JPMorgan analyst Harlan Sur reiterated an Overweight rating on Broadcom Inc. (NASDAQ: AVGO), projecting fiscal 2026 AI revenue could exceed $56 billion. This estimate implies more than 180% year-over-year growth, driven by advancing custom chip programs with hyperscalers like Alphabet Inc.’s (NASDAQ: GOOGL) Google.

The bank expects AI revenue to grow another two to 2.5 times in fiscal 2027, reinforcing its bullish stance on the semiconductor designer’s market position.

Google TPU Roadmap Remains Intact

JPMorgan pushed back against concerns about competition disrupting Broadcom’s Google Tensor Processing Unit (TPU) business. The firm stated that Broadcom has started ramping Google’s next-generation 3-nanometer TPU v8i ASIC. It also expects the 2-nanometer TPU v9 to ramp in early 2028.

An April five-year agreement between Google and Broadcom remains in effect. The deal secures Broadcom’s role across four TPU generations, from v8 through v11. It includes commitments for rising annual TPU-related revenue through 2031.

JPMorgan noted that reports of potential TPU v9 delays or cancellations do not match its research. Broadcom has also started early intellectual property design work for the subsequent TPU v10 generation.

AI Networking Demand Outstrips Supply

Strong demand persists for Broadcom’s AI networking products. Demand for Tomahawk 5 and the next-generation Tomahawk 6 remains above Broadcom’s supply capacity for this year and next year, according to analysts.

Beyond Google, Broadcom’s custom AI chip programs are in various stages of design, ramp, or production with:

• Meta Platforms Inc. (NASDAQ: META)
• OpenAI
• Anthropic
• ByteDance Ltd.
• Alibaba Group Holding Limited (NYSE: BABA)
• SoftBank Group Corp. (OTC: SFTBY)-backed Arm Holdings plc (NASDAQ: ARM)
• Apple Inc. (NASDAQ: AAPL)
• SambaNova Systems Inc.

What the Numbers Show

Broadcom’s revenue visibility extends significantly beyond current fiscal cycles. The combination of a five-year agreement securing TPU generations v8 through v11 and rising annual revenue commitments through 2031 creates a long-duration revenue floor. This structural contract coverage contrasts with the spot-market volatility often seen in broader semiconductor sectors, suggesting that near-term execution risks are mitigated by multi-year hyperscaler commitments.

Broadcom Price Action

Broadcom shares were up 0.23% at $363.32 at the time of publication on Thursday, according to Benzinga Pro data.

Broadcom Inc. (NASDAQ: AVGO) shares traded approximately 0.5% higher in Thursday’s premarket session, defying weakness in the broader market. Nasdaq futures fell about 0.5%, while S&P 500 futures declined 0.41%.

The early gain reflects trader positioning around a critical technical zone following a multiweek pullback from the June swing high. No single company-specific headline drove the movement.

Technical Analysis

Broadcom trades at $364.17, sitting just 0.8% below its 200-day simple moving average (SMA) of $369.20. This longer-term average often serves as a key gauge for trend direction.

However, the stock remains significantly below shorter-term averages. It trades 8% below the 20-day SMA of $398.16 and 5.8% below the 50-day SMA of $389.14. This divergence indicates cooled near-term momentum.

The moving average convergence divergence indicator remains below its signal line with a negative histogram, suggesting faded buying momentum. Despite this, the longer-term setup remains constructive. The 20-day SMA stays above the 50-day SMA, which in turn remains above the 200-day SMA following a golden cross in April.

Bulls need Broadcom to reclaim its 20-day and 50-day averages to strengthen the technical picture. Key resistance sits at $414.50, while support rests near $358, where buyers previously stepped in.

Earnings And Analyst Outlook

Broadcom is scheduled to report earnings on Sept. 2. Wall Street expects earnings per share of $3.16, up from $1.69 a year earlier. Analysts project revenue of $29.44 billion, compared with $15.95 billion in the year-ago period.

The stock trades at a price-to-earnings ratio of about 60.3, reflecting a premium valuation. It carries a Buy consensus rating with an average price forecast of $513.68.

Recent analyst actions include:

• Erste Group downgraded Broadcom to Hold on July 7.
• UBS maintained a Buy rating on June 4 but lowered its price forecast to $485.
• Bank of America Securities maintained a Buy rating on June 4 and raised its price forecast to $530.

What the Numbers Show

The disparity between expected revenue growth and current valuation highlights investor expectations. Revenue is projected to nearly double from $15.95 billion to $29.44 billion, yet the stock commands a P/E multiple of 60.3. This suggests the market has largely priced in this aggressive growth trajectory, leaving little room for execution error.

Benzinga Edge Rankings

Broadcom’s profile shows strong fundamentals but mixed momentum:

• Quality: Strong score of 95.15, indicating solid underlying business fundamentals.
• Momentum: Neutral score of 47.28, reflecting the ongoing pullback.
• Growth: Neutral score of 30.72, noting solid but not top-tier growth relative to peers.
• Value: Neutral score of 6.47, driven by premium valuation demands.

Top ETF Exposure

Broadcom holds significant weight in major technology funds, meaning ETF flows can impact stock pressure:

• iShares Semiconductor ETF (NASDAQ: SOXX): 8.12% weighting.
• First Trust NASDAQ Technology Dividend Index Fund (NASDAQ: TDIV): 8.05% weighting.
• iShares Expanded Tech Sector ETF (NYSE: IGM): 7.71% weighting.