Broadcom Faces March 4 Earnings Test on AI Momentum and VMware Questions
Options imply an 8.64% swing on a quarter projected at $19.21 billion revenue, $2.02 EPS.
Overview
- AI chip revenue is expected to reach about $8.2 billion this quarter, roughly doubling from a year ago.
- Broadcom has begun shipping its first 2nm custom compute SoC using 3.5D eXtreme Dimension packaging, designed to boost efficiency and cut latency in AI clusters.
- On Feb. 26 the company flagged very strong demand for a stacked AI chip, and Reuters reported shipments could reach at least one million units by 2027.
- Analysts highlight risks in the infrastructure software portfolio acquired with VMware, including potential renewal churn and slower growth after upgrade cycles as more workloads shift to the cloud.
- Investor sentiment remains broadly positive, with UBS reiterating a Buy and a $475 target and recent consensus at 28 Buys, 2 Holds with an average price target near $452.32.