Broadcom to report Q3 earnings: What it means for chip stocks

Broadcom (AVGO) stock is drawing attention as the company prepares to release its fiscal third quarter earnings results on Thursday after the market close. Catalysts co-hosts Brad Smith and Madison Mills discuss the AI chip name, exploring how this earnings report could potentially serve as the next significant catalyst for semiconductor stocks.

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This post was written by Angel Smith

Video Transcript

This has been fun to watch.

We're looking at Broadcom right now, a BG share, uh A vgoabgo, those shares are up by about 1.2% ahead of earnings.

They're out after the bell today.

The next test for the A I trade.

Now we spoke to Patrick Moorhead, who's the founder, CEO and chief analyst at more insights and strategy about Broadcom's place in the A I chip landscape.

And here's what he had to say A MD is the next best replacement, particularly because they both have GP US uh followed very closely by Broadcom.

The counter to a GP U is what's called an Asic and those are primarily uh built by Broadcom and they supply Amazon Microsoft Meta uh Google across that.

And so with all of that in mind, I mean, he was really talking about some of the ways to get into the broader chip A I trade without having to be so dependent on continued returns from NVIDIA at this juncture and who some of the other order flow uh could, could ultimately benefit at this point.

And Broadcom gonna be the next big test, as we mentioned uh when they report earnings later today and it could be a critical catalyst for the broader chip sector and the tech names, right, because we have seen these names under a lot of pressure and video down over 18% in the last five days, wiping nearly $300 billion off its market cap in just one day session.

I mean, this is a sector that is looking for something to grasp on to for upside growth.

We have seen broadcom outperforming the semiconductor index more broadly, they've got about a third of their revenue coming from A I to the tune of $3 billion.

So if they do see positive earnings, that could be a sign for more growth to come in the broader A I space.