Broadcom Expected to Report Strong Q1 2026 Results
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy AVGO?
Source: Benzinga
- Strong Earnings Outlook: Broadcom is expected to report over $9 billion in AI revenues for Q1 2026, significantly exceeding the consensus estimate of $8.1 billion, driven by sustained demand for Google's TPU 3nm chip and robust networking chip performance.
- Quarterly Revenue Guidance: The company may raise its revenue guidance for the April quarter to between $21 billion and $22 billion, surpassing the consensus expectation of $20.5 billion, indicating continued strength in AI demand.
- Long-Term Growth Potential: Broadcom anticipates AI revenues exceeding $65 billion in fiscal 2026 and crossing $120 billion in fiscal 2027, highlighting the company's strong growth potential driven by new products and programs.
- Strong Supply Chain Demand: Analysts noted that Broadcom is experiencing TPU demand that exceeds its supply chain capabilities, with efforts underway to unlock more supply in the coming months to meet the growing market demand.
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Analyst Views on AVGO
Wall Street analysts forecast AVGO stock price to rise
30 Analyst Rating
29 Buy
1 Hold
0 Sell
Strong Buy
Current: 318.820
Low
370.00
Averages
457.75
High
525.00
Current: 318.820
Low
370.00
Averages
457.75
High
525.00
About AVGO
Broadcom Inc. is a global technology firm that designs, develops, and supplies a range of semiconductors, enterprise software and security solutions. The Company operates through two segments: semiconductor solutions and infrastructure software. Its semiconductor solutions segment includes all of its product lines and intellectual property (IP) licensing. It provides a variety of radio frequency semiconductor devices, wireless connectivity solutions, custom touch controllers, and inductive charging solutions for mobile applications. Its infrastructure software segment includes its private and hybrid cloud, application development and delivery, software-defined edge, application networking and security, mainframe, distributed and cybersecurity solutions, and its FC SAN business. It provides a portfolio of software solutions that enable customers to plan, develop, automate, manage and secure applications across mainframe, distributed, mobile and cloud platforms.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Broadcom's Growth Outlook for 2026 Looks Promising
- Strong Earnings Outlook: Broadcom anticipates fiscal Q1 2026 revenue of $19.1 billion, representing a 28% increase year-over-year, indicating significant overall revenue growth amid accelerating sales of AI-related products.
- Substantial Backlog: As of the end of fiscal 2025, Broadcom's backlog reached $162 billion, with $73 billion allocated for AI chips, expected to be cleared over the next six quarters, providing a stable revenue stream for the company.
- Market Confidence Rebounds: Despite a 10% drop in stock price at the start of 2026, Wall Street projects Broadcom's fiscal 2026 revenue to be $97.6 billion, a 53% increase from last year, reflecting strong market confidence in its future growth.
- Optimistic Analyst Ratings: Currently, 96% of the 55 analysts covering Broadcom rate it as a buy, indicating a positive outlook on its future performance, suggesting that investors considering buying during the current dip may see favorable returns.
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HSBC Maintains Buy Rating on Broadcom, Lowers Price Target
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- Revenue Forecast: Analysts predict Broadcom's revenue for Q2 FY26 will reach $21 billion, exceeding the consensus estimate of $20.3 billion, suggesting strong market performance driven by AI growth momentum.
- Price Target Adjustment: HSBC lowered Broadcom's price target from $535 to $450, reflecting a valuation reset for AI-focused companies, even as the rapid expansion in AI networking remains underestimated.
- AI Networking Outlook: Broadcom's $20 billion AI networking backlog highlights market potential, with analysts projecting FY26 and FY27 AI networking revenues of $17 billion and $30 billion, respectively, which are 43% and 64% above market expectations.
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Broadcom Shares Decline but Outlook Remains Positive
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- Strong Financial Outlook: The company anticipates fiscal Q1 2026 revenue of $19.1 billion, a potential 28% increase year-over-year, supported by a substantial backlog of $162 billion at the end of fiscal 2025, with $73 billion specifically for AI chips, indicating robust market demand.
- Earnings Growth Potential: Analysts project Broadcom's revenue for fiscal 2026 to reach $97.6 billion, a 53% increase from last year, compared to a 24% growth in fiscal 2025, suggesting the company's growth rate is poised to more than double this fiscal year, surpassing the average 14% earnings growth of S&P 500 companies.
- Investment Attractiveness: Trading at 32 times forward earnings, Broadcom's valuation exceeds the S&P 500's 22 times, yet is justified by expected strong earnings growth, with a median 12-month price target of $458 indicating a potential 43% upside from current levels, making it an attractive buy according to 96% of analysts covering the stock.
