Broadcom shares fell sharply despite beating revenue forecasts, as investors sought clearer AI growth signals.
Broadcom (AVGO) shares plunged 12.6% on June 4 after reporting fiscal second-quarter adjusted earnings of $2.44 per share on revenue of $22.19 billion. While results slightly exceeded analyst expectations of $2.40 per share and $22.27 billion in revenue, the lack of a raised AI revenue forecast disappointed investors.
Revenue surged 48% year-over-year from $15 billion, and net income jumped 88% to $9.31 billion. The company guided current-quarter revenue to $29.4 billion, above Wall Street’s $28.53 billion estimate. Despite strong growth, investors focused on Broadcom’s unchanged $100 billion AI semiconductor revenue target for fiscal 2027.
Broadcom remains a key player in the AI infrastructure boom, with shares up 21% this year, outperforming the Nasdaq Composite’s 15.4% gain. The stock has risen nearly sevenfold since the end of 2022, driven by demand for custom AI chips.