Broadcom Beats on AI Surge
Broadcom crushed Q1 FY26 expectations and the stock jumped post-earnings on continued AI demand. Other notable earnings: Okta beat Q4 with FY27 revenue guidance in-line, while JD.com fell on an earnings miss and food-delivery competition concerns. CIEN dropped despite beating estimates and strong guidance.
Broadcom's Q1 FY26 revenue hit a record $19.3 billion, a 29% increase year-over-year, significantly fueled by its AI division. The company's AI-specific revenue alone rocketed 106% from the previous year to reach $8.4 billion, thanks to high demand for custom AI accelerators and networking solutions. Looking ahead, Broadcom projects the AI momentum to accelerate, forecasting AI semiconductor revenue to hit $10.7 billion in the second quarter. The company provided a strong Q2 outlook with total revenue expected to grow to $22 billion and announced a new $10 billion share repurchase program. The acquisition of VMware continues to bolster Broadcom's software infrastructure segment. CEO Hock Tan highlighted that deep partnerships with hyperscalers are a core part of the strategy, with a vision for AI chip revenues to potentially reach $100 billion in fiscal year 2027. While Okta's Q4 revenue grew 11% year-over-year to $761 million, its stock dipped following the report. The identity management company's fiscal 2027 revenue guidance of 9% growth, impacted by a shift in its professional services strategy, was viewed cautiously by investors. JD.com's stock fell after missing Q4 earnings and revenue expectations. The e-commerce giant reported a 2% decline in its core JD Retail segment and faced a significant drop in its adjusted EBITDA, turning negative to RMB0.8 billion from a positive RMB12.5 billion the previous year. Networking company Ciena dropped despite beating Q1 estimates and raising its full-year revenue forecast. It reported Q1 revenue of $1.43 billion, a 33% annual increase, and raised its fiscal 2026 revenue guidance to a range of $5.9 billion to $6.3 billion.
