Citi says Broadcom reported above-consensus fiscal Q3 results due to strength from its artificial intelligence business and VMware, but guided Q4 gross margin lower due to the ramp of its AI accelerator business. The firm believes margins should trend higher in fiscal 2025 driven by accretion from VMware. It reiterates a Buy rating on Broadcom with a $175 price target citing upside to consensus from AI strength and earnings accretion from VMware.
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