New York, Jan 24, 2026, 18:27 ET — The market has closed.
- Broadcom shares dipped 1.7%, ending the day at $320.05.
- Fidelity said it has settled a lawsuit over access to VMware software, which Broadcom now owns.
- Traders are focused on next week’s Fed decisions and key tech earnings to gauge chip stock valuations.
Shares of Broadcom Inc. fell 1.7% on Friday, ending the day at $320.05. The drop came after Fidelity Investments settled a lawsuit over access to VMware software, which it called vital to its business. Fidelity said Broadcom agreed to keep providing services and software to its unit, sidestepping a court hearing set for next week. “Broadcom’s services to Fidelity will continue uninterrupted,” a Fidelity spokesperson said. Reuters
Why it matters now: this case throws a spotlight on Broadcom’s VMware play just as fresh market-moving factors come into view. Broadcom has leaned more on infrastructure software to smooth out chip cycle ups and downs, yet key customers still keep a close eye on pricing changes and contract terms.
Semiconductors stumbled right as earnings season gets underway. Intel’s steep fall following a weak forecast set a negative tone heading into the weekend. Investors are now bracing for key tech earnings that could shift views on AI spending. Julian McManus, portfolio manager at Janus Henderson, called it a “show-me” moment—companies must “put up the revenue growth” after stocks surged recently. Reuters
Fidelity’s lawsuit states it has depended on VMware “virtualization” software since 2005—technology enabling several virtual servers to operate on one physical machine—and warned that losing access could trigger outages and disrupt trading. The firm also accused Broadcom of repackaging VMware products into more expensive bundles, forcing Fidelity to buy these bundles upon subscription renewal. Broadcom did not immediately respond to a request for comment, Reuters reported.
Broadcom’s market cap hovered around $1.5 trillion following Friday’s session, below its 52-week high of $414.61, per the company’s investor documents.
With Monday’s open nearing, traders are zeroing in on whether the Fidelity settlement will ease worries over VMware’s licensing tweaks or instead spotlight the risk that other big clients could push back against Broadcom—either in court or at the negotiating table.
There’s a risk on the downside, too. The settlement removes a big legal uncertainty but leaves open how far Broadcom will push bundling and price hikes before customers push back, switch suppliers, or file fresh disputes. If wider churn takes hold, it could pressure a market already quick to punish richly valued tech names.
Broadcom often serves as a proxy for data-center demand, given its networking silicon and custom chips tied to big computing initiatives. Investors are bracing for next week’s megacap tech earnings, looking for hints on capex — the spending that drives orders for servers, networking gear, and associated silicon.
The macro calendar is still full. The Federal Reserve’s policy meeting on Jan. 27–28 stands out as a key event for rate-sensitive growth stocks after a turbulent week in U.S. markets.
Up next: Monday’s reaction to the Fidelity settlement, then the Fed’s January 28 decision. Later that week, big-tech earnings will drop, offering a crucial read on AI investment and chip demand.
