Broadcom shares fall after lower-than-expected quarterly outlook
Broadcom reported earnings that beat estimates but gave revenue guidance below analysts' expectations, sending the stock down 5% in after-hours trading.
Broadcom's stock slipped 5% in extended trading on Wednesday after the company issued revenue guidance for the current quarter that fell short of analysts' forecasts. For the fiscal fourth quarter, the chipmaker projected revenue of $34.8 billion, compared with the $35.03 billion expected by LSEG consensus.
In the most recent quarter, Broadcom posted adjusted earnings of $3.32 per share, topping the $3.24 consensus, and revenue of $29.59 billion, slightly above the $29.36 billion estimate. Net income more than tripled to $13.09 billion, or $2.68 per share, from $4.14 billion a year earlier.
The company highlighted its role in the artificial-intelligence market, noting custom chip collaborations with Google, Meta and OpenAI. CEO Hock Tan said Broadcom plans to accelerate shipments of Google’s Ironwood tensor processing units to Anthropic and TPU 8i chips to Google, and that it will continue delivering Jalapeño chips to OpenAI and Meta's MTIA accelerator.
Broadcom also cited upcoming deployment targets, including 5 gigawatts of TPU 8i chips for Anthropic in 2027 and a potential 1.3 gigawatt rollout of Jalapeño chips the same year, with longer-term plans for larger volumes. For fiscal 2028, the company expects AI chip revenue to double again to $230 billion and aims for earnings per share above $30.
Semiconductor revenue rose to $16.7 billion, surpassing the $15.2 billion estimate, while infrastructure software revenue came in at $8.75 billion, slightly below the $8.82 billion consensus.