Broadcom Target Slashed to $450 While CEO Pay Hits $205M
HSBC maintained Broadcom’s Buy rating, cutting its target to $450 from $535 and forecasting $19.5B in Q1FY26 revenue versus $19.1B guidance, plus $21B in Q2, implying 41% upside. CEO Hock Tan’s 2025 compensation jumped to $205.3M, driven by $202.4M in equity tied to a $120B AI sales goal by 2030.
1. HSBC Upholds Buy Rating and Lowers Price Target
HSBC maintained its Buy rating on Broadcom, trimming its target price to $450 from $535. The bank projects Q1FY26 revenue of $19.5B versus management’s $19.1B estimate and anticipates Q2 revenue of $21B, 3% above consensus, driven by a strong ASIC ramp and AI networking demand.
2. AI Networking and ASIC Forecasts Exceed Street Estimates
HSBC raised its AI networking revenue forecasts to $17B for FY26 and $30B for FY27, 43% and 64% above consensus, based on a disclosed $20B backlog. Its ASIC revenue forecasts for FY26 and FY27 remain 13% and 12% above Street estimates, highlighting expectations for sustained margin expansion and EPS upside.
3. CEO Compensation Realigns with AI Growth Milestones
Chief Executive Hock Tan earned $205.3M in total compensation for 2025, up from $2.63M in 2024, with $202.4M in equity awards linked to AI performance. Under his contract extension, he stands to receive further stock incentives if Broadcom hits $120B in AI product sales by 2030, aligning executive pay with long-term AI revenue targets.