New York, February 5, 2026, 11:01 ET — Regular session
- Shares of Broadcom climbed Thursday, building on gains from earlier premarket trading.
- Chip stocks linked to AI data centers jumped after Alphabet unveiled its 2026 spending plan.
- Broadcom’s next big event is its quarterly report, set for after the close on March 4.
Shares of Broadcom Inc climbed roughly 2.8% to $316.53 in late morning trading Thursday, following a close at $308.05 the day before. The stock hit a peak of $326.44 earlier but pulled back afterward.
This matters since markets see Big Tech’s budget chatter as the quickest signal for AI hardware demand. Chip suppliers have been reacting to capex news, despite some cracks showing in the broader tech rally.
Alphabet, the parent company of Google, plans to ramp up its capital expenditure to between $175 billion and $185 billion in 2026. This marks a steep increase from the $91.45 billion projected for 2025 and significantly exceeds analysts’ estimates of about $115 billion, according to LSEG data. CEO Sundar Pichai told analysts, “We are seeing our AI investments and infrastructure drive revenue and growth across the board.” (Reuters)
Broadcom sits deep in the supply chain, partnering with Google on Tensor Processing Units (TPUs), the tech giant’s own AI chips. BofA Securities estimates that Google’s TPU project makes up over 80% of Broadcom’s AI compute sales. Analysts, however, note MediaTek is emerging as a competitor as customers look to spread their supply risks. (Barron’s)
Broadcom climbed roughly 4.5% in premarket action but pared gains as nerves around the broader AI sector lingered. Thomas Monteiro, senior analyst at Investing.com, noted, “Unforgiving scrutiny over AI capex continues to spook investors.” (Kitco)
Broadcom’s immediate challenge is seeing if larger budgets actually boost orders for custom silicon and networking components, beyond just the top-line figures.
Here’s the downside: ramping up custom AI chips tends to squeeze margins. Broadcom flagged this risk back in December, noting a heavier share of lower-margin custom processors might weigh on profits. CFO Kirsten Spears mentioned gross margin could slip by “about 100 basis points” quarter-on-quarter; one basis point equals 0.01 percentage point. (Reuters)
Broadcom will release its fiscal first-quarter results after the market closes on March 4, followed by a conference call at 5 p.m. ET. Investors are eager for insights on AI chip demand, networking unit shipments, and any signs of margin stabilization. (Nasdaq)
