Broadcom stock drops 6% after strong earnings, but positive outlook and growth potential ahead.

From Nasdaq: 2025-06-10 11:55:00

Broadcom (AVGO) shares fell 6.2% after reporting second-quarter fiscal 2025 results. Earnings of $1.58 per share beat estimates by 0.64%, with revenues of $15 billion surpassing by 0.37%. Third-quarter guidance reflects weakness in some sectors but strong demand for AI semiconductors is driving growth, with XPU revenues growing double digits year over year. AVGO’s stock has outperformed peers YTD.

Broadcom’s expanding AI portfolio, strong partner base, and focus on AI-powered security are driving growth. The company sees significant opportunities in the AI space, with third-quarter fiscal 2025 AI revenues expected to increase by 60% year over year. AVGO’s solid liquidity position allows for shareholder-friendly actions like dividends and buybacks.

Analysts project a positive outlook for AVGO, with earnings estimates for fiscal 2025 and the third quarter showing growth. The stock is trading at a premium compared to peers but justifies the valuation with its expanding AI portfolio and strong growth potential. Investors are advised to consider accumulating AVGO shares given its strong market position and growth prospects.



Read more at Nasdaq: Broadcom Dips 6% Post Q2 Earnings: Is the AVGO Stock Still a Buy?