Broadcom Stock Plunges 15% on Disappointing AI Chip Forecast
Broadcom shares fell over 14% on June 4, 2026, after its fiscal Q3 AI chip revenue forecast of $16 billion missed analyst estimates of $17.2–$17.3 billion, despite beating Q2 earnings and revenue expectations. The sell-off dragged down AMD and Intel. CEO Hock Tan reaffirmed a long-term AI revenue target of over $100 billion by 2027. Analysts attributed the miss to supply constraints and elevated market expectations, not weak demand, with key clients including Meta, Google, and OpenAI.
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Broadcom and OpenAI Unveil Jalapeño: An Early Step to Massive AI Growth Potential
Broadcom and OpenAI have unveiled 'Jalapeño,' OpenAI's first Intelligence Processor, advancing their 10-gigawatt partnership toward a potential $200 billion revenue opportunity. The chip is a key step in Broadcom's custom ASIC deployment for OpenAI, scheduled to begin generating significant revenue in 2027. Broadcom CEO Hock Tan confirmed the partnership is on track, with full 10 GW deployment expected by end of 2029. Analyst estimates suggest each GW could yield around $20 billion in revenue for Broadcom. Broadcom shares currently trade at about 62x earnings, below the three-year average of 80x, as the market awaits revenue realization from this massive AI infrastructure deal.
Yahoo FinanceBroadcom Stock Investors Just Got Fantastic News From OpenAI
Broadcom (NASDAQ: AVGO) received a significant boost as OpenAI and Broadcom unveiled a new custom AI processor named 'Jalapeño,' marking OpenAI's first move into physical silicon design. The chip was built from the ground up to optimize performance for large language models like ChatGPT and Codex, with AI tools themselves accelerating the chip development process. Early tests indicate the chip's performance per watt will be 'substantially better' than current cutting-edge processors, achieved by minimizing data movement and reducing latency. Broadcom CEO Hock Tan described this as the first step in a 'multi-generation roadmap' reflecting a commitment to scaling AI infrastructure. While Broadcom stock has been volatile (currently 21% off its peak and fell 41% in early 2025), this collaboration with OpenAI strengthens its position among elite AI customers including Alphabet, Meta, and ByteDance. The article notes Broadcom's 580% gain since early 2023 but cautions about ongoing volatility and uncertainty in AI adoption.
Yahoo FinanceJPMorgan Recommends Aggressive Buying of Broadcom After Steep AI Stock Decline
On June 22, 2026, JPMorgan reiterated its Overweight rating on Broadcom (AVGO) with a $580 price target, urging clients to be 'aggressive buyers' following a 17% stock decline triggered by a record Q2 earnings report. Despite Broadcom posting $22.19 billion in revenue—beating consensus and raising guidance—the stock fell from $495 to $385 due to valuation concerns, customer concentration (Anthropic, OpenAI, Meta, Google), and a broader chip rout. AI semiconductor revenue surged 143% YoY to $10.8B, with Q3 AI guidance of $16B and $56B for fiscal 2026. JPMorgan argues the market underestimates Broadcom's advanced packaging dominance and its AI chip development with Google. However, the article notes 44 buy ratings with zero sells, yet insiders have been net sellers over 35 recent transactions, and gross margins are compressing.
Yahoo FinanceCathie Wood Buys Broadcom Stock Dip After Q2 Earnings Miss on AI Guidance
Cathie Wood's Ark Invest purchased 22,000 shares of Broadcom (AVGO) worth $5.90 million, capitalizing on a 12.6% intraday drop on June 4 following the company's Q2 FY2026 results. Broadcom reported revenue of $22.19 billion (up 48% YoY), beating estimates, with AI semiconductor revenue surging 143% to $10.80 billion. However, Q3 AI revenue guidance of $16 billion fell short of analyst expectations of $17.30 billion, and the company reiterated its $100 billion AI revenue target for fiscal 2027, which the market had already priced in. Concerns about declining gross margins due to a higher mix of lower-margin AI chips also weighed on the stock. Despite the dip, analysts remain bullish, with Jefferies raising its price target to $550. Broadcom's stock is down 24.83% from its 52-week high of $495.
