Broadcom reported strong fiscal first-quarter 2026 results as demand for custom AI chips and data center networking continued to expand. The company posted revenue of $19.31 billion, up 29% from a year earlier, while adjusted earnings per share rose to $2.05 from the prior-year period. Both figures came in above analyst expectations, and management pointed to AI infrastructure demand as the main growth driver.
AI revenue reached $8.4 billion in the quarter, a 106% year-over-year increase. Broadcom said custom AI accelerators and AI networking products led that performance. Management added that custom AI ASIC revenue rose 140%, while AI networking revenue increased 60%, showing that the company benefits from both computing and connectivity spending inside large data centers.
The earnings report arrived as investors continued to watch whether AI-related chip demand could offset slower trends in other business lines. Broadcom’s stock traded at $330.48 on March 7, 2026, with a market value of about $1.36 trillion.
Broadcom’s semiconductor solutions segment generated $12.5 billion in first-quarter revenue, up 52% from a year earlier. At the same time, infrastructure software revenue rose 1% to $6.8 billion, with VMware revenue increasing 13%. The contrast showed how much of Broadcom’s current momentum came from semiconductors tied to AI infrastructure rather than from its broader software portfolio.
Management said the company’s five largest custom AI chip customers continued to progress with their programs. Broadcom also said it sees a path to more than $100 billion in AI chip revenue by fiscal 2027. In addition, the company recently outlined a target to sell at least 1 million 3D stacked chips by 2027.
Broadcom also signaled that networking could become an even larger contributor. Management expects the growth of AI networking to accelerate in the second quarter, supported by Tomahawk Ethernet switch products and SerDes connectivity components. This becomes critical as hyperscale data centers need faster data movement as AI workloads scale across larger clusters.
For the second quarter of fiscal 2026, Broadcom predicts a total revenue of about $22 billion, which would mark 47% year-over-year growth. The company expects AI semiconductor revenue to reach $10.7 billion in the quarter, again supported by custom accelerators and networking demand. It also announced a $10 billion share repurchase program through the end of 2026.
Investors also continue to track profitability as the AI mix shifts. Broadcom reported a gross margin of 77% in the first quarter, down from 79.1% a year earlier, though management said margins should remain flat sequentially in the current quarter. The decline suggests that strong AI growth still comes with mix-related pressure, especially as custom ASIC products carry lower margins than some other semiconductor lines.
Analyst views remain mixed despite the strong report. Some firms have kept positive ratings, while others have lowered price targets and raised questions about how durable certain customer programs may prove beyond fiscal 2027. Broadcom’s next few quarters will likely shape whether rapid AI growth can continue to justify those expectations.