Broadcom sell-off shows signs of easing after earnings
Broadcom’s post-earnings decline may be losing momentum, with buying volume improving even as the shares remain below key moving averages and momentum indicators stay negative.
Broadcom Inc. shares came under pressure after the company reported third-quarter results and gave fourth-quarter revenue guidance that fell short of expectations. The sell-off accelerated after CEO Hock Tan said Broadcom’s AI revenue opportunity could reach $230 billion by fiscal 2028, up from about $20 billion in fiscal 2025. Tan also said on the earnings call that whether shipped chips are deployed on a timely basis remains very much in our mind when the company gives long-term forecasts, reflecting concern that power shortages could delay AI infrastructure deployments.
Management did not signal weakening customer demand. Instead, it said some AI systems may take longer to come online because data center power capacity is struggling to keep pace with the industry’s rapid expansion. Broadcom is trading below both its 50-day and 200-day moving averages, leaving the broader trend under pressure. Momentum gauges such as the MACD remain negative, indicating the stock has not yet established a clear bottom.
Buying volume has improved in recent sessions even as the stock has declined, suggesting investors have been accumulating shares on weakness. The Relative Strength Index has fallen to around 37, a level that can suggest selling pressure is becoming stretched. The signals do not confirm a reversal, but they point to fading downside momentum rather than accelerating weakness. Investor focus remains on expectations rather than business fundamentals.
Broadcom continues to benefit from robust AI demand, but market participants are reassessing how quickly that demand can be converted into deployed infrastructure and revenue. The next signal may come less from another earnings headline than from the stock itself. If buying volume keeps strengthening and Broadcom starts reclaiming key moving averages, that would suggest the market is looking past near-term deployment concerns and refocusing on the company’s long-term AI opportunity. For now, the chart provides an early clue, not confirmation, that the post-earnings sell-off may be losing momentum.