Broadcom (NASDAQ:AVGO) Announces Earnings Results, Beats Estimates By $0.10 EPS

Broadcom (NASDAQ:AVGO) announced its earnings results on Wednesday. The semiconductor manufacturer reported $3.32 earnings per share for the quarter, topping analysts’ consensus estimates of $3.22 by $0.10, FiscalAI reports. Broadcom had a net margin of 38.85% and a return on equity of 41.61%. The business had revenue of $29.59 billion during the quarter, compared to the consensus estimate of $29.43 billion. During the same quarter last year, the firm earned $1.69 earnings per share. Broadcom’s quarterly revenue was up 85.5% on a year-over-year basis.

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 Stock Performance

Shares of NASDAQ AVGO traded down $19.22 during midday trading on Thursday, hitting $348.02. The company’s stock had a trading volume of 27,190,273 shares, compared to its average volume of 24,931,670. The stock has a fifty day moving average price of $384.15 and a 200 day moving average price of $377.14. Broadcom has a one year low of $289.96 and a one year high of $495.00. The company has a current ratio of 2.24, a quick ratio of 2.01 and a debt-to-equity ratio of 0.71. The firm has a market capitalization of $1.66 trillion, a price-to-earnings ratio of 58.09, a P/E/G ratio of 0.71 and a beta of 1.44.

Broadcom Announces Dividend

The firm also recently declared a quarterly dividend, which will be paid on Wednesday, September 30th. Stockholders of record on Monday, September 21st will be given 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 payout ratio is 43.33%.

Key Stories Impacting Broadcom

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 the $3.22 consensus estimate. Free cash flow reached $13.7 billion. Broadcom fiscal third-quarter results
• Positive Sentiment: AI semiconductor revenue surged 221% year over year to $16.7 billion, up 54% sequentially. Management also outlined a potential AI semiconductor revenue opportunity of $115 billion in fiscal 2027 and $230 billion in 2028, supported by strong customer demand and bookings. AVGO Q3 earnings call and AI roadmap
• Positive Sentiment: Several firms raised their targets after the report. Cantor Fitzgerald and Rosenblatt lifted targets to $600, BMO to $575, and Macquarie upgraded the shares to Outperform with a $490 target, citing reduced insourcing concerns and strong custom-chip prospects. Analyst target increases
• Neutral Sentiment: Broadcom declared a quarterly dividend of $0.65 per share, payable September 30 to shareholders of record September 21, reinforcing its shareholder-return program. Broadcom dividend announcement
• Negative Sentiment: Fourth-quarter revenue guidance of approximately $34.8 billion came in below estimates near $35.0 billion. Investors viewed the outlook as too conservative relative to AVGO’s premium valuation and elevated AI-growth expectations, making the guidance miss the immediate catalyst for selling. Broadcom quarterly revenue forecast
• Negative Sentiment: Management cited land, power, chip and substrate availability as constraints on data-center deployments. Competition, including Google’s relationship with Marvell, and uncertainty over who will fund increasingly large AI infrastructure projects are also weighing on sentiment. Broadcom CEO on AI supply constraints

Analyst Ratings Changes

Several equities research analysts have weighed in on AVGO shares. BMO Capital Markets lifted their price target on shares of Broadcom from $455.00 to $575.00 and gave the company an “outperform” rating in a research note on Thursday. Morgan Stanley reiterated an “overweight” rating and set a $505.00 price objective (up from $502.00) on shares of Broadcom in a report on Thursday. DA Davidson lifted their price objective on shares of Broadcom from $375.00 to $400.00 and gave the company a “neutral” rating in a report on Thursday, June 4th. Wall Street Zen cut shares of Broadcom from a “strong-buy” rating to a “buy” rating in a report on Saturday, July 18th. Finally, Citigroup reiterated a “buy” rating on shares of Broadcom in a report on Thursday, June 4th. Thirty-one research analysts have rated the stock with a Buy rating and four have assigned a Hold rating to the stock. According to data from MarketBeat, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $502.60.

Insider Buying and Selling at Broadcom

In related news, Director Justine Page sold 1,602 shares of the company’s stock in a transaction that occurred on Monday, June 29th. The shares were sold at an average price of $373.86, for a total transaction 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 represents a 8.42% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. Also, insider Mark Brazeal sold 25,000 shares of the company’s stock in a transaction that occurred on Friday, July 10th. The stock was sold at an average price of $401.33, for a total transaction of $10,033,250.00. Following the sale, the insider directly owned 194,989 shares in the company, valued at $78,254,935.37. This trade represents a 11.36% decrease in their position. The disclosure for this sale is available in the SEC filing. In the last ninety days, insiders sold 61,644 shares of company stock worth $24,016,214. 1.90% of the stock is currently owned by company insiders.

Institutional Trading of Broadcom

Hedge funds and other institutional investors have recently bought and sold shares of the company. Pinnacle Financial Partners Inc. increased its holdings in shares of Broadcom by 3.0% in the 3rd quarter. Pinnacle Financial Partners Inc. now owns 53,093 shares of the semiconductor manufacturer’s stock worth $17,516,000 after buying an additional 1,539 shares during the last quarter. Brighton Jones LLC increased its holdings in shares of Broadcom by 21.8% in the 4th quarter. Brighton Jones LLC now owns 29,683 shares of the semiconductor manufacturer’s stock worth $6,882,000 after buying an additional 5,322 shares during the last quarter. Schnieders Capital Management LLC. increased its holdings in shares of Broadcom by 59.2% in the 2nd quarter. Schnieders Capital Management LLC. now owns 14,518 shares of the semiconductor manufacturer’s stock worth $4,002,000 after buying an additional 5,400 shares during the last quarter. Sivia Capital Partners LLC increased its holdings in shares of Broadcom by 10.1% in the 2nd quarter. Sivia Capital Partners LLC now owns 12,693 shares of the semiconductor manufacturer’s stock worth $3,499,000 after buying an additional 1,160 shares during the last quarter. Finally, Revolve Wealth Partners LLC increased its holdings in shares of Broadcom by 10.4% in the 4th quarter. Revolve Wealth Partners LLC now owns 7,997 shares of the semiconductor manufacturer’s stock worth $1,854,000 after buying an additional 756 shares during the last quarter. Institutional investors own 76.43% of the company’s stock.

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.