TLDR
- Broadcom will release its fiscal first-quarter earnings results after the market closes on Wednesday, March 4
- Analysts project earnings per share (EPS) of $2.03 and revenue of $19.26 billion, marking increases from $1.60 and $14.92 billion in the same period last year
- AI networking revenue projections have been significantly upwardly revised — HSBC now forecasts $17 billion for FY26 and $30 billion for FY27
- HSBC maintained its Buy rating but cut its price target from $535 to $450, citing an AI valuation reset
- Investor sentiment is cautious after Nvidia dropped 5.5% post-earnings despite beating estimates
Broadcom is approaching its fiscal first-quarter earnings announcement on Wednesday with robust analyst expectations, yet investors are remaining vigilant for potential market reactions.
The chip and software firm is anticipated to report adjusted earnings of $2.03 per share and revenue of $19.26 billion. This represents a year-over-year increase from $1.60 per share and $14.92 billion in the same quarter of the previous year — strong growth regardless of the metric used.
The semiconductor solutions division is driving most of the growth, with projected revenue of $12.4 billion — a 51% surge from the prior year. Infrastructure software is forecast to generate $6.99 billion, an increase of approximately 4.3%
Broadcom’s AI networking business has emerged as a critical growth driver. The company previously revealed a $20 billion AI networking backlog, and HSBC analyst Frank Lee contends that this figure may even understate the upcoming results.
Lee updated his FY26 and FY27 AI networking revenue projections to $17 billion and $30 billion respectively — 43% and 64% above Wall Street’s current consensus. That’s a wide gap between what most analysts expect and what HSBC sees as the likely reality.
Despite that optimism, HSBC cut its price target from $535 to $450. The reason? A broader “valuation reset” for AI-focused companies. Lee kept his Buy rating intact, but the target cut signals that the market has repriced the sector.
The AI Spending Backdrop
One reason analysts remain bullish is that the biggest tech spenders aren’t slowing down. Melius Research analyst Ben Reitzes pointed to Meta and both raising their 2026 capital expenditure estimates by around 30%. That kind of commitment to AI infrastructure spending flows directly to companies like Broadcom.
“The rationale for spending remains strong,” Reitzes said, adding that OpenAI and Anthropic have also raised revenue forecasts as enterprise demand grows.
He rates AVGO a Buy with a $530 price target, calling this “another outstanding quarter” based on the rising backlog.
The Nvidia Warning Sign
Not everyone is feeling relaxed ahead of the print. reported fourth-quarter results on February 25 that beat estimates and offered stronger-than-expected guidance. The stock still dropped 5.5% the next day.
Broadcom fell 3.2% in sympathy on February 26. That kind of reaction — where a beat-and-raise still results in a sell-off — has put traders on edge.
Paul Meeks of Freedom Capital Markets flagged the concern directly: “I’m a bit anxious about the reaction to AVGO’s quarterly report and guidance on March 4, particularly given the reactions last week to the announcements from other AI bellwethers.”
The valuation picture adds more weight to that caution. Broadcom is currently trading at 26.9 times forward earnings, above both Nvidia at 21.3 times and AMD at 25.7 times.
UBS analyst Timothy Arcuri noted that a recent software sector selloff has contributed to Broadcom’s underperformance this year. The stock has gained 64% over the past 12 months but is down 9% in 2026.
HSBC’s Lee said the next meaningful catalyst beyond earnings would be any positive development around AI networking expansion, given Broadcom’s rapidly growing portfolio in that space.
