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Revenue reached a company-record $22.2 billion, topping consensus estimates of $22.13 billion and marking 48% year-over-year growth, while adjusted EPS came in at $2.44, ahead of the Street’s $2.39 forecast. Operating margin also climbed to a record 67.3%, and Broadcom guided for ~$29.4 billion in current-quarter revenue, above analysts’ expectations of $28.25 billion.
And yet, despite all the encouraging signs, AVGO shares tumbled 12.5% as investors focused on one figure in particular – AI semiconductor guidance. CEO Hock Tan projected $16 billion in AI semiconductor revenue for the fiscal third quarter, and for a market that had grown accustomed to Broadcom surpassing even the highest expectations, that outlook appeared to come up short.
Is that a fair critique? Top investor Jonathan Weber doesn’t think so in the slightest, going so far as to argue that the “market has lost its mind.”
“The market reaction doesn’t make sense at all. Instead, it’s a nice buying opportunity for those interested in owning this AI winner,” states the 5-star investor, who is among the top 2% of stock pros covered by TipRanks.
