Broadcom shares plunge $520B after AI revenue guidance misses expectations
In brief
- Broadcom posted $22.2B Q2 revenue, up 48% YoY, with AI revenue reaching $10.8B (143% YoY growth).
- Q3 AI revenue guidance of $16B missed analyst consensus of $17.2B by approximately $1.2B.
- Single-day market cap loss of $280–$340B on June 4; cumulative decline reached $520B by late June.
- Broadcom shares fell 25% from year's peak by early September 2026, trading at $365–$370.
The Numbers
Broadcom's fiscal Q2 2026 revenue reached $22.2 billion, marking a 48% year-over-year jump. AI semiconductor revenue hit $10.8 billion for the quarter, a 143% year-over-year increase. These figures rank among the strongest revenue numbers in the company's history.
Yet the market's reaction was unforgiving. For Q3 2026, Broadcom projected AI revenue of $16 billion, while analysts had penciled in roughly $17.2 billion—a $1.2 billion shortfall.
The Selloff
On June 4, shares fell approximately 12 to 15%, erasing somewhere between $280 billion and $340 billion in market capitalization in a single day. The losses extended well beyond June 4. By late June, the stock was down more than 20% from its recent highs. The cumulative market cap loss since early June reached approximately $520 billion.
The semiconductor sector absorbed the shock too. The broader semiconductor sector shed roughly $1.3 trillion in market value during June.
Longer-Term Targets Intact
Broadcom didn't abandon its growth narrative entirely. The company reiterated its full-year 2026 AI revenue target of $56 billion and maintained its longer-term goal of surpassing $100 billion in AI semiconductor revenue by fiscal 2027.
As of early September 2026, Broadcom shares were trading in the $365 to $370 range, down from a year's peak of around $495—a decline of roughly 25% from the top.
The episode underscores how investor expectations, not just fundamentals, drive markets. A guidance miss of $1.2 billion on a $16 billion forecast—less than 8%—erased half a trillion dollars in valuation. The disconnect between execution and sentiment remains one of the most volatile forces in equities.
