Broadcom (NASDAQ:AVGO) Announces Quarterly Earnings Results

Broadcom (NASDAQ:AVGO) announced its quarterly earnings data on Wednesday. The semiconductor manufacturer reported $3.32 earnings per share for the quarter, beating the consensus estimate of $3.22 by $0.10, FiscalAI reports. Broadcom had a return on equity of 50.76% and a net margin of 42.94%.The business had revenue of $29.59 billion during the quarter, compared to analyst estimates of $29.24 billion. During the same period in the prior year, the company earned $1.69 earnings per share. Broadcom’s revenue was up 85.5% compared to the same quarter last year.

Here are the key takeaways from Broadcom’s conference call:

• Record results and strong guidance: Q3 revenue reached $29.6 billion, up 86% year over year, while operating margin rose to a record 67.9% and free cash flow reached $13.7 billion. Broadcom expects Q4 revenue of $34.8 billion, up 93% year over year.
• AI semiconductor momentum accelerated: Q3 AI revenue grew 221% year over year to $16.7 billion, and management projects $21.7 billion in Q4 AI revenue. Broadcom raised its fiscal 2026 AI revenue outlook to approximately $58 billion and forecast roughly $115 billion in fiscal 2027 and $230 billion in fiscal 2028.
• Expanding custom-accelerator customer base: Broadcom highlighted growing deployments with Google, Anthropic, OpenAI, and Meta, including multi-year TPU and custom XPU programs. Management said demand exceeds its current outlook, although actual deployments depend on data-center readiness.
• AI networking adoption remains strong: Tomahawk 6 is being deployed by AI hyperscalers, while Tomahawk Ultra is beginning to gain traction in scale-up applications. Broadcom also plans significant capacity expansion for optical components, including EMLs, CW lasers, and VCSELs.
• Supply and margin risks remain: Land, power, data-center construction, leading-edge wafers, substrates, HBM, and other system components could affect deployment timing. Rising memory content and the increasing mix of XPUs are expected to pressure gross margin, with Q4 guidance at approximately 73%, while future financing arrangements for AI customers will be evaluated case by case.

Broadcom Trading Down 2.7%

Shares of AVGO stock opened at $357.16 on Friday. The company has a market capitalization of $1.70 trillion, a PE ratio of 45.61, a price-to-earnings-growth ratio of 0.70 and a beta of 1.44. Broadcom has a 52-week low of $289.96 and a 52-week high of $495.00. The business’s fifty day moving average is $383.71 and its 200 day moving average is $377.36. The company has a debt-to-equity ratio of 0.71, a quick ratio of 2.01 and a current ratio of 2.24.

Broadcom Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Wednesday, September 30th. Stockholders of record on Monday, September 21st will be issued a $0.65 dividend. The ex-dividend date of this dividend is Monday, September 21st. This represents a $2.60 annualized dividend and a dividend yield of 0.7%. Broadcom’s dividend payout ratio is presently 43.33%.

Analyst Upgrades and Downgrades

Several research firms have recently weighed in on AVGO. Jefferies Financial Group began coverage on Broadcom in a research note on Thursday. They set a “buy” rating for the company. BMO Capital Markets increased their target price on shares of Broadcom from $455.00 to $575.00 and gave the stock an “outperform” rating in a research report on Thursday. Lake Street Capital upgraded shares of Broadcom to a “buy” rating in a research note on Thursday. Deutsche Bank Aktiengesellschaft reissued a “buy” rating and issued a $515.00 price target (up from $430.00) on shares of Broadcom in a research report on Thursday, June 4th. Finally, TD Cowen reaffirmed a “buy” rating and issued a $475.00 price objective (down from $500.00) on shares of Broadcom in a report on Thursday. Thirty-one investment analysts have rated the stock with a Buy rating and four have given a Hold rating to the stock. According to data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and a consensus price target of $501.77.

