Bank of America has cut its price target on Broadcom to $460 from $530, even as the chipmaker delivered record quarterly results and laid out one of the most aggressive artificial intelligence growth forecasts in the semiconductor industry.
BofA analyst Vivek Arya maintained a Buy rating on AVGO despite reducing the target by $70, according to analyst-tracking data. The new objective still implies meaningful upside from Broadcom’s recent trading levels.
The cut stands out because several other Wall Street firms moved in the opposite direction after Broadcom’s fiscal third-quarter report. Goldman Sachs raised its target to $540 from $525, while Bernstein lifted its objective to $575 from $550. Baird maintained a $630 target, among the highest on Wall Street.
Broadcom’s AI Business Is Growing at Triple Digits
Broadcom reported fiscal Q3 revenue of $29.59 billion, up 86% from a year earlier. Adjusted earnings reached $3.32 per share, while free cash flow climbed to $13.67 billion.
The standout number was AI semiconductor revenue, which surged 221% year over year to $16.7 billion. Broadcom expects that figure to accelerate to approximately $21.7 billion in the fourth quarter.
CEO Hock Tan also dramatically expanded the company’s longer-term AI outlook. Broadcom now expects roughly $115 billion in AI semiconductor revenue in fiscal 2027, followed by about $230 billion in fiscal 2028 as custom accelerators and networking demand grows.
Coinpaper’s latest Broadcom earnings coverage highlighted the same tension: extraordinary AI growth is increasingly being judged against even more aggressive expectations.
Strong Numbers Still Weren’t Enough for AVGO Investors
Broadcom shares fell after the report as investors focused on near-term guidance. The company forecast approximately $34.8 billion in Q4 revenue, a figure that landed close to, or slightly below different Wall Street consensus estimates depending on the data provider.
That reaction reflects a broader problem across AI stocks: rapid growth is no longer automatically enough when expectations are already extreme.
Our broader look at AI chip stocks shows Broadcom competing not only with Nvidia but increasingly with Marvell in custom silicon and networking. Marvell’s expanding Google relationship has added another source of competitive pressure.
The disagreement is therefore less about whether Broadcom’s AI business is growing and more about how much of that growth is already reflected in AVGO’s valuation.
That theme has appeared across the sector. AI infrastructure analysis notes that investors are increasingly weighing growth against valuation, customer concentration and infrastructure constraints rather than simply chasing headline AI revenue.
For Broadcom, BofA’s target cut adds a cautious voice to an otherwise bullish post-earnings analyst chorus. The company’s $230 billion AI forecast is enormous; the question now is whether earnings can grow quickly enough to satisfy expectations that may be even larger.
