"The numbers looked solid on the surface. Q4 revenue hit $18.02B, topping the $17.49B estimate, while adjusted EPS of $1.95 beat the $1.87 consensus. AI semiconductor revenue surged 74% year over year, and management guided Q1 revenue to $19.1B, well above the $18.27B Street estimate. Tan projected AI chip sales would double to $8.2B next quarter. But CFO Kirsten Spears flagged a problem that sent the stock lower."
"Tan ended the mystery around Broadcom's unnamed fourth customer, confirming it was Anthropic. The AI startup placed an additional $11B order for delivery in late 2026, on top of the initial $10B commitment. Broadcom also secured a fifth custom chip customer with a $1B order. Yet the concentration risk remains. The $73B backlog still comes from just five customers, and analysts flagged concerns about reliance on a narrow set of hyperscalers for future growth."
Broadcom reported Q4 revenue of $18.02B and adjusted EPS of $1.95, both beating estimates. AI semiconductor revenue rose 74% year-over-year, and management guided Q1 revenue to $19.1B with projected AI chip sales doubling to $8.2B next quarter. CFO Kirsten Spears guided Q1 gross margins down about 100 basis points, citing a higher mix of AI revenue, and warned the $73B backlog includes lower-margin system sales that will grow in fiscal 2026's second half. Anthropic confirmed as a customer added $11B in orders, but the backlog remains concentrated among five customers. The key question is whether margin pressure is transitory or structural.
Read at 24/7 Wall St.
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