During the third quarter, the Company generated $963 million in cash from operations and received $630 million in net cash proceeds from the completion of previously announced divestitures. In the third quarter, the Company repaid $1,306 million of its outstanding term loans and spent $232 million on capital expenditures.
On June 30, 2016, the Company paid a cash dividend of $0.50 per ordinary share, totaling $199 million. On the same date, the Partnership, of which the Company is the General Partner, paid holders of REUs a corresponding distribution of $0.50 per REU, totaling $12 million.
Third Quarter Fiscal Year 2016 Non-GAAP Results From Continuing Operations
The differences between the Company’s GAAP and non-GAAP results are described generally under “Non-GAAP Financial Measures” below, and presented in detail in the financial reconciliation tables attached to this release.
Net revenue from continuing operations was $3,802 million, an increase of 7 percent from $3,562 million in the previous quarter, and an increase of 117 percent from $1,750 million in the same quarter last year.
Gross margin from continuing operations was $2,297 million, or 60.4 percent of net revenue. This compares with gross margin of $2,138 million, or 60.0 percent of net revenue, in the prior quarter, and gross margin of $1,063 million, or 60.7 percent of net revenue, in the same quarter last year.
Operating income from continuing operations was $1,489 million, or 39 percent of net revenue. This compares with operating income from continuing operations of $1,329 million, or 37 percent of net revenue, in the prior quarter, and $733 million, or 42 percent of net revenue, in the same quarter last year.
Net income from continuing operations was $1,293 million, or $2.89 per diluted share. This compares with net income of $1,120 million, or $2.53 per diluted share last quarter, and net income of $660 million, or $2.24 per diluted share, in the same quarter last year.
| Third Quarter Fiscal Year 2016 Non-GAAP Results | Change | |||||||||||||||||||
| (Dollars in millions, except per share data) | Q3 16 | Q2 16 | Q3 15 | Q/Q | Y/Y | |||||||||||||||
| Net revenue | $ | 3,802 | $ | 3,562 | $ | 1,750 | +7 | % | +117 | % | ||||||||||
| Gross margin | 60.4 | % | 60.0 | % | 60.7 | % | +40bps | -30bps | ||||||||||||
| Operating expenses | $ | 808 | $ | 809 | $ | 330 | -$ | 1 | +$ | 478 | ||||||||||
| Net income | $ | 1,293 | $ | 1,120 | $ | 660 | +$ | 173 | +$ | 633 | ||||||||||
| Earnings per share - diluted | $ | 2.89 | $ | 2.53 | $ | 2.24 | +$ | 0.36 | +$ | 0.65 | ||||||||||
“We delivered strong third quarter financial results with 7 percent sequential growth in revenue and 14 percent sequential growth in EPS, a clear demonstration of the leverage inherent in our operating model” said Hock Tan, President and CEO of Broadcom Limited. “We are expecting an even stronger performance in the fourth quarter, driven by robust growth in our wireless segment.”
Other Quarterly Data
| Q3 16 | Q2 16 | Q3 15 | Growth Rates | ||||||||||||||||||||||||||||
| Net revenue by segment: | Q/Q | Y/Y | |||||||||||||||||||||||||||||
| Wired infrastructure | $ | 2,062 | 54 | % | $ | 2,060 | 58 | % | $ | 372 | 21 | % | - | 454 | % | ||||||||||||||||
| Wireless communications | 1,008 | 27 | 792 | 22 | 616 | 36 | 27 | % | 64 | % | |||||||||||||||||||||
| Enterprise storage | 527 | 14 | 525 | 15 | 588 | 34 | - | -10 | % | ||||||||||||||||||||||
| Industrial & other | 195 | 5 | 164 | 5 | 159 | 9 | 19 | % | 23 | % | |||||||||||||||||||||
| Total net revenue | $ | 3,792 | 100 | % | $ | 3,541 | 100 | % | $ | 1,735 | 100 | % | |||||||||||||||||||
| Q3 16 | Q2 16 | Q3 15 | Growth Rates | ||||||||||||||||||||||||||||
| Non-GAAP net revenue by segment: | Q/Q | Y/Y | |||||||||||||||||||||||||||||
| Wired infrastructure (1) | $ | 2,065 | 54 | % | $ | 2,063 | 58 | % | $ | 372 | 21 | % | - | 455 | % | ||||||||||||||||
| Wireless communications | 1,008 | 27 | 792 | 22 | 616 | 35 | 27 | % | 64 | % | |||||||||||||||||||||
| Enterprise storage | 527 | 14 | 525 | 15 | 588 | 34 | - | -10 | % | ||||||||||||||||||||||
| Industrial & other (1) | 202 | 5 | 182 | 5 | 174 | 10 | 11 | % | 16 | % | |||||||||||||||||||||
| Total non-GAAP net revenue | $ | 3,802 | 100 | % | $ | 3,562 | 100 | % | $ | 1,750 | 100 | % | |||||||||||||||||||
| (1) Non-GAAP data include the effect of acquisition-related purchase accounting revenue adjustments relating to licensing revenue.
| |||||||||||||||||||||||||||||||