Yahoo FinanceBroadcom CEO unnerves AI backers with 'chips only' pivot, stock slides 18%
Broadcom posted record quarterly revenue of $22.19 billion, with AI semiconductor revenue surging 143% year over year to $10.8 billion. Despite the strong results, shares fell 12.59% on June 4 and continued sliding to $396.60 by June 9, an 18.64% drop over five trading days. The selloff was driven by CEO Hock Tan's comments on the earnings call, where he reaffirmed the $100 billion AI revenue target for fiscal 2027 instead of raising it, and announced a strategic pivot to selling 'chips only,' stepping back from fully integrated AI systems. This shift dampens expectations for higher-margin business, with gross margins guided down to 74% from 77%. Tan also acknowledged that Google, Broadcom's largest AI customer, will likely use multiple chip suppliers going forward. The company's six core custom-chip customers include Anthropic, Google, Meta, and OpenAI.
Yahoo FinanceAnthropic and OpenAI Let Broadcom Finance Their Own Chips Amid Compute Desperation
Broadcom CEO Hock Tan announced a partnership with Apollo Global Management and Blackstone to create an AI XPU platform that will finance custom AI chips for large language model developers like Anthropic and OpenAI. The initiative aims to deploy over 20 gigawatts of compute capacity by 2028, with Apollo launching the first $35 billion tranche. This addresses the enormous infrastructure costs AI companies face as they scale models, with demand visibility now extending through 2028. Broadcom also reported Q2 earnings of $2.44 per share, beating analyst estimates of $2.40, while revenue of $22.19 billion narrowly missed consensus of $22.27 billion.
Yahoo FinanceBroadcom Shares Plunge 14% on AI Guidance Miss Despite Strong Q2 Results
Broadcom shares fell over 14% on June 4, 2026, after the chipmaker's fiscal Q3 AI revenue guidance of $16 billion missed analyst estimates of $17.3 billion, and it reiterated a fiscal 2027 AI revenue target of over $100 billion that investors had already priced higher. The decline occurred despite strong Q2 results, with revenue of $22.2 billion and EPS of $2.44 beating expectations. Analysts at Bank of America and UBS viewed the guidance as conservatism due to supply constraints, not demand weakness, citing growth catalysts from custom chip clients like Anthropic, Meta, and OpenAI. Jefferies flagged gross margin pressure, while Baird highlighted a risk from Broadcom's largest custom silicon customer shifting inferencing workloads to Taiwan-based MediaTek, potentially causing multiple contraction. The company's AI growth trajectory remains strong, with approximately 180% year-over-year growth in fiscal 2026 and nearly 100% in fiscal 2027.
Yahoo FinanceBroadcom Plunges 14% on Weak AI Chip Forecast Despite Earnings Beat, Pulling Down AMD and Intel
Broadcom shares fell 14% on June 4, 2026, after the company issued fiscal Q3 AI chip guidance of $16 billion, missing the $17.2 billion analyst consensus, despite beating overall earnings and revenue estimates. The sell-off dragged down AMD (down 4%) and Intel (down 3%) on sympathy, as both had rallied significantly in the past year. Broadcom's AI semiconductor revenue grew 143% year-over-year to $10.8 billion, but the lower-than-expected forward guidance triggered a 'sell-the-news' reaction and a downgrade to Neutral with a $437 price target. CEO Hock Tan reaffirmed long-term AI revenue exceeding $100 billion by 2027, even as hyperscaler AI spending nears $650 billion this year.
Yahoo FinanceBroadcom Q2 2026 Earnings: AI Chip Revenue Doubles, Stock Sinks
Broadcom reported Q2 2026 revenue of $22.19 billion, up 48% year-over-year, driven by AI chip sales which doubled to $10.8 billion (up 143%). However, the stock fell 12% in after-hours trading as the company's Q3 AI semiconductor revenue forecast of $16 billion missed analyst expectations of $17.2 billion. CEO Hock Tan noted that Google would likely use multiple chip suppliers and that surging AI semiconductor sales are diluting overall gross margins. Full-year AI chip revenue guidance remains unchanged at over $100 billion. Total Q3 revenue guidance of $29.4 billion topped analyst estimates. The semiconductor solutions segment generated $15 billion, while infrastructure software brought in $7.18 billion. Net income rose 88% to $9.31 billion. Broadcom's custom AI chip customers include Google, Meta, Anthropic, and OpenAI.
