:max_bytes(150000):strip_icc()/GettyImages-969249136-ee2a07ab069c43c6bd3738e4a764487e.jpg "Broadcom Turned In Strong Earnings. But Will They Revive the AI Trade?")
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Key Takeaways
- Broadcom posted better-than-expected earnings on AI demand, and said it sees that momentum continuing in the current quarter.
- The results didn’t immediately revive confidence in the AI trade after Thursday’s sell-off in the wake of Oracle’s earnings.
The AI trade has sputtered lately. Investors looking for Broadcom’s latest quarterly results to get it running again have been disappointed so far.
Shares of chipmaker Broadcom (AVGO) first jumped in extended trading Thursday, rising after it posted results that topped analysts’ estimates on growing AI demand. That was welcome for bullish investors who saw the Nasdaq and many of the Dow’s tech-focused components left out of today’s market surge.
Not long after, however, they were in the red again, extending losses from the regular session—and suggesting that the latest tech selloff, led by database giant Oracle (ORCL) after it failed to impress investors with its own results, might not be done.
Why This Matters to Investors
Oracle’s drop Thursday amid worries about its debt load and circular deals rattled confidence in the AI trade, weighing on the tech sector. Investors may have hoped that Broadcom’s better-than-expected results could point to a stronger case for some AI-exposed stocks, but the short-term reaction to its numbers was hardly an endorsement.
Oracle slightly missed Street sales estimates. But Broadcom topped forecasts with a 28% year-over-year jump in quarterly revenue to a record $18.02 billion. It also posted adjusted earnings per share of $1.95 for the fiscal fourth quarter, above the $1.88 analysts surveyed by Visible Alpha were looking for.
CEO Hock Tan said the supplier for Meta (Meta) and Alphabet’s (GOOGL) Google sees that momentum continuing in the current quarter, and projected first-quarter revenue of $19.1 billion, ahead of analysts’ estimates.
Broadcom also said its board approved a 10% boost in its quarterly dividend to $0.65 for fiscal 2026, marking its 15th straight year of increases in its annual payout.
Shares of Broadcom have added about three-quarters of their value in 2025 as of Thursday’s close.
