New York, January 21, 2026, 4:31 PM EST — After-hours
- Broadcom shares dipped roughly 1% on Wednesday, following a steep decline the previous day.
- The U.S. GSA has rolled out a new OneGov agreement, slashing prices by as much as 64% on certain VMware/Tanzu and security software through May 2027.
- Tariff news is catching investors’ attention as Broadcom gears up to report earnings on March 4, after the market closes.
Broadcom shares dropped 1.1% to close at $328.80 on Wednesday, after bouncing between $324.30 and $337.81 during the session. Trading volume hit roughly 31.7 million shares.
The move came after Tuesday’s sharp selloff, marking Wall Street’s largest daily decline in three months amid renewed jitters over volatility triggered by President Donald Trump’s tariff threats against European allies. Trump announced that a 10% import tariff would kick in February 1, with plans to raise it further on June 1 unless a deal on Greenland is reached, Reuters reported. 1
Broadcom has emerged as a crucial indicator for gauging how quickly major clients are ramping up AI infrastructure and the profits they’re pulling from it. The stock’s drop last December following its earnings report raised fresh concerns about whether growth driven by AI comes at the cost of slimmer margins. 2
Broadcom announced Wednesday that it reached a OneGov agreement with the U.S. General Services Administration. This deal gives federal agencies access to select Broadcom software at a steep 64% discount off the list price, effective through May 2027. The discounted package covers VMware Tanzu Platform, Tanzu Data Intelligence, VMware vDefend, and VMware Avi Load Balancer, according to Broadcom. 3
Broadcom CEO Hock Tan described the deal as a move that “reinforces our commitment to optimizing value” for federal agencies, FedScoop reported. GSA Administrator Ed Forst added the agreement would “save taxpayers money,” the outlet said. 4
Tech stocks linked to corporate spending are still on shaky ground. On Tuesday, Morgan Stanley cut its rating on the IT hardware sector, citing a “perfect storm” of slowing demand, rising input costs, and “rich valuations.” The firm said it’s shifting to a more defensive stance heading into 2026. 5
Tariff worries cooled off midweek, but the market’s still mixed. Stocks in the U.S. edged up Wednesday after Trump announced a Greenland framework deal and scrapped the planned tariffs, pushing the Dow, S&P 500, and Nasdaq roughly 1% higher, according to Reuters. 6
Broadcom took a big hit Tuesday, tumbling 5.43% to $332.60, lagging behind rivals during a widespread selloff. Nvidia also fell, slipping 4.38%, according to MarketWatch data. 7
Investors are still digesting last month’s margin update. Broadcom warned gross margin for the current quarter will drop roughly 100 basis points — remember, one basis point equals 0.01 percentage point. The decline is mainly due to a bigger slice of revenue coming from AI products, which typically have lower margins, Reuters reported. 8
Bulls face a risk if a slowdown in enterprise spending coincides with renewed tariff uncertainties, pushing clients to postpone projects and putting pressure on chip and software valuations. The biggest impact would come if AI demand slips from “must-have” to “nice-to-have.”
Markets are set to watch closely for any fresh tariff cues as February 1 approaches, while also gearing up for Broadcom’s upcoming earnings report, slated for after the close on March 4, according to the company’s current plan. 9
