Broadcom results out Wednesday evening could be make-or-break for the stock as jitters around the artificial intelligence trade remain. Shares of the high-flying chipmaker rallied more than 49% in 2025 — and more than 107% the year prior — as the company has benefited from demand for its custom AI accelerator chips, or ASICs. The stock is off to a rough start this year, however, losing about 7% amid a broader decline in technology. Investors have been concerned that Broadcom’s business could be hurt by customer-owned tooling, or COT, which refers to companies designing their own custom chips in-house to reduce reliance on merchant silicon providers. Concerns have also surfaced around Google parent Alphabet’ s partnership with MediaTek on its next-generation TPU, potentially taking away revenue from Broadcom and challenging the company’s longstanding exclusive design partnership with Alphabet. AVGO 1Y mountain Broadcom stock performance over the past year. Many on Wall Street remain confident that COT is not a risk to Broadcom in the coming quarters, however, they believe there is upside at its custom chips business given that a slew of customers are looking to deploy Tensor Processing Units, a kind of ASIC. Analysts from firms including Morgan Stanley, UBS and JPMorgan are notably bullish on Broadcom’s TPU business. They’re also looking to see if Broadcom will give more details on its deal with Anthropic, which last year placed a $10 billion order for Google’s latest TPU Ironwood racks. “Overall, we are expecting a solid quarter and see opportunity for upside in 2026 and 2027. We are [over weight] as we see an attractive catalyst path ahead, with multiple programs ramping over the next two years and an incredibly strong TPU outlook,” Morgan Stanley analyst Joseph Moore wrote in a Monday note to clients, adding that Google shifting its TPU volume away from Broadcom to MediaTek remains a “show-me story.” Consensus estimates imply that the stock has been unfairly punished. Of the 51 analysts on the Street covering Nvidia, 15 maintain a strong buy rating, 34 give it a buy and two have a hold rating, per LSEG. Their consensus price target implies more than 40% upside from Broadcom’s latest close. For its latest quarter, consensus estimates point to Broadcom earning $2.03 per share on $19.18 billion in revenue, per LSEG. Take a look at what the biggest firms are saying: JPMorgan: Overweight rating, $475 price target “We continue to see a strong demand profile for its AI products driven by Google TPU upside, AI networking strength,” analyst Harlan Sur said in a Sunday note. “The non-AI semiconductor business (enterprise, server/storage, broadband) should continue to gradually improve, and we anticipate continued revenue synergy unlock from VMware. As a result, we expect January quarter revenue, earnings, and free cash flow to exceed our and consensus expectations.” Morgan Stanley: Overweight rating, $462 price target Morgan Stanley’s Moore said he continues to view Broadcom as the “best ASIC play,” and reiterated his expectations for strong quarterly results and upside potential in 2026 and 2027 from AI compute and networking. “We continue to anticipate a significant inflection in the second half of the year as Anthropic racks begin contributing meaningfully to results,” Moore wrote. “Demand across AI compute and networking remains robust, and we see potential for meaningful upside to our estimates. Visibility appears strong through year-end, with multiple customers expected to deploy TPUs. Notably, we are observing increasing convergence around the TPU architecture rather than fragmented ASIC approaches, and we continue to expect 90%+ of AVGO’s AI revenue to be TPU-based.” Citi Research: Buy rating, $458 price target Analyst Atif Malik is sticking by Broadcom shares, but trimmed his price target from $480 to $458 in a Feb. 17 note to clients. “We believe Broadcom remains the preferred and strategic partner for Google and expect TPU sales to grow 4x or ~$65B through FY27. AVGO stock P/E multiple has compressed from 40x peak last year to 22x due to gross margin, TPU competition, and software sales exposure risks. We believe these risks are mostly priced-in and expect the stock to outperform in 2H26 as demand visibility extends into 2027 and competitive concerns abate,” he wrote. Jefferies: Buy rating, $500 price target Jefferies analyst Blayne Curtis believes the stock debate around COT has been overblown. Broadcom’s networking business could potentially even outpace its ASICs business in the quarter driven by the ramp of its Tomahawk 6 switch, ongoing DSP share gains, and improving demand in China, Curtis said. “We continue to stand behind our call for 6M+ TPUs and $20 in EPS by C27, and our confidence has increased further on incremental supply‑chain data points and this capex support. We also see the COT overhang as overdone, with strong networking momentum driving additional upside alongside the ASIC opportunity,” Curtis said in a Feb. 4 note. “We reiterate AVGO as our Top Pick and expect the results will speak for themselves.” UBS: Buy rating, $475 price target “As LLM developers push their custom ASIC roadmaps more aggressively, many have turned to TPU as an intermediate alternative to GPU and we believe demand is accelerating significantly. Following a series of supply chain work, we have refined our bottom-up custom ASIC model and now see AVGO shipping > 5MM TPU units in C2027E (versus ~3.7MM in C2026E), of which a little more than half will be v7 (Ironwood) before v8ax (Sunfish) becomes the majority of shipments in C2028E. Both of these are N3 based, where we believe AVGO is able to meet upside with strong wafer allocation from TSMC,” analyst Timothy Arcuri wrote in a Feb. 10 note.
