Key Stats for Broadcom Stock
- Current Price: $355.59
- Target Price (Mid): ~$1,110
- Street Target: ~$526
- Potential Total Return: ~210%
- Annualized IRR: ~31% / year
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What Happened?
Broadcom Inc. (AVGO) spent a decade as Google’s go-to outside chip designer, and on August 19, that story cracked. Marvell disclosed an expanded custom-silicon deal with Google, and Broadcom shares fell about 5% that day while Marvell jumped. The stock has since drifted to roughly 28% below its 52-week high, and its fiscal third-quarter earnings land on September 2, after the close.
Investors searching Broadcom right now are asking whether the Google relationship is eroding and whether management will finally raise its $100 billion AI target for next year.
The Marvell Deal Put a Price on Broadcom’s One Real Risk
Broadcom has co-designed Google’s tensor processing units for about a decade, and that partnership anchors the entire bull case. So the August 19 filing landed hard. Marvell told the SEC its Google work now spans “custom silicon programs that attach to the TPU ecosystem,” including AI inference accelerators, and Google received a warrant to buy up to roughly 59 million Marvell shares at $206.58, a stake worth about $12.2 billion if fully exercised, tied to purchasing targets through Marvell’s fiscal 2033.
Marvell described programs that “attach to” the TPU ecosystem, not a mandate to build Google’s flagship TPUs outright, so this may be adjacent silicon rather than a direct replacement of Broadcom’s core design work. Still, the market read it as diversification, and the fear is not new. On June 3, Macquarie cut Broadcom to Neutral partly on a forecast that its share of Google’s custom-chip spend could slide from around 95% toward 65% by 2028.
In April, it signed a Google TPU and networking agreement running through 2031, and CEO Hock Tan addressed the diversification question directly on the Q2 call: “we fully expect that there will be some diversity of sources for them,” he said, then added that “our commitment from them is a very substantial dollar amount.”
He also noted the company’s demand visibility now reaches 2028, up from 2027 just three months earlier, a sign the order book is deepening even as competition arrives. Whether the September 2 commentary reinforces that is the most important thing on the call.
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The Guidance Line That Actually Moves the Stock
Broadcom guides to $16 billion in AI semiconductor revenue this quarter, up over 200% year on year, and bookings topped $30 billion in Q2 against the $10.8 billion shipped.
Broadcom fell 12.59% after Q2 despite beating on earnings, and the trigger was narrow: management held its fiscal 2027 AI target at “in excess of $100 billion” rather than raising it. In a stock priced for acceleration, flat guidance read as a stumble. That makes the FY2027 number the hinge. A meaningful raise loosens the Google-share fear, because a bigger total pie can absorb a smaller Broadcom slice.
Another flat guide hands the bears a second data point that growth is leveling off exactly as rivals appear. Networking mix is the quieter tell: it ran near 40% of AI revenue in Q2, and Tan guided the sustainable share back toward 30%, which feeds directly into the richer-margin side of the model.
Financing Ambition Meets a New Line of Worry
On August 20, Bloomberg reported Broadcom is in talks to help arrange more than $60 billion in debt, potentially reaching $100 billion, to finance AI chips for Anthropic and others. This is a reported, unconfirmed financing, and the structure matters: a special-purpose vehicle would issue the debt and Broadcom would guarantee only a portion, rather than borrowing the full sum itself. It extends the AI XPV platform Broadcom launched with Apollo and Blackstone in June, whose first tranche was valued at $35 billion.
The bull reads it as Broadcom removing the one thing that could cap AI demand: whether customers can pay for compute up front. As Tan put it on the call, the goal is to “have these chips funded for these LLM players who otherwise might have difficulty getting access to our technology.” The bear reads guarantee risk, and the market has started pricing it, with Broadcom’s credit-default swaps widening about 28 basis points on August 24. Either way, it ties Broadcom’s fortunes more tightly to a handful of frontier labs, the same concentration the Google news exposed.
On the TIKR Competitors page, Broadcom trades at an NTM P/E ratio of about 22.5x, below the semiconductor peer mean near 31x. Nvidia sits around 19x, while Marvell trades near 53x and AMD near 43x. Broadcom is not the cheapest AI name, but it is priced well under the group average despite holding some of the most durable multi-year contracts in the sector. That gap reads more like a post-earnings reset that has not recovered than a structural penalty, as long as the September 2 guidance cooperates.
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TIKR Advanced Model Analysis
- Current Price: $355.59
- Target Price (Mid): ~$1,110
- Potential Total Return: ~210%
- Annualized IRR: ~31% / year
See analysts’ growth forecasts and price targets for Broadcom stock (It’s free!) >>>
Revenue drivers: AI semiconductor scaling, where revenue is guided to double in the second half of fiscal 2026 and exceed $100 billion in fiscal 2027, and the VMware base, where annual recurring revenue grew 17% year over year.
Margin driver: mix and operating leverage, with software gross margins above 93% offsetting lower custom-silicon margins and operating margin holding near 67%. The mid case assumes revenue compounds near 30% and net income margin lands around 55% by 2030.
Primary risk: customer concentration. A few frontier labs and hyperscalers drive most AI revenue, and the Marvell-Google deal is a live reminder that any one of them can add a second supplier.
Upside: a raised FY2027 AI guide plus a held Google share closes the peer discount and makes the mid case look conservative.
Downside: another flat guide alongside visible share loss keeps the multiple compressed no matter how strong the reported quarter is.
Conclusion
One line decides it on September 2: the fiscal 2027 AI semiconductor guidance. A raise above the standing $100 billion floor signals management is comfortable enough with its Google position to let a bigger number speak, and it would likely lift the stock off its drawdown. Another flat guide, especially with cautious words about supplier diversification, confirms what the bears have argued since June. The report lands after the close on September 2, with the call at 5:00 p.m. Eastern.
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Should You Invest in Broadcom?
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Pull up Broadcom, and you’ll see years of historical financials, what Wall Street analysts expect for revenue and earnings in the quarters ahead, how valuation multiples have moved over time, and whether price targets are trending up or down.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
