AVGO Stock Risks Breakdown Below $300 Despite CEO’s $100B AI Chip Revenue Goal

Quick overview

Shares of Broadcom Inc. surged on strong earnings and booming AI demand, but the rally quickly faded as technical resistance capped gains and downside risks re-emerged.

Rally Fades at Key Resistance

Broadcom Inc. saw a sharp but short-lived rally following its latest earnings release, with the stock briefly pushing higher before failing to break above the critical $350 resistance level.

The inability to sustain momentum has since led to a pullback, with shares now drifting toward the $300 level, an area investors are closely monitoring as a key support zone. A break below this level could signal further downside, highlighting the growing tension between strong fundamentals and weakening technical momentum.

Strong Earnings and Upbeat Outlook

The company’s first-quarter fiscal 2026 results were solid, with revenue rising 29% year-over-year, driven by robust demand across its semiconductor business.

Broadcom’s semiconductor solutions segment was the standout performer, posting a 52% increase in revenue, supported by strong demand for advanced chips and networking solutions. Profitability remained strong, with solid earnings growth, high EBITDA margins, and continued free cash flow generation reinforcing the company’s financial strength.

AI Remains the Core Growth Engine

Chips continue to drive Broadcom’s expansion. Chip revenue reached $8.4 billion during the quarter, representing an impressive 106% year-over-year increase.

Demand is being fueled by hyperscale data center operators investing heavily in custom AI accelerators and high-performance networking infrastructure. CEO Hock Tan indicated that AI semiconductor revenue is expected to climb further to $10.7 billion in the second quarter, reflecting sustained momentum.

Looking further ahead, management highlighted a potential pathway to generating more than $100 billion in AI chip revenue by 2027, significantly boosting long-term growth expectations.

Technical Analysis – The Lower Highs Continue

Broadcom entered the new year on uncertain footing, with its share price dipping below $300 as confidence across the AI semiconductor complex began to fray. After months of near-uninterrupted gains, investors have turned more defensive, questioning how much of the AI opportunity is already priced into leading infrastructure names.

AVGO Chart Daily – The 100 SMA Is Under Attack

The bearish momentum continued and AVGO shares fell sharply last month, threatening to break the 100-day simple moving average (red) which has acted as support before. However the 100 SMA (red) held as support and we saw a strong rebound after the earnings last week, taking the stock to $350. But moving averages continue to reject the price and we saw a reversal lower last week and this week the decline continues, despite the improved sentiment, so AVGO stock is heading to the 100 daily SMA again and it might fall under $300 if that moving average breaks.

Analyst Confidence Remains Strong

Following the earnings release, Rosenblatt Securities raised its price target on Broadcom to $500, maintaining a Buy rating. The upgrade reflects increased confidence in the company’s AI growth trajectory and improved visibility into future revenue streams.

Innovation Showcased at OFC 2026

At the Optical Fiber Communication (OFC) Conference and Exhibition 2026, Broadcom showcased its expanding AI infrastructure portfolio. Key highlights included the launch of a 102.4T Ethernet switch (Tomahawk 6-Davisson) featuring co-packaged optics, as well as new 400G optical DSPs and 200G Ethernet retimers.

These innovations are designed to support ultra-fast connectivity for next-generation AI data centers, positioning Broadcom at the center of large-scale computing infrastructure.

Outlook: Fundamentals vs Technical Pressure

Despite strong fundamentals and a compelling AI growth story, Broadcom’s stock is currently being driven by technical factors and broader market sentiment.

While long-term prospects remain supported by accelerating AI demand and strong earnings growth, the near-term outlook depends on whether the stock can hold key support near $300. A sustained break below this level could trigger further weakness, while a recovery above resistance may be needed to reignite bullish momentum.

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.

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