New York, January 14, 2026, 16:09 EST — After-hours
- Broadcom shares dropped following reports that China has instructed local companies to halt the use of foreign cybersecurity software, including VMware, which Broadcom owns.
- The stock fell amid a wider tech-driven selloff on Wall Street.
- Broadcom priced $4.5 billion in senior notes, according to a new SEC filing that also detailed upcoming debt redemptions.
Shares of Broadcom Inc dropped Wednesday following a Reuters report that Chinese regulators have ordered local companies to halt use of cybersecurity software from over a dozen U.S. and Israeli firms, including VMware, which Broadcom owns, over national security worries. (Reuters)
The headline hurts, given VMware’s key role in Broadcom’s argument that it can combine chip growth with reliable infrastructure-software revenue. It lands at a moment when the market has begun to view China policy risk as a tradable factor again, not just a side note.
Broadcom slid 4.2% to $339.55 in late U.S. trading, hitting a low of $334.53 along the way. The stock had ended Tuesday at $354.61.
The sell-off hit as U.S. stocks dropped across the board, tech shares dragging the Nasdaq down roughly 1.4% by the closing bell. Michael O’Rourke, chief market strategist at JonesTrading, noted investors are pulling back from “expensive megacaps” and shifting toward safer, defensive sectors. (Reuters)
Broadcom’s concern isn’t just a single lost contract. It’s the ripple effect—procurement freezes, postponed renewals, and more challenging sales ahead when regulators step in. These issues tend to hit bookings and renewals first, before they impact revenue.
Separately, Broadcom disclosed in a filing that it has issued $4.5 billion in senior notes spanning four maturities. The company plans to funnel the proceeds toward general corporate uses and paying down debt. It also announced plans to redeem multiple existing note series soon, including those tied to its VMware unit. (SEC)
Moves like this in the debt market are usually just routine housekeeping. But it does shine a light on the capital structure, especially now, when investors are wary of surprises from companies that have been relying on major deals to reshape their business mix.
Modeling the China report in real time is trickier. How broad the directive is, how fast Chinese clients might pivot, and if it extends beyond cybersecurity tools could all shift the fallout — ranging from a brief scare to a real hit on software growth forecasts.
Sentiment spillover poses another threat. Traders might continue to view Broadcom as a stand-in for U.S.-China tech tensions and the broader valuation questions surrounding mega-cap tech, even if its revenue exposure turns out to be minimal.
Investors are waiting to see how companies respond and how widely the China directive will impact them. The next major event to watch is Broadcom’s quarterly earnings report, due around March 5, per Nasdaq’s earnings calendar. (Nasdaq)
