Broadcom: AI guidance gap reveals the cost of sky-high expectations
Key takeaways
- The company reported second-quarter revenue of $22.2 billion, slightly ahead of guidance, with AI revenue of $10.8 billion surpassing its own forecast by $100 million.
- The stock s decline reflected investor frustration that Broadcom did not raise guidance despite strong order momentum, with analysts pointing to supply constraints rather than demand weakness as the limiting factor.
- Bank of America framed the guidance reiteration as conservatism.
Broadcom: AI guidance gap reveals the cost of sky-high expectations Proactive Thu, June 4, 2026 at 10:21 PM GMT+7 4 min read AVGO Shares of Broadcom Inc (NASDAQ:AVGO, XETRA:1YD) fell more than 14% on Thursday after the chipmaker s fiscal third-quarter AI revenue guidance and its reiteration of a full-year 2027 target fell short of investor expectations, overshadowing strong second-quarter results.
Broadcom guided for AI revenue of $16 billion in the third quarter, below analyst estimates of around $17.3 billion, and reiterated its fiscal 2027 AI revenue target of more than $100 billion, a figure analysts said the market had already priced in at a considerably higher level.
The company reported second-quarter revenue of $22.2 billion, slightly ahead of guidance, with AI revenue of $10.8 billion surpassing its own forecast by $100 million. Earnings per share came in at $2.44, ahead of Wall Street estimates.