Broadcom revenue hits record $22.19B but shares fall 5.5% on AI guidance

Broadcom reported Q2 revenue of $22.19 billion, up 48% year over year, beating the $22.13 billion consensus estimate by $60 million.

"The quarter was driven by surging demand for our custom AI accelerators," the company said in its earnings release. Broadcom did not provide a direct CEO quote in the release.

The semiconductor and software company posted adjusted earnings per share of $2.05, up 28% from a year earlier, matching analyst expectations. AI solutions revenue more than doubled, growing 106% year over year, as hyperscaler customers expanded deployments of custom chips.

Metric	Actual	Consensus	Beat/Miss
Revenue	$22.19B	$22.13B	+0.3%
EPS	$2.05	$2.05	In line
AI Solutions Rev.	Not disclosed	—	+106% YoY

Shares fell 5.5% in extended trading after the report, reversing a 4.9% gain during the regular session that had pushed the stock to a record close of $482.28. The decline came as the company's third-quarter AI semiconductor guidance disappointed relative to elevated investor expectations, despite overall revenue guidance that topped Wall Street forecasts. Broadcom guided for Q3 revenue of roughly $22.7 billion, above the $22.5 billion consensus, but the AI chip segment outlook failed to meet the most bullish projections.

The after-hours selloff signals that investors had priced in an even stronger AI chip trajectory after Broadcom shares surged more than 700% since early 2023. The company's partnership with Alphabet on Google's Tensor Processing Units and its broader custom chip business remain key growth drivers, with Alphabet recently announcing an $80 billion capital raise to expand AI infrastructure. Investors will watch the Q2 earnings call on Thursday for updated segment-level margin details and the pace of custom chip deployments through the second half of the fiscal year.

This article is for informational purposes only and does not constitute investment advice.