Broadcom News Roundup

Here are the key news stories impacting Broadcom this week:

• Positive Sentiment: Broadcom reported fiscal third-quarter revenue of approximately $29.6 billion, up 86% year over year, and non-GAAP EPS of $3.32, exceeding estimates of $29.24 billion and $3.22. AI semiconductor revenue surged 221% year over year to $16.7 billion, up 54% sequentially, underscoring strong demand for custom AI processors. Broadcom fiscal third-quarter results
• Positive Sentiment: Management raised its AI revenue outlook to $115 billion for fiscal 2027 and projected $230 billion for fiscal 2028, while expressing confidence in fiscal 2027 EPS of at least $30. Analysts at Macquarie, Truist, BMO, Cantor Fitzgerald, KeyBanc and Rosenblatt maintained bullish views or set price targets ranging from $490 to $600. Broadcom AI growth outlook
• Positive Sentiment: Strong cash generation also supports the long-term story: Broadcom produced $13.7 billion in free cash flow during the quarter and declared a quarterly dividend of $0.65 per share. Brokerages’ average recommendation remains “Moderate Buy.” Broadcom brokerage recommendation
• Neutral Sentiment: Wall Street views the long-term AI opportunity favorably, but analysts differ on how much of the growth is already reflected in AVGO’s valuation. RBC reaffirmed a “Sector Perform” rating with a $400 target, indicating more cautious expectations than the highest bullish forecasts. RBC Broadcom outlook
• Negative Sentiment: The immediate catalyst was fiscal fourth-quarter revenue guidance of about $34.8 billion, below the roughly $35.0 billion analyst consensus. The modest outlook miss overshadowed the earnings beat and raised concerns about supply constraints, competition, customer concentration and whether AI infrastructure deployments can proceed quickly enough. Broadcom quarterly revenue forecast
• Negative Sentiment: Because AVGO trades at a premium valuation and entered the report with elevated AI expectations, investors treated “good” results as insufficient. Reports that major funds, including Third Point, exited Broadcom positions and substantial insider selling added to sentiment concerns, although these transactions are not necessarily tied to the current quarter.

Insiders Place Their Bets

In other Broadcom news, Director Gayla Delly sold 1,890 shares of the firm’s stock in a transaction dated Wednesday, July 8th. The stock was sold at an average price of $385.38, for a total value of $728,368.20. Following the sale, the director owned 31,326 shares of the company’s stock, valued at $12,072,413.88. This trade represents a 5.69% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, Director Justine Page sold 1,602 shares of Broadcom stock in a transaction dated Monday, June 29th. The shares were sold at an average price of $373.86, for a total value of $598,923.72. Following the sale, the director owned 17,426 shares of the company’s stock, valued at approximately $6,514,884.36. This trade represents a 8.42% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 61,644 shares of company stock valued at $24,016,214 over the last 90 days. 1.90% of the stock is owned by insiders.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. ROSS JOHNSON & Associates LLC lifted its stake in Broadcom by 1,320.0% during the fourth quarter. ROSS JOHNSON & Associates LLC now owns 71 shares of the semiconductor manufacturer’s stock worth $25,000 after purchasing an additional 66 shares during the last quarter. SWAN Capital LLC increased its position in shares of Broadcom by 261.9% during the 4th quarter. SWAN Capital LLC now owns 76 shares of the semiconductor manufacturer’s stock valued at $26,000 after purchasing an additional 55 shares during the last quarter. AlphaCentric Advisors LLC purchased a new position in shares of Broadcom during the 4th quarter valued at about $55,000. FSA Wealth Management LLC raised its holdings in shares of Broadcom by 130.7% during the 3rd quarter. FSA Wealth Management LLC now owns 233 shares of the semiconductor manufacturer’s stock valued at $77,000 after buying an additional 132 shares in the last quarter. Finally, IFC & Insurance Marketing Inc. bought a new stake in Broadcom in the 4th quarter worth approximately $82,000. 76.43% of the stock is currently owned by hedge funds and other institutional investors.

Broadcom Company Profile

Broadcom Inc (NASDAQ: AVGO) is a global technology company that designs, develops and supplies semiconductor and infrastructure software solutions for a broad range of markets. The company’s semiconductor business provides components and systems for wired and wireless communications, enterprise and cloud storage, networking and broadband access, serving original equipment manufacturers, cloud service providers, telecommunications carriers and industrial customers worldwide. Broadcom is headquartered in Irvine, California, and operates globally with research, development and sales organizations across North America, Europe and Asia.

On the semiconductor side, Broadcom’s portfolio includes system-on-chip (SoC) and application-specific integrated circuit (ASIC) solutions, radio-frequency and connectivity components, Ethernet switching and PHY devices, storage adapters and controllers, optical transceivers and other networking silicon.