Broadcom just delivered the kind of earnings report that would make most companies pop champagne. Record revenue, massive year-over-year growth, and a reaffirmed long-term target that reads like science fiction. Instead, the stock cratered nearly 13-15% on June 4, dragging the entire semiconductor sector down with it.
The Philadelphia Semiconductor Index, better known as the SOX, closed down roughly 2% after plunging as much as 6.3% intraday. For an index that had surged nearly 6% in the days prior on pure AI enthusiasm, it was a swift and humbling reversal.
Record numbers, wrong kind of reaction
Broadcom’s fiscal Q2 2026 results were, by any normal standard, spectacular. Revenue hit $22.2 billion, a 48% increase year-over-year. That’s a record quarter for the company.
But the forward-looking guidance told a different story. Broadcom projected AI chip revenue of approximately $16 billion for the upcoming quarter. Wall Street’s consensus estimate sat at roughly $17.2 billion. That $1.2 billion gap, representing about a 7% miss on expectations, was enough to send the stock into freefall.