Yahoo FinanceBroadcom Misses Revenue Estimates, AI Chip Forecast Disappoints; Shares Plunge
Chipmaker Broadcom reported second-quarter revenue of $22.19 billion, missing Wall Street estimates of $22.27 billion, and issued a weaker-than-expected AI chip revenue forecast of $16 billion for the current quarter, below the $16.36 billion consensus. The news sent shares down over 13% in extended trading. CEO Hock Tan maintained the long-range forecast of $100 billion in AI chip sales by 2027, despite slightly raising the expected shipment volume to over 10 gigawatts. Analysts noted the market demands perfection for the chip rally to continue. Broadcom faces intensifying competition from Nvidia and Marvell Technology, and its supply chain remains strained, though executives expressed confidence in securing supply for 2026 and 2027. The company forecast third-quarter revenue of about $29.4 billion, above analyst estimates of $28.54 billion, and its core custom chip business with Meta and Google remains strong amid expected Big Tech AI infrastructure spending of over $700 billion this year.
Yahoo FinanceWall Street Cheers Broadcom Stock as It Aims to Supercharge the Smart Home Industry
Broadcom (AVGO) launched its Edge AI broadband portfolio, including a 50G PON gateway system-on-chip with an integrated neural processing unit and Wi-Fi 8 support, targeting smart homes and enterprise applications. The company is partnering with Samsung and telecom operators to enable network operators to monetize fiber and 5G infrastructure through distributed AI services. Wall Street responded positively, sending Broadcom's stock higher ahead of its Q2 FY2026 earnings report. Broadcom's Q1 revenue hit a record $19.31 billion, up 29% year-over-year, exceeding expectations. The stock has gained 88.33% over the past 52 weeks and reached an all-time intraday high of $488.82 on June 2. The company's forward P/E ratio of 42.38x is above the industry average of 26.65x.
Yahoo FinanceBroadcom stock sinks 15% as AI chip forecast disappoints
Broadcom (AVGO) stock fell over 15% on Thursday, its biggest one-day drop since January 2025, after the company's AI chip sales forecast for the third quarter missed analyst estimates. The company reported Q2 revenue of $22.19 billion (slightly above consensus of $22.13 billion) and EPS of $2.44 (above $2.39 estimate). However, AI chip sales for the current quarter were projected at $16 billion, below the $17.2 billion consensus. Broadcom also did not raise its full-year AI semiconductor revenue forecast, though CEO Hock Tan reiterated guidance of over $100 billion for fiscal 2027. The stock had hit multiple all-time highs in the prior five sessions, setting a high bar. Analysts noted the market's elevated expectations contributed to the sharp selloff. Broadcom benefits from hyperscaler AI spending, estimated at $650 billion this year, with customers including Google, Meta, Anthropic, and OpenAI.
Yahoo FinanceBroadcom stock sinks 12% as AI chip forecast disappoints
Broadcom (AVGO) stock fell approximately 12% on June 4, 2026, after the company's AI chip sales outlook for the third quarter missed analysts' estimates. The company reported Q2 revenue of $22.19 billion (slightly above consensus of $22.13 billion) and EPS of $2.44 (above estimates of $2.39). However, AI chip sales for the current quarter were projected at $16 billion, below the $17.2 billion consensus. Broadcom did not raise its full-year AI semiconductor revenue forecast, though CEO Hock Tan reiterated guidance of over $100 billion for fiscal 2027. The stock had hit multiple all-time highs in the prior five sessions, leading analysts to note that expectations were extremely high. Broadcom benefits from AI infrastructure spending by hyperscalers including Google, Meta, Anthropic, and OpenAI, with total AI spending estimated at $650 billion this year.
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