Can Broadcom’s AI Ambitions Revive Its Stock After Previous Setback?

Broadcom reports fiscal third-quarter results after the market closes on Wednesday, and the number investors are waiting on is $16 billion — the AI chip revenue guidance CEO Hock Tan set in June, and the bar that will decide whether a beat can finally translate into a rally rather than another selloff.

Broadcom has guided total quarterly revenue to $29.4 billion, up 84% from a year earlier, with AI semiconductor revenue accounting for more than half of that at $16 billion, an increase of over 200% year-on-year. Non-GAAP operating margin is guided at roughly 67% of revenue.

The stakes trace back to June 3, when Broadcom beat estimates on adjusted earnings — $2.44 a share against a $2.40 consensus — yet shares still fell as much as 13% in the sessions that followed. The trigger wasn't the quarter itself: Tan declined to raise the company's standing fiscal 2027 AI semiconductor target beyond "in excess of $100 billion," a figure investors had expected to move higher given the pace of orders.

Those orders are the reason expectations are running high again. Broadcom told analysts on its June earnings call that AI semiconductor bookings topped $30 billion in the second quarter against just $10.8 billion actually shipped, a gap management has pointed to as evidence of multi-year demand from a customer base that includes Google, Meta, OpenAI and Anthropic — all of which use Broadcom's custom-designed accelerators or networking silicon inside their data centers.

Whether Tan lifts the $100 billion fiscal 2027 target this time, rather than holding it flat again, is what analysts will be listening for on the call, scheduled for 2 p.m. Pacific time — the same disclosure that set off June's selloff despite a beat.