Gary Black expects Broadcom shares to recover after earnings

Shares of Broadcom (NASDAQ: AVGO ) were trading lower on Thursday after the company reported third-quarter financial results and provided an updated guidance range on Wednesday after the market closed.

A market expert thinks shares could quickly recover as investors digest the results.

Gary Black on Broadcom Earnings Broadcom spent plenty of time talking about their AI revenue during the third-quarter financial results and earnings call.

It’s the AI-related revenue that has Future Fund Managing Partner Gary Black expecting shares to rebound from the immediate negative reaction. "As the AI Rev strength becomes clearer to investors I expect the stock to recover somewhat," Black tweeted.

Black highlighted Broadcom CEO Hock Tan saying that AI chip demand is higher than what they can currently ship.

Third-quarter AI revenue of $16.7 billion was up 221% year-over-year and beat a Street consensus estimate of $15.9 billion.

Black also highlighted Broadcom’s guidance for fourth-quarter AI revenue to be $21.7 billion, which would be up 236% year-over-year.

That total is above a Street consensus estimate of $21.3 billion.

For fiscal 2026, Broadcom now sees AI revenue hitting $58 billion, up from a previous guide of $56 billion.

That total would be up 186% year-over-year.

The strength of the AI segment has Black excited, and is why he believes the stock drop in after-hours Wednesday was an overreaction.

Broadcom Stock Price Action Broadcom stock is down 6.7% to $342.61 on Thursday versus a 52-week trading range of $289.96 to $495.00.

Broadcom shares are currently up 1.4% year-to-date in 2026 and trading at levels last seen in April 2026.

Black expects a recovery soon, and investors may be patiently waiting to see how important the AI segment and future growth are for the company and its share price.

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