Broadcom Shares Decline as Tepid Q4 Forecast Overshadows AI Growth Outlook

Broadcom Inc. (AVGO) shares fell in premarket trading after the company issued a fourth-quarter revenue forecast that came in below Wall Street expectations, overshadowing an otherwise strong earnings report and a bullish outlook for artificial intelligence-related growth.

As of 8:23 AM EDT on Sep. 3, 2026, the stock was trading at $354.36, a decline of 3.51%, according to Investing.com.

Weaker Guidance Hits Shares

The market's negative reaction followed Broadcom's latest financial update. While the company reported third-quarter revenue of $29.59 billion and adjusted earnings per share of $3.32, both figures surpassed analyst estimates.

However, the company's guidance for the upcoming fourth quarter projected revenue near $34.8 billion. This figure fell short of the consensus estimate of approximately $35.05 billion, creating concern among investors about the company's near-term execution.

Long-Term AI Outlook Remains Strong

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Despite the soft near-term forecast, Broadcom's management presented a powerful long-term growth narrative centered on AI. The company projects its AI-related revenue will reach $115 billion in fiscal year 2027 and double to $230 billion in fiscal year 2028.

This ambitious outlook implies two consecutive years of approximately 100% growth in its AI segment. Some analysts suggest the current guidance may be conservative; Barclays, for instance, described the forecast as being "supply-constrained," according to the source material.

Context and Market Risks

Analysts have pointed to several risks that could temper the optimistic long-term view. TD Cowen noted that customer concentration and potential financing concerns remain factors for investors to watch.

The stock's valuation has been a key focus, with the source noting a trailing price-to-earnings multiple of 59.6x as of April 30, 2026. This high valuation makes the stock sensitive to any perceived stumbles in quarterly performance, even as the fundamental growth story appears intact.