Broadcom’s semiconductor solutions revenue more than doubled to $20.8 billion in the nine months ended August 2, from $9.2 billion a year earlier. Infrastructure software grew too, but at a more measured 29%, to $8.8 billion.

That mix produced a striking set of numbers: total revenue rose 85.5% to $29.6 billion, while operating income climbed 171% to $16.0 billion. Gross margin widened by 2 percentage points to 69.1%, and operating cash flow reached $33.0 billion.

The less tidy part sits below the income statement. Inventory grew 107.5% to $4.5 billion, and accounts receivable rose 111.1% to $13.7 billion. Both expanded faster than sales. Capex also jumped 162.4% to $1.0 billion, although the company still ended the period with $24.0 billion in cash.

Broadcom attributes the semiconductor surge to AI-related demand. It also says the margin improvement came mainly from revenue growth, with one important qualification: semiconductor solutions carry lower gross margins than infrastructure software.

"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."

Broadcom, 10-Q filed September 10, 2026.

In plain English, the faster-growing business is the lower-margin one, yet the scale of the sales increase more than offset that mix effect. The result was operating margin of 53.9%, up from 36.9% in the comparable nine-month period.

The software growth also includes a recognition detail that matters for reading the topline. Broadcom said VMware Cloud Foundation demand was strong, including license revenue recognized on contracts where customers do not have the right to terminate.

"Net revenue from our infrastructure software segment increased in the fiscal quarter and three fiscal quarters ended August 2, 2026 compared to the prior year fiscal periods primarily due to strong demand for our VMware Cloud Foundation (“VCF”) product, including additional license revenue recognized on contracts where customers do not have the right to terminate."

Broadcom, 10-Q filed September 10, 2026.

That explanation combines two elements in the reported growth: demand for VCF and the timing of revenue recognition on non-terminable contracts. Broadcom’s own explanation includes both.

The cash picture adds another layer. Operating cash flow grew 66.1%, slower than revenue, while capex rose much faster than sales. Free cash flow margin nevertheless improved by 2.5 percentage points, and cash increased despite $8.5 billion of repurchases, $9.3 billion of dividends, and $6.1 billion of net debt payments.

Broadcom’s annual history gives the expansion some context: revenue rose from $35.8 billion in fiscal 2023 to $63.9 billion in fiscal 2025, while annual operating margin moved from 45.2% to 39.9% over that span. The latest nine-month margin is a sharp step above both, but the balance-sheet growth is moving at its own pace.

Broadcom’s next 10-Q will provide the next comparable read on whether inventory, receivables, and capex continue to outpace sales as AI demand remains the stated driver.

The unresolved tension is simple: growth is accelerating, and so are the balances needed to carry it.

Source: Broadcom’s 10-Q filed September 10, 2026, for the nine months ended August 2, 2026.