BROADCOM INC.

FINANCIAL RECONCILIATION: GAAP TO NON-GAAP - UNAUDITED

(IN MILLIONS)

Fiscal Quarter Ended

January 29,

October 30,

January 30,

2023

2022

2022

Gross margin on GAAP basis

$

6,004

$

5,926

$

5,049

Amortization of acquisition-related intangible assets

535

705

730

Stock-based compensation expense

37

38

36

Restructuring charges

2

1

2

Acquisition-related costs

-

3

4

Gross margin on non-GAAP basis

$

6,578

$

6,673

$

5,821

Research and development on GAAP basis

$

1,195

$

1,197

$

1,206

Stock-based compensation expense

267

260

268

Acquisition-related costs

(1)

-

-

Research and development on non-GAAP basis

$

929

$

937

$

938

Selling, general and administrative expense on GAAP basis

$

348

$

370

$

321

Stock-based compensation expense

87

89

83

Acquisition-related costs

42

45

11

Selling, general and administrative expense on non-GAAP basis

$

219

$

236

$

227

Total operating expenses on GAAP basis

$

1,901

$

1,940

$

1,941

Amortization of acquisition-related intangible assets

348

358

397

Stock-based compensation expense

354

349

351

Restructuring, impairment and disposal charges

10

15

17

Acquisition-related costs

41

45

11

Total operating expenses on non-GAAP basis

$

1,148

$

1,173

$

1,165

Operating income on GAAP basis

$

4,103

$

3,986

$

3,108

Amortization of acquisition-related intangible assets

883

1,063

1,127

Stock-based compensation expense

391

387

387

Restructuring, impairment and disposal charges

12

16

19

Acquisition-related costs

41

48

15

Operating income on non-GAAP basis

$

5,430

$

5,500

$

4,656

Other income (expense), net on GAAP basis

$

143

$

40

$

(14)

(Gains) losses on investments

(44)

29

16

Other income, net on non-GAAP basis

$

99

$

69

$

2

Provision for income taxes on GAAP basis

$

66

$

261

$

215

Non-GAAP tax reconciling adjustments

574

358

295

Provision for income taxes on non-GAAP basis

$

640

$

619

$

510

Net income on GAAP basis

$

3,774

$

3,359

$

2,472

Amortization of acquisition-related intangible assets

883

1,063

1,127

Stock-based compensation expense

391

387

387

Restructuring, impairment and disposal charges

12

16

19

Acquisition-related costs

41

48

15

(Gains) losses on investments

(44)

29

16

Non-GAAP tax reconciling adjustments

(574)

(358)

(295)

Net income on non-GAAP basis

$

4,483

$

4,544

$

3,741

Weighted-average shares used in per share calculations - diluted on GAAP basis

429

429

429

Non-GAAP adjustment ⁽¹⁾

5

6

17

Weighted-average shares used in per share calculations - diluted on non-GAAP basis

434

435

446

Net income on non-GAAP basis

$

4,483

$

4,544

$

3,741

Interest expense

406

406

407

Provision for income taxes on non-GAAP basis

640

619

510

Depreciation

127

129

136

Amortization of purchased intangibles and right-of-use assets

22

24

24

Adjusted EBITDA

$

5,678

$

5,722

$

4,818

Net cash provided by operating activities

$

4,036

$

4,583

$

3,486

Purchases of property, plant and equipment

(103)

(122)

(101)

Free cash flow

$

3,933

$

4,461

$

3,385

 Fiscal
Quarter
Ending 

April 30,

Expected average diluted share count ⁽²⁾ : 

2023

Weighted-average shares used in per share calculation - diluted on GAAP basis

429

Non-GAAP adjustment ⁽¹⁾

9

Weighted-average shares used in per share calculation - diluted on non-GAAP basis

438

(1) Non-GAAP adjustment for the number of shares used in the diluted per share calculations excludes the impact of stock-based compensation
expense expected to be incurred in future periods and not yet recognized in the financial statements, which would otherwise be assumed to be used to
repurchase shares under the GAAP treasury stock method. In addition, the non-GAAP adjustment includes the impact of Mandatory Convertible
Preferred Stock that was antidilutive on a GAAP basis for the fiscal quarter ended January 30, 2022. 

.

(2) Excludes the effects of potential share repurchases.