Broadcom earnings could breathe new life into the chip rally

Some of the top chipmakers paused their spectacular rally on Wednesday, but analysts are expecting big things from Broadcom , which reports earnings after the close. Hyperscalers rely heavily on Broadcom's application-specific integrated circuits, or ASICs, and the company has deals with frontier software companies Anthropic and OpenAI, so signs of strong demand could translate to the chipmaking sector as a whole. Broadcom is expected to hit second-quarter earnings per share of $2.40 and revenue of $22.13 billion, according to FactSet, but analysts think estimates are surmountable. "Street estimates look very beatable over the next few quarters with AVGO likely guiding revenue well ahead of Street ~$22B," UBS analyst Timothy Arcuri wrote in a May 18 earnings preview. Arcuri has a buy rating on the stock with an improved price target of $490. Shares of Broadcom have been on a tear, up 40% in 2026 and besting chip giant Nvidia, which is only up about 15% this year. The CNBC Magnificent 7 index is toting a 2026 gain just shy of 4%. Broadcom shares are also poised to move as much as 8% after results, based on options activity. AVGO YTD mountain Broadcom in 2026 Broadcom stock was up about 1% at $487 per share Wednesday afternoon. Nvidia was down a little over 3% and Micron shares were flat while the PHLX Semiconductor index was up almost 2%. …