Broadcom’s Q1 2025 financial report showed a 25% rise in revenue and a 316% surge in net profit year-on-year, driven by increased earnings from artificial intelligence (AI)-based technologies and the successful expansion of its software business. This reflects sustained strong demand for AI chips, the successful integration of VMware, and improved operational efficiency. Investors responded positively to the robust results and the optimistic outlook for Q2, leading to a rise in Broadcom’s share price.
This article examines Broadcom, Inc., breaks down its revenue streams, reviews its Q1 