New York, Feb 5, 2026, 04:48 EST — Premarket
- Broadcom dropped 3.9% on Wednesday amid a sharp selloff in chip stocks.
- Jefferies stuck with its Buy rating, highlighting Google’s spending plans as a clear sign of demand.
- Broadcom this week unveiled an enterprise Wi‑Fi 8 platform designed for “AI-ready” networks.
Shares of Broadcom Inc. head into Thursday’s U.S. session having fallen sharply, as investors digest new AI-related spending cues from Alphabet amid growing jitters over tech valuations.
The stock ended Wednesday at $308.05, slipping 3.9% from the previous day’s finish, with intraday lows hitting $295.30.
Broadcom slid alongside the wider semiconductor sector as Wall Street backed off AI-driven stocks, pushing the Nasdaq down 1.5% and the Philadelphia SE Semiconductor index down 4.4%. “The stock market is having a really hard knowing where to price the stocks and what the future looks like,” said Jed Ellerbroek, a portfolio manager at Argent Capital in St. Louis. Reuters
Timing is key as major cloud customers increasingly discuss boosting capital expenditures. Traders are scrambling to gauge how quickly this will translate into orders for chips, networking equipment, and other parts of the data center supply chain.
Jefferies stuck with its Buy rating and $500 price target early Thursday, describing Google’s latest capital spending guidance as a “significant vote of confidence” for AI investment. The firm highlighted Broadcom’s strong position in custom AI chips—application-specific integrated circuits, or ASICs—and noted robust demand for networking equipment linked to data centers. Investing.com
Broadcom highlighted strong product momentum beyond data centers. On Feb. 3, the company rolled out what it called the industry’s first enterprise Wi‑Fi 8 access point and switch platform designed for “AI-ready” networks. Executive Mark Gonikberg emphasized that as AI penetrates operations, enterprises require a “robust, intelligent, and secure” network. markets.businessinsider.com
Alphabet announced Wednesday it might boost its 2026 capital expenditures to between $175 billion and $185 billion, nearly doubling previous estimates. The increase targets AI and cloud infrastructure expansion. Some investors view this as a positive sign for major suppliers, though concerns about returns on these investments have resurfaced.
The downside is clear: the market continues to slash the value of “AI certainty.” Should cloud budgets arrive slower than anticipated, or if investors judge the spending is outpacing returns, Broadcom could keep trading more like a high-beta AI play than a reliable cash machine.
Broadcom is set to release its first-quarter fiscal 2026 earnings on March 4, after markets close, followed by a conference call at 5 p.m. ET. Investors will focus on the latest trends in AI-chip demand, data center networking, and how fast its software segment is growing.
