026						3,709
2027						2,719
2028						563
Total						$	12,900

Segment Operating Results

						Fiscal Quarter Ended																								Three Fiscal Quarters Ended
Operating Income by Segment						August 4, 2024						July 30, 2023						$ Change						% Change						August 4, 2024						July 30, 2023						$ Change						% Change
						(Dollars in millions)
Semiconductor solutions						$	4,042					$	4,092					$	(50)					(1)		%				$	12,136					$	12,215					$	(79)					(1)		%
Infrastructure software						3,906						1,444						2,462						170		%				9,789						4,163						5,626						135		%
Unallocated expenses						(4,160)						(1,680)						(2,480)						148		%				(13,089)						(4,411)						(8,678)						197		%
Total operating income						$	3,788					$	3,856					$	(68)					(2)		%				$	8,836					$	11,967					$	(3,131)					(26)		%

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Operating income from our semiconductor solutions segment decreased for the fiscal quarter and three fiscal quarters ended August 4, 2024 compared to the prior year fiscal periods primarily due to higher variable compensation expenses and lower gross margins driven by product mix, partially offset by higher revenue from networking products, primarily AI networking products. Higher operating income from our infrastructure software segment in the fiscal quarter and three fiscal quarters ended August 4, 2024 compared to the prior year fiscal periods was primarily due to contributions from VMware.

Unallocated expenses include amortization of acquisition-related intangible assets; stock-based compensation expense; restructuring and other charges; acquisition-related costs; and other costs that are not used in evaluating the results of, or in allocating resources to, our segments. Unallocated expenses increased 148% and 197% for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, compared to the prior year fiscal periods primarily due to higher amortization of acquisition-related intangible assets, stock-based compensation expense and restructuring and other charges. These increases were primarily due to the VMware Merger. The increase in stock-based compensation expense was also due to annual employee equity awards granted at higher grant-date fair values.

Non-Operating Income and Expenses

Interest expense. Interest expense was $1,064 million and $3,037 million for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, and $406 million and $1,217 million for the fiscal quarter and three fiscal quarters ended July 30, 2023, respectively. The increases were primarily due to interest on debt incurred for the VMware Merger.

Other income, net. Other income, net includes interest income, gains or losses on investments, foreign currency remeasurement and other miscellaneous items. Other income, net, was $82 million and $124 million for the fiscal quarters ended August 4, 2024 and July 30, 2023, respectively. The decrease was primarily due to lower interest income as a result of a lower invested balance. Other income, net, was $354 million and $380 million for the three fiscal quarters ended August 4, 2024 and July 30, 2023, respectively. The decrease was primarily due to lower gains on investments.

Provision for income taxes. The provision for income taxes was $4,238 million and $4,190 million for the fiscal quarter and three fiscal quarters ended August 4, 2024, respectively, and $271 million and $572 million for the fiscal quarter and three fiscal quarters ended July 30, 2023, respectively. The increases were primarily due to the impact of the intra-group transfer of certain IP rights to the United States as a result of supply chain realignment and the resulting shift in the jurisdictional mix of income.

Liquidity and Capital Resources

The following section discusses our principal liquidity and capital resources as well as our principal liquidity requirements and uses of cash. Our cash and cash equivalents are maintained in highly liquid investments with remaining maturities of 90 days or less at the time of purchase. We believe our cash equivalents are liquid and accessible.

Our primary sources of liquidity as of August 4, 2024 consisted of: (i) $9,952 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.

Our short-term and long-term liquidity requirements primarily arise from: (i) business acquisitions and investments we may make from time to time, (ii) working capital requirements, (iii) research and development and capital expenditure needs, (iv) cash dividend payments (if and when declared by our Board of Directors), (v) interest and principal payments related to our $72,319 million of outstanding indebtedness and (vi) payment of income taxes. 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. Our debt and liquidity needs increased in fiscal year 2024 as a result of completing the VMware Merger. We funded the cash portion of the consideration with net proceeds from the issuance of $30,390 million in term loans (the “2023 Term Loans”), as well as cash on hand. We also assumed $8,250 million of VMware’s outstanding senior unsecured notes. During the fiscal quarter ended August 4, 2024, we repaid the remaining outstanding balance of the term A-2 facility. We also expect capital expenditures to be higher in fiscal year 2024 as compared to fiscal year 2023.

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 and assumed obligations for at least the next 12 months. For additional information regarding our cash requirement from contractual obligations and indebtedness, see Note 11. “Commitments and Contingencies” and Note 7. “Borrowings” in Part I, Item 1 of this Form 10-Q.

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, or unanticipated capital expenditures, our business and financial condition could suffer. In such circumstances, we may seek to obtain new

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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 senior unsecured notes, the 2023 Term Loans and any other indebtedness we may incur will depend on our ability to generate cash in the future. We may also elect to sell additional debt or equity securities for reasons other than those specified above.

