NEW YORK, Jan 4, 2026, 16:44 ET — Market closed
- Broadcom ended Friday up 0.44% as chip stocks opened 2026 on a firm note.
- Investors are balancing AI-driven demand with margin pressure flagged last quarter.
- Next checkpoints include U.S. data this week and Broadcom’s March earnings report.
Broadcom Inc (AVGO.O) shares rose 0.44% on Friday to close at $347.62, giving the chip-and-software maker a modest lift after markets reopened for the first session of 2026. Broadcom’s shares have traded between a 52-week low of $138.10 and a high of $414.61. 1
The move matters because Broadcom sits in two parts of the tech cycle that investors are repricing: custom AI chips and enterprise infrastructure software. Its custom processors — often called ASICs, or application-specific integrated circuits — are designed for one workload and are used by big cloud customers building their own AI systems.
It also matters because early January trading can amplify positioning shifts, with macro data and rates setting the tone for growth-stock valuations. For Broadcom, the next few weeks are a test of whether AI demand stays strong without further squeezing profitability.
In Friday’s session, Broadcom lagged bigger gains in some semiconductor names. Applied Materials rose 4.62% and Advanced Micro Devices jumped 4.35%, while the S&P 500 finished up 0.19% and the Dow gained 0.66%, MarketWatch data showed. 2
Broadcom also used the start of the year to underline its VMware channel strategy. In a company blog post on Friday, a Broadcom executive said customers in Europe, the Middle East and Africa are rethinking cloud spending and “standardizing on VMware Cloud Foundation” — the platform VMware sells for running private and hybrid clouds. 3
The bigger investor focus remains the company’s last set of targets and the trade-offs inside them. Broadcom forecast first-quarter fiscal 2026 revenue of about $19.1 billion and adjusted EBITDA of 67% of revenue, a measure investors often use as a proxy for operating profitability. It also warned that AI mix can pinch margins: CFO Kirsten Spears said, “We expect first-quarter consolidated gross margin to be down approximately 100 basis points sequentially,” with a basis point equal to one-hundredth of a percentage point. 4
Technically, Broadcom enters Monday’s open below key trend levels that traders track. Shares remain about 3.9% under the 50-day moving average near $361.80 — a widely used gauge of the stock’s recent direction — even after Friday’s close. 5
But the downside case is clear: if hyperscalers tighten AI infrastructure budgets or demand shifts toward lower-margin systems, Broadcom’s revenue can still grow while profit per dollar of sales slips. Investors are also watching whether VMware-related pricing and renewals stay steady as customers push back on software bills.
Macro catalysts are close. The ISM releases its manufacturing PMI on Jan. 5 and its services PMI on Jan. 7, while the U.S. Employment Situation report for December is scheduled for Jan. 9 — data that can swing interest-rate expectations and the multiples investors pay for chip stocks. 6
The next company-specific catalyst is Broadcom’s fiscal first-quarter report, which it plans to release after the close on Wednesday, March 4, followed by an earnings call webcast, according to a transcript of its last earnings call.
