Broadcom Stock Slipped While Its Revenue Schedule Got Longer

Broadcom (AVGO) stock sits about 23% below its 52-week high, and it has lost 6.9% over the past three months while the S&P 500 gained 3.6%. The latest drop followed a fiscal Q4 2026 revenue guide that fell short of Wall Street expectations. Set beside that guide was a revenue schedule stretching to fiscal 2028. That schedule is where the upside case lives.

Custom Accelerators Now Make Up Most Of Broadcom’s AI Revenue

AI semiconductor revenue reached $16.7 billion in fiscal Q3 2026, more than triple a year earlier and 56% of the $29.6 billion in consolidated revenue, up from 49% in fiscal Q2 2026.

Broadcom delivered the TPU version 7 in high volume, began production shipments of the TPU version 8i, and shipped OpenAI’s first-generation custom accelerator. Meta’s MTIA accelerator is guided into production in fiscal Q4 2026. Custom accelerators made up 73% of AI revenue in fiscal Q3 2026.

Each of those chips is built around one buyer’s own models, and the agreements behind them run in generations. Broadcom expects to deliver three generations of MTIA to Meta between now and the end of 2027. Winning that kind of position takes years, and so does losing it.

Broadcom Says It Has The Supply And Still Has To Land It

Management has guided AI revenue to roughly $115 billion in fiscal 2027 and roughly $230 billion in fiscal 2028 and says the supply is secured for both. Including fiscal Q3 2026, Broadcom’s trailing-twelve-month revenue is about $89.2 billion, versus $75.5 billion through fiscal Q2. That puts the AI business on a rapidly expanding trajectory.

The gate is not demand. Management has pointed at land, power and data-center shells, and at leading-edge wafers, substrates and HBM memory, any of which it says could become a bottleneck depending on timing. Broadcom is pulling one of those in-house and will start deploying its own Singapore fab for substrates in fiscal 2027.

The mix is thinning the gross margin on the way through. Consolidated gross margin is guided to about 73% in fiscal Q4 2026, down from 78% a year earlier, because the XPUs carry more memory content. Operating margin is guided at about 66%, flat against a year earlier, because revenue growth is outrunning operating spending. The mix costs Broadcom gross margin and has not cost it operating margin.

What You Should Watch Before Buying This Decline

Broadcom has gained more than 30% in under two months on 17 separate occasions since 2010, the most recent in 2026. That is the pattern, not a forecast. The multi-year guidance is the argument.

The first checkpoint is close. Management has guided fiscal Q4 2026 AI revenue to $21.7 billion. That would put fiscal 2026 AI revenue at roughly $58 billion and set the base for the $115 billion fiscal 2027 guidance.

One risk does not resolve on that number. Broadcom has stepped into its customers’ funding, closing a first $35 billion tranche in June with Apollo and Blackstone for one customer’s first gigawatt of deployment, though management says outside partners put up the capital. Where necessary, management says it may provide modest residual value guarantees, which it views as low risk.

If you cannot decide whether a decline like this one is worth buying, our screen for stocks that have already sold off ranks them side by side.

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