Broadcom is set to report its fiscal Q3 FY26 results on September 2, and analyst expectations are running high heading into the print. The company has become one of the biggest beneficiaries of hyperscaler AI spending through its custom accelerator (XPU) business alongside its networking chips and its legacy software and semiconductor franchises, which is why its earnings prints have become a closely watched barometer of AI infrastructure demand.

AVGO stock is trading at $368.62, up just 7% year-to-date after a rough stretch that included a 13% drop following Q2 FY26 results. Those results were strong on paper, but missed the elevated AI expectations that had built up on the buy side — a dynamic that has repeatedly punished even fast-growing AI chip suppliers when results merely meet rather than exceed forecasts.

Benchmark Reiterates Buy Ahead of the Print

Benchmark analyst Cody Acree reiterated his Buy rating on AVGO ahead of earnings, keeping his price target at $545. He pointed to the recent pullback as creating a better entry point for investors.

Acree ranks No. 63 out of more than 12,499 analysts on TipRanks, with a 68% success rate and an average return of 33.40% per rating over a one-year period.

What the Numbers Look Like

Wall Street is projecting Q3 FY26 EPS of $3.22, a 90.5% jump year-over-year. Revenue is expected to come in at $29.24 billion, up 83.3% from the same period last year — growth rates that reflect how sharply the custom AI silicon business has scaled the company's top line.

Acree is a touch more optimistic. He is modeling revenue of $29.403 billion and EPS of $3.24 for Q3, both slightly ahead of the Street.

For Q4 FY26 guidance, Acree expects Broadcom to project revenue of $34.902 billion and EPS of $3.89. He believes investors will focus more on the Q4 outlook than on any small deviation in Q3 results — a common pattern for Broadcom, where forward guidance on AI demand typically drives the post-earnings reaction more than the quarter itself.

On the AI chip side, Acree noted that management expects roughly 10 gigawatts of FY27 shipments, with the 2026-27 period already secured and planning underway for 2028-29.

Google remains the volume leader among Broadcom's custom XPU customers, but Acree flagged that Anthropic, OpenAI, and Meta Platforms are expected to add further demand. Two additional customers are also in the mix. Broadening the customer base beyond Google matters because it would reduce Broadcom's reliance on a single hyperscaler for its custom silicon growth.

Competitive Picture

Acree did flag some competitive risks. MediaTek is expected to play a second-source role in certain programs, and Marvell has launched new inference and TPU attach programs that could put some pressure on AVGO's market share. Hyperscalers routinely qualify second suppliers as a standard lever for cost and supply security, which is the backdrop for these moves.

That said, Acree does not view either as a near-term threat to Broadcom's core high-performance TPU relationship. He pointed to Broadcom's April agreement with Google, which covers several future TPU generations and AI networking through 2031, as a key anchor for the business.

Google's efforts to diversify chip suppliers were described as a "share-of-growth" risk rather than a direct threat to AVGO's existing TPU business.

ARK Invest Adds to Its Position

On the institutional side, ARK Invest bought 55,131 AVGO shares on August 28, worth roughly $20.48 million. That followed a similar purchase earlier in the same week, while ARK was simultaneously selling out of AMD — a notable portfolio rotation within AI semiconductors by Cathie Wood's firm.

Wall Street's Strong Buy consensus on AVGO comes with an average price target of $512.36, pointing to roughly 39% upside from current levels. AVGO trades near the low end of its AI peer group valuation. Beyond the September 2 print, the items to watch are the Q4 guidance, any update on the two unnamed custom XPU customers, and how the FY27 shipment plans evolve.