Broadcom Inc. · AVGO · FY2026 Q2 · Calendar Q2 2026

Broadcom Q2 FY26: AI Chip Revenue Hits $10.8B but Stock Sinks 13%

Broadcom delivered record Q2 FY26 revenue of $22.2B with AI semiconductor sales surging 143% YoY to $10.8B, now nearly half of total revenue. Free cash flow hit a record $10.3B and operating margin held at ~67%. Despite beating both EPS and revenue estimates, shares fell roughly 13%, with continued downward drift of ~11% in subsequent sessions. The sell-off appears tied to gross-margin compression from the AI-mix shift, customer concentration risk, and elevated inventory levels. Management struck a confident tone, backed by $30B in AI bookings and a new $35B AI XPU platform, but the market remains skeptical on execution risk at scale.

Reported After market closeNASDAQTechnology $1823.20B market cap
90quality score

Company context

Snapshot as of publication

Broadcom Inc. is a prominent global technology enterprise focused on the innovation, development, and supply of advanced semiconductor solutions and critical infrastructure software. The company's headquarters are situated in San Jose, California, and it maintains a significant team of 19,000 full-time staff. Its operations are segmented into four primary divisions: Wired Infrastructure, Wireless Communications, Enterprise Storage, and Industrial & Other.…

Earnings scorecard

Reported versus consensus
Reported EPS $2.44 Consensus $2
EPS surprise +1.7% Reported versus consensus
Reported revenue $22.19B Consensus $22.13B
Revenue surprise +0.3% Reported versus consensus

Earnings History

Estimate Beat Miss Match
AVGO REVENUE earnings history estimate and actual scatter chart 9 reported fiscal quarters and 4 future estimate-only quarters. Q1 '24 estimate $12B Q1 '24 actual $12B, beat Q2 '24 estimate $12B Q2 '24 actual $12B, beat Q3 '24 estimate $13B Q3 '24 actual $13B, beat Q2 '25 estimate $15B Q2 '25 actual $15B, beat Q3 '25 estimate $16B Q3 '25 actual $16B, beat Q4 '25 estimate $17B Q4 '25 actual $18B, beat Q1 '26 estimate $19B Q1 '26 actual $19B, beat Q2 '26 estimate $22B Q2 '26 actual $22B, beat Q3 '26 estimate $29B Q4 '26 estimate $35B Q1 '27 estimate $37B Q2 '27 estimate $41B
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Analyst Consensus ?

ConsensusBuy57 ratings
Bullish4986.0%
Neutral814.0%
Bearish00.0%

Analyst 52W Price Targets

$383.22Previous close
$61.5Low
$333.46Average
$582High

Latest persisted target per named analyst; persisted previous close from FN2's market snapshot as of Jul 28, 2026. Not an FN2 forecast.

Firm-level rating actions

FMP grade actions identify the grading firm, not a named analyst.

FirmRatingPrior ratingActionDate
Erste Group Hold BuyDowngradeJul 7, 2026
UBS Buy BuyMaintainJun 4, 2026
Truist Securities Buy BuyMaintainJun 4, 2026
TD Cowen Buy BuyMaintainJun 4, 2026
Rosenblatt Buy BuyMaintainJun 4, 2026
RBC Capital Sector Perform Sector PerformMaintainJun 4, 2026
Oppenheimer Outperform OutperformMaintainJun 4, 2026
Morgan Stanley Overweight OverweightMaintainJun 4, 2026
Show 49 more rating actions

Named analyst price targets

Upside is calculated against the persisted previous close $383.22. FMP does not supply a rating on these named-analyst rows.

FirmAnalyst52W targetPrice when postedUpsideDate
D.A. DavidsonAnalyst unavailable$400$410.33 +4.4%Jun 4, 2026
Truist FinancialWilliam Stein$550$407.11 +43.5%Jun 4, 2026
Goldman SachsAnalyst unavailable$525$407.07 +37.0%Jun 4, 2026
RBC CapitalSrini Pajjuri$400$406.45 +4.4%Jun 4, 2026
OppenheimerAnalyst unavailable$535$479.23 +39.6%Jun 4, 2026
Morgan StanleyAnalyst unavailable$502$479.23 +31.0%Jun 4, 2026
KeyBancJohn Vinh$575$479.23 +50.0%Jun 4, 2026
UBSAnalyst unavailable$485$479.23 +26.6%Jun 4, 2026
MacquarieAnalyst unavailable$437$479.23 +14.0%Jun 4, 2026
Deutsche BankRoss Seymore$515$479.23 +34.4%Jun 4, 2026
See 125 more

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Market reaction

event-close to next-session close
Stock move -12.6% Event window
SPY move +0.4% Same window
Abnormal move -13.0% Stock minus SPY
Volume 3.5× Versus trailing sessions
Subsequent drift -10.7% Up to 20 sessions
AVGOSPY benchmark

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Transcript intelligence

What changed

Revenue reached $22.2B (est. $22.1B) and EPS came in at $2.44 (est. $2.40). AI semiconductor revenue jumped 143% YoY to $10.8B, representing 49% of total revenue. Operating margin remained robust at ~67%. Free cash flow set a record at $10.3B. Infrastructure software grew 9% YoY on VMware Cloud Foundation 9.1. AI bookings reached $30B, far exceeding shipped revenue. The company launched a $35B AI XPU platform funded by Apollo and Blackstone. Inventory days rose to 86, reflecting supply-chain positioning for AI demand. Despite the beat, the stock fell 12.6% with abnormal move of -13.0% and subsequent drift of -10.7%.

Guidance delta

Guidance maintained. Management expects AI semiconductor revenue to double in H2 FY26 and exceed $100B in FY27. Q3 AI semiconductor shipments targeted at $16B; full-year FY26 AI semiconductor revenue targeted at $56B. Capex outlook stable.

Key takeaways

  • AI semiconductor revenue reached $10.8B, 49% of total revenue, up 143% YoY
  • Operating margin held robust at ~67% despite mix-related gross-margin pressure
  • Guidance calls for AI semiconductor revenue to double in H2 FY26 and exceed $100B in FY27
  • Infrastructure software grew 9% YoY, led by VMware Cloud Foundation 9.1
  • $30B in AI bookings provide revenue visibility through 2028

Management priorities

  • Scaling AI semiconductor shipments to $16B in Q3 and $56B for FY26
  • Rolling out next-generation 200-terabit Ethernet switch
  • Commercial launch of the AI XPU platform with Apollo and Blackstone funding
  • Continued VCF 9.1 enhancements for heterogeneous compute support
  • Expanding gigawatt-scale compute deployments through 2027-2028

Related earnings events

Technology

Sources

  1. Earnings call transcript and parsed analysis · 2026-06-04T04:18:21.389427+00:00
  2. FN2 earnings calendar · 2026-07-26T00:37:12.209961+00:00
  3. Polygon adjusted daily market bars · 2026-07-28T05:01:55.680977+00:00
  4. Financial Modeling Prep analyst price-target consensus and quote snapshot · 2026-07-28T05:01:55.678233+00:00

Methodology

Reported and consensus figures come from FN2's earnings event records. Market reaction and volume are calculated from daily adjusted bars around the event; abnormal move subtracts the SPY move over the same window.

Analyst target low, average, and high values are derived at request time from each named analyst's latest persisted FMP target. The current-price marker comes from FN2's persisted market snapshot. They are sell-side estimates, not an FN2 valuation or recommendation.

Transcript intelligence is a structured synthesis of the current and prior earnings-call analyses. Missing values stay missing and are never estimated.

By FN2 Research · Updated . For educational purposes only; not investment advice.