Broadcom Reports Record Q3 FY2026 Earnings with AI Revenue Surging to $16.7 Billion

Broadcom has announced its Q3 fiscal year 2026 earnings, showcasing a remarkable revenue of approximately $29.6 billion, an 86% increase year-over-year. Notably, the company’s AI semiconductor revenue reached $16.7 billion in the quarter, marking a staggering 221% growth compared to the previous year.

AI semiconductors now constitute a substantial portion of Broadcom's business, accounting for about 54% of total revenue. This shift underscores the company's strategic pivot towards AI technology, with CEO Hock Tan emphasizing that the AI segment is no longer a side venture.

Looking ahead, Broadcom forecasts its AI semiconductor revenue to hit around $230 billion by fiscal 2028, a fourfold increase from the anticipated $58 billion for this fiscal year. This ambitious projection reflects the growing demand for custom chips from key clients, including Google, OpenAI, Anthropic, and Meta, who are making significant investments in AI infrastructure.

During the earnings call, Tan highlighted that AI bookings for Q2 exceeded $30 billion, providing a solid foundation for future growth. The company is also well-positioned to meet this demand, having secured supplies of advanced wafers and high bandwidth memory through 2028.

Despite the impressive growth figures, Broadcom's overall Q3 revenue slightly fell short of analyst expectations, leading to a dip in stock prices. Analysts have varied estimates for Broadcom's 2028 AI revenue, with some projecting it could reach as high as $200 billion, while RBC anticipates the total AI semiconductor market could exceed $550 billion by that year.

Broadcom’s strategy contrasts with competitors like Nvidia, as it focuses on designing custom chips tailored to the specific needs of hyperscalers, rather than standardized products. This approach positions Broadcom uniquely within the rapidly evolving AI semiconductor landscape.