Investors are wondering if Broadcom will update its AI revenue guidance, and how durable growth in its AI business will be going forward, J.P. Morgan says

Broadcom reports July-quarter earnings results after the market close on Wednesday.

Broadcom's stock has been weighed down by concerns over its increasing custom-chip competition and its guidance for artificial-intelligence revenue - but one analyst thinks its upcoming fiscal third-quarter earnings report will be able to assuage those fears.

The chip maker's stock (AVGO) has gained just 6.7% this year, after rocketing more than sixfold over the previous three years. In comparison, the PHLX Semiconductor Index SOX has soared 60% in 2026.

The underperformance is mostly tied to worries over its potential share loss at Alphabet's Google (GOOGL) (GOOG) over the long term, "and the lack of incremental color" around its outlook for more than $100 billion in AI revenue in fiscal 2027, J.P. Morgan analyst Harlan Sur said.

Going into Broadcom's earnings call after the market close on Wednesday, Sur said in a note to clients that investors will likely be focused on whether they get a more detailed look into the company's AI revenue guidance, and on what management says about how durable growth in its AI chip business will be going into fiscal 2028.

In Sur's view, the fears around Broadcom's competitive positioning as the top partner for Google's tensor processing units, or AI accelerator chips, "are overstated."

Broadcom and Google have co-developed the latter's custom chips for more than a decade, but reports have suggested Google is looking to MediaTek (TW:2454) and Advanced Micro Devices (AMD) as design partners for future generations of the chips. Marvell Technology (MRVL) said in August that it had expanded its partnership with Google for a range of custom silicon offerings related to its TPUs, including accelerators and storage controllers.

Sur said the partnership and other potential deals "are more reflective of [Alphabet] bringing on more partners to support its internal COT team," referring to Google's Co-Optimization Team, which works on its TPUs and other custom chips. The company could also be looking for opportunities to develop supporting components for chips, he added.

"We do not see any company displacing [Broadcom's] position as [Alphabet's] core TPU partner," Sur said, pointing to the companies' expansion of their partnership with a five-year agreement in April.

Meanwhile, Sur said he sees a favorable setup for Broadcom in fiscal 2027, and he is expecting the company to either raise its $100 billion outlook or offer more color around that number.

"We believe demand, backlog and customer commitments support [fiscal-year 2027] AI revenue materially above the current" framework, he wrote.

Broadcom is expected to report revenue for the July quarter that rose 83% from a year ago to $29.2 billion, according to analysts tracked by FactSet. The consensus calls for adjusted earnings of $3.22 per share, which would represent growth of 90.3% from a year ago.

The company's semiconductor-solutions segment, which includes AI and non-AI chips, is expected to see revenue grow 121.3% from the previous year, to $20.3 billion for the quarter.

That growth is projected to be higher in the fiscal fourth quarter, with analysts looking for semiconductor-solutions revenue to jump 131.4% to $25.6 billion, while total revenue is expected to come in at $34.7 billion. Adjusted earnings per share are expected to increase 97.2% to $3.85 each for the October quarter, according to FactSet estimates.

Meanwhile, Jefferies analyst Blayne Curtis sees "limited upside" to estimates for Broadcom's AI revenue in fiscal 2027, given there are already high expectations for it to reach between $130 billion to $140 billion.

"We just don't think there is much more additional supply to be meaningfully above that," Curtis wrote in a note to clients.

Like Sur, Curtis said he expects Broadcom to remain as "the dominant supplier" of Google's TPUs, though reports of rising competition "are hard to disprove."

Curtis sees upside for Broadcom coming in 2028 from its AI XPV Platform, which is focused on deploying more than 20 gigawatts of Broadcom's custom chips and networking for AI frontier labs including Anthropic and OpenAI. However, with rising memory prices and ongoing compute constraints, Curtis said he thinks "it's too early for management to frame that opportunity."

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-Britney Nguyen