Semiconductors
Broadcom Hints of AI Revenue Growth Accelerating in FY26; Backlog of $110B
Broadcom Q3 results confirm the stock as the number two player in AI as a combination of AI networking, custom silicon and AI software propelled total revenue to record levels. Semiconductor Solutions accelerated nine points to 26% YoY growth due to a rebound in AI accelerators (+63% YoY) and networking (170% YoY). While non-AI Semiconductor revenue remains weak and flat sequentially, VMware’s contribution helped prop up the segment. Looking ahead, Broadcom’s Q4 guide implies acceleration into year-end, with total revenue expected to reach $17.4B. More importantly, we picked up on a subtle shift in commentary from CEO Hock Tan regarding AI revenue growth in FY26, which should place Broadcom firmly above $30 billion for next fiscal year. Tan stated: “[...] we now expect the outlook for fiscal 2026 AI revenue to improve significantly from what we had indicated last quarter.”
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