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Broadcom's Growth Outlook for 2026 Looks Promising
- Strong Earnings Outlook: Broadcom anticipates fiscal Q1 2026 revenue of $19.1 billion, representing a 28% increase year-over-year, indicating significant overall revenue growth amid accelerating sales of AI-related products.
- Substantial Backlog: As of the end of fiscal 2025, Broadcom's backlog reached $162 billion, with $73 billion allocated for AI chips, expected to be cleared over the next six quarters, providing a stable revenue stream for the company.
- Market Confidence Rebounds: Despite a 10% drop in stock price at the start of 2026, Wall Street projects Broadcom's fiscal 2026 revenue to be $97.6 billion, a 53% increase from last year, reflecting strong market confidence in its future growth.
- Optimistic Analyst Ratings: Currently, 96% of the 55 analysts covering Broadcom rate it as a buy, indicating a positive outlook on its future performance, suggesting that investors considering buying during the current dip may see favorable returns.
See More
Analysis & Outlook: A Reality Assessment
- Market Reaction: Stocks opened significantly lower, indicating a shift away from the previous "ignore geopolitics" mindset.
- Recovery Trend: By late morning, there was a noticeable recovery in stock prices, suggesting some stabilization in the market.
See More
This Schwab Dividend ETF Shines Bright, with Defense and Energy as Key Sectors.
- Investor Expectations: Investors in the Schwab U.S. Dividend Equity ETF are not anticipating significant growth this year.
- Current Performance: Despite low expectations, the ETF is experiencing notable performance this year.
See More
HSBC Maintains Buy Rating on Broadcom, Lowers Price Target
- Earnings Expectations: Broadcom is expected to report revenue of $9.5 billion in its fiscal Q1 2026 results on March 4, slightly above management's guidance of $9.1 billion, indicating stable growth in the software and semiconductor sectors.
- Revenue Forecast: Analysts predict Broadcom's revenue for Q2 FY26 will reach $21 billion, exceeding the consensus estimate of $20.3 billion, suggesting strong market performance driven by AI growth momentum.
- Price Target Adjustment: HSBC lowered Broadcom's price target from $535 to $450, reflecting a valuation reset for AI-focused companies, even as the rapid expansion in AI networking remains underestimated.
- AI Networking Outlook: Broadcom's $20 billion AI networking backlog highlights market potential, with analysts projecting FY26 and FY27 AI networking revenues of $17 billion and $30 billion, respectively, which are 43% and 64% above market expectations.
See More
Broadcom Shares Decline but Outlook Remains Positive
- Stock Performance Decline: Broadcom (AVGO) shares have dropped 10% at the start of 2026, significantly underperforming the 10% rise in the semiconductor sector index, reflecting negative sentiment surrounding AI stocks and concerns about the viability of massive spending on AI data centers.
- Strong Financial Outlook: The company anticipates fiscal Q1 2026 revenue of $19.1 billion, a potential 28% increase year-over-year, supported by a substantial backlog of $162 billion at the end of fiscal 2025, with $73 billion specifically for AI chips, indicating robust market demand.
- Earnings Growth Potential: Analysts project Broadcom's revenue for fiscal 2026 to reach $97.6 billion, a 53% increase from last year, compared to a 24% growth in fiscal 2025, suggesting the company's growth rate is poised to more than double this fiscal year, surpassing the average 14% earnings growth of S&P 500 companies.
- Investment Attractiveness: Trading at 32 times forward earnings, Broadcom's valuation exceeds the S&P 500's 22 times, yet is justified by expected strong earnings growth, with a median 12-month price target of $458 indicating a potential 43% upside from current levels, making it an attractive buy according to 96% of analysts covering the stock.
See More
Apple Launches New MacBook Pro and Air Models with M5 Chips
- Product Refresh: Apple has launched new MacBook Pro and MacBook Air models featuring the latest M5 chips, aiming to revive Mac demand amid a nearly 7% sales drop to $8.39 billion during the holiday quarter, significantly below analyst expectations of $9 billion.
- Price Adjustments: The new MacBook Air starts at $1,099 for the 13-inch model and $1,299 for the 15-inch model, with base storage doubled to 512GB, while the MacBook Pro starts at $2,199 for the 14-inch model and $3,899 for the 16-inch model, reflecting a $400 increase from previous versions.
- Performance Boost: The new MacBook Pro is positioned to process large language model prompts nearly four times faster than M4-based machines and up to eight times faster than M1 models, all while maintaining battery life, which is crucial for businesses wanting to keep sensitive data off cloud servers.
- Display Update: Apple has revamped its Studio Display lineup, with the base model starting at $1,599 and the higher-end Studio Display XDR at $3,299, adding features like higher brightness and faster refresh rates aimed at professional users, indicating Apple's ongoing focus on the premium market.
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