Broadcom plunged 12% in premarket trading after it maintained its $100 billion fiscal 2027 AI revenue target despite Q2 sales beating expectations and sentiment hitting 99/100 bearish. Morningstar raised its target to $650 from $550 and Jefferies to $550 from $500, citing conservative guidance and strong AI chip demand outlook.
Broadcom shares slid more than 12% in early premarket trading after management held its fiscal 2027 AI revenue guidance at $100 billion despite reporting second-quarter sales and current-quarter forecasts above market expectations. Investor sentiment registered 99/100 bearish on social platforms, reflecting disappointment over unchanged long-term targets.
Morningstar raised its price target on Broadcom to $650 from $550, describing the $100 billion AI revenue target as deliberately conservative. Jefferies increased its price objective to $550 from $500 and maintained a Buy rating, forecasting further operating margin expansion as AI chip revenue accelerates.
Broadcom’s multi-year agreements with Google for future TPUs, Meta for MTIA accelerators and a 10-gigawatt supply deal with OpenAI underpin its AI growth strategy. Analysts project nearly 200% chip sales growth in fiscal 2026 and model fiscal 2028 AI revenue at $200 billion based on ramp-ups with Anthropic and OpenAI.
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