PALO ALTO, California, September 3, 2026, 14:03 (PDT) — Broadcom shares (AVGO.O) slipped 2.7% as the company’s latest results reported a 0.7% shortfall in sales, putting its AI-related valuation under scrutiny.
- Broadcom ended the session at $357.16, declining 2.74%, having reached a low of $342.33.
- Revenue for the fiscal third quarter increased by 86% to $29.591 billion, with AI chip sales totaling $16.7 billion.
- Fourth-quarter revenue guidance came in at $34.8 billion, falling short of the $35.03 billion LSEG consensus by 0.66%.
Shares of Broadcom Inc. NASDAQ:AVGO ended Thursday down 2.7%. The decline wiped out about $48 billion in market value after the company’s outlook fell $230 million short of expectations Yahoo Finance; Reuters.
The 0.66% forecasting gap prompted a sharp valuation test. Investors dismissed robust AI growth as Broadcom’s earnings expectations stay exceptionally high.
The company surpassed forecasts for the quarter, posting revenue of $29.591 billion and adjusted earnings of $3.32 per share Broadcom results.
Broadcom’s regular-session path
USD per share; selected five-minute observations
Broadcom’s shares moved within a range of $342.33 to $359.40. Trading volume stood at 59.9 million shares, approximately 2.38 times the stock’s three-month daily average.
The response varied between companies. NVIDIA Corporation NASDAQ:NVDA rose 1.8%, and Marvell Technology, Inc. NASDAQ:MRVL climbed 1.1% Yahoo Most Active.
Chief Executive Hock Tan stated that there was “very strong” demand for custom accelerators and networking. Revenue from AI semiconductors increased 221% to $16.7 billion.
The beat, then the guidance gap
AI accounted for 56.4% of overall sales. According to Broadcom’s stated numbers, it was also responsible for an estimated 98.5% of growth in the semiconductor sector.
Non-AI semiconductor revenue reached around $4.14 billion, representing just a 4.4% increase compared to the estimated figure from a year earlier.
Broadcom’s $29.591 billion revenue mix
Fiscal third quarter 2026
Cash conversion stayed robust. Free cash flow totaled $13.665 billion, representing 46.2% of revenue.
Broadcom closed the quarter holding $24.0 billion in cash. The company forecast a 66% adjusted operating margin for this quarter.
Executives project AI revenue to reach about $115 billion in fiscal 2027. For fiscal 2028, the target stands at $230 billion, suggesting revenue could double again Reuters.
Analysts continue to favour a bullish outlook. The consensus price target averaged $530.52 across 49 estimates, but the spread between projections stayed notably broad MarketScreener.
Analyst targets span a $499 range
USD per share; 49 analysts
Jefferies analyst Blayne Curtis described Broadcom as a “long-term winner.” He added that there is “less discovery value” anticipated in the upcoming eight quarters Kiplinger.
Risks include dependence on a limited customer base, potential supply issues, and competing custom-chip initiatives that may hold back AI sales. There is also a possibility of softer software demand or declining margins.
The next step is execution. Broadcom forecasts AI semiconductor revenue of $21.7 billion in the fourth quarter, representing 62.4% of projected sales.
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