Welcome to Staten News, where Broadcom beat everything except the one number that mattered.
Broadcom posted revenue of $29.59 billion. Wall Street wanted $29.36 billion. Adjusted earnings came in at $3.32 a share against expectations of $3.24. AI chip revenue hit $16.7 billion, up 221% year over year.
The stock fell 3.49% anyway.
Why the beat didn’t matter
Broadcom guided fourth-quarter revenue to $34.8 billion. Analysts wanted $35.03 billion. That gap was enough to erase the entire beat from the headline numbers.
Wall Street doesn’t grade the quarter you just had. It grades the quarter you’re about to have.
Management still flagged $115 billion of secured AI revenue for fiscal 2027 and $230 billion for fiscal 2028. Free cash flow hit a record $13.7 billion, 46% of revenue. None of it mattered next to one soft guidance line.
The rest of the tape had a better day
Snowflake didn’t have Broadcom’s problem. Its Q2 numbers came in as a genuine blowout, and the stock jumped more than 20% before lunch.
Tesla popped 7% ahead of tonight’s Cybercab event. Nvidia added another 1.5% on news it’s acquiring Hugging Face. Robinhood climbed on analyst upgrades. Dell beat earnings estimates by nearly 50%, posting $7.04 a share against a $4.97 estimate.
Translation: the market is still rewarding growth stories. It’s just gotten a lot pickier about which growth story it believes.
The macro backdrop
The S&P 500 closed up 1.01% to 7,745. The Dow gained 1.20% to 53,713. The Nasdaq led with a 1.36% gain to 26,573.
Treasury yields fell 5 basis points to 4.75% after Fed Governor Christopher Waller said he’d lean toward holding rates steady unless inflation surprises to the upside.
That’s the whole market in one sentence. Rates cooling, growth stocks running, and one $115 billion AI roadmap getting punished for a guidance number smaller than a rounding error.
This is not financial advice. Always do your own research.
— The Bandicoots 📉💰