Broadcom Stock Surges 90% in 6 Months – What’s Behind the Rally?

From quantitative point of view, The 90.4% change in Broadcom (AVGO) stock from 4/12/2025 to 10/9/2025 was primarily driven by a 71.0% change in the company’s Net Income Margin (%). There is more to this story than just numbers, but first, let’s break down the stock price movement into its contributing factors.

That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure.

Coming back to the “change”: The change in fundamental factors such as valuation, revenue and margins, has an underlying business and investor sentiment story behind it. Below, we have identified key developments that influenced stock price movement for AVGO stock. Before that, as a quick background: AVGO provides semiconductor devices and infrastructure software, including set-top box system-on-chips, cable, DSL, and passive optical networking solutions.

Here Is Why Broadcom Stock Moved

• Broadcom demonstrated significant growth in its AI semiconductor solutions, with Q2 fiscal year 2025 AI revenue increasing 46 percent year-over-year to over $4.4 billion and Q3 AI revenue accelerating to 63 percent year-over-year to $5.2 billion, driven by robust demand for AI networking and custom AI accelerators. The company expects this strong growth in AI semiconductor revenue to continue into fiscal year 2026.
• The company reported strong financial results for both the second and third quarters of fiscal year 2025, often exceeding Wall Street’s expectations for revenue and adjusted earnings per share.
• Broadcom’s infrastructure software segment, significantly bolstered by the VMware acquisition, showed robust performance, with Q2 revenue reaching $6.6 billion, a 25 percent year-over-year increase, and Q3 revenue growing to $6.8 billion, a 17 percent year-over-year increase, primarily driven by strong adoption of VMware Cloud Foundation.
• The company achieved a record consolidated backlog of $110 billion in Q3, with AI-related demand being a major contributor to the semiconductor portion, providing substantial revenue visibility for future periods. Broadcom also provided optimistic guidance for its fourth quarter fiscal year 2025 and reiterated high confidence in achieving long-term growth targets.
• Numerous Wall Street analysts maintained or upgraded their ratings for Broadcom and increased price targets, resulting in a consensus “Strong Buy” rating due to the company’s strong performance in the AI and infrastructure software markets.

Our Current Assesment Of AVGO Stock

Opinion: We currently find AVGO stock attractive but volatile. Why so? Have a look at the full story. Read Buy or Sell AVGO Stock to see what drives our current opinion.

Risk: That said, AVGO isn’t immune to big drops. It fell nearly 48% during the Covid pandemic, about 35% in the 2021 inflation shock, and around 27% in the 2018 correction. Even with solid fundamentals, it’s clear the stock can take a serious hit when the market turns. Good companies still feel the pain when sentiment shifts sharply.

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