In addition, we may, at any time and from time to time, seek to retire or purchase our outstanding debt through cash tenders and/or exchanges for equity or debt, in open-market purchases, privately negotiated transactions or otherwise. Such tenders, exchanges or purchases, if any, will be upon such terms and at such prices as we may determine, and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. We may also make additional prepayments of the 2023 Term Loans. The amounts involved may be material.

Working Capital

On November 22, 2023, we completed the VMware Merger. The following table presents the changes in selected balance sheet captions other than assets acquired and liabilities assumed from the VMware Merger during the three fiscal quarters ended August 4, 2024.

						Balances at October 29, 2023						Balances Acquired and Assumed from VMware						Balances at August 4, 2024						Non-VMware Acquisition Increase (Decrease)
						(In millions)
Cash and cash equivalents						$	14,189					$	6,642					$	9,952					$	(10,879)
Trade accounts receivable, net						$	3,154					$	3,571					$	4,665					$	(2,060)
Other current assets						$	1,606					$	5,963					$	3,436					$	(4,133)
Accounts payable						$	1,210					$	359					$	1,757					$	188
Employee compensation and benefits						$	935					$	848					$	1,725					$	(58)
Current portion of long-term debt						$	1,608					$	1,264					$	3,161					$	289
Other current liabilities						$	3,652					$	12,942					$	12,578					$	(4,016)

• Cash and cash equivalents decreased primarily due to $32,058 million paid for the VMware Merger, $7,330 million of dividend payments, $7,176 million of common stock repurchases and $4,012 million of employee withholding tax payments related to net settled equity awards, offset in part by $22,849 million in net proceeds from borrowings, $14,358 million in net cash provided by operating activities, and $3,485 million proceeds from the sale of the EUC business.

• Trade accounts receivable, net decreased primarily due to strong collections and additional receivables sold through factoring arrangements.

• Other current assets decreased primarily due to the sale of the EUC business, offset in part by an increase in contract assets.

• Accounts payable increased primarily due to the timing of payments and an increase in purchases.

• Current portion of long-term debt increased due to $1,245 million becoming due within the next twelve months, offset in part by $941 million of repayments.

• Other current liabilities decreased due to the sale of the EUC business as well as a decrease in contract liabilities as software revenue was recognized.

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Capital Returns

						Three Fiscal Quarters Ended
Cash Dividends Declared and Paid						August 4, 2024						July 30, 2023
						(In millions, except per share data)
Dividends per share to common stockholders						$	1.575					$	1.380
Dividends to common stockholders						$	7,330					$	5,741

During the three fiscal quarters ended August 4, 2024 and July 30, 2023, we repurchased and retired approximately 67 million and 90 million shares of our common stock for $7,176 million and $5,701 million, respectively. All $20 billion under our previously authorized stock repurchase programs was utilized prior to expiration on December 31, 2023.

During the three fiscal quarters ended August 4, 2024 and July 30, 2023, we paid approximately $4,012 million and $1,407 million, respectively, in employee withholding taxes due upon the vesting of net settled equity awards. We withheld approximately 30 million and 21 million shares of common stock from employees in connection with such net share settlements during the three fiscal quarters ended August 4, 2024 and July 30, 2023, respectively.

Cash Flows

						Three Fiscal Quarters Ended
						August 4, 2024						July 30, 2023
						(In millions)
Net cash provided by operating activities						$	14,358					$	13,257
Net cash used in investing activities						(22,938)						(565)
Net cash provided by (used in) financing activities						4,343						(13,053)
Net change in cash and cash equivalents						$	(4,237)					$	(361)

Operating Activities

Cash flows from operating activities consisted of net income adjusted for certain non-cash and other items and changes in assets and liabilities. The $1,101 million increase in cash provided by operations during the three fiscal quarters ended August 4, 2024 compared to the prior year fiscal period was primarily due to contributions from VMware. The $8,987 million decrease in net income was largely driven by $11,990 million of higher non-cash adjustments including amortization of intangible assets, deferred taxes and other non-cash taxes, and stock-based compensation related to the VMware Merger.

Investing Activities

Cash flows from investing activities primarily consisted of cash used for acquisitions, proceeds from the sale of a business, capital expenditures and proceeds and payments related to investments. The $22,373 million increase in cash used in investing activities during the three fiscal quarters ended August 4, 2024 compared to the prior year fiscal period was primarily due to a $25,961 million increase in cash used for acquisitions due to the VMware Merger and the acquisition of Seagate’s SoC operations, net of cash acquired, offset in part by $3,485 million proceeds from the sale of the EUC business.

Financing Activities

Cash flows from financing activities primarily consisted of proceeds and payments related to our long-term borrowings, dividend payments, stock repurchases and employee withholding tax payments related to net settled equity awards. The $17,396 million increase in cash flows from financing activities during the three fiscal quarters ended August 4, 2024 compared to the prior year fiscal period was primarily due to $34,985 million of net proceeds from the 2023 Term Loans and the July 2024 Senior Notes, partially offset by an $11,876 million increase in payments of debt obligations, a $2,605 million increase in employee withholding tax payments related to net settled equity awards, a $1,589 million increase in dividend payments, and a $1,475 million increase in stock repurchases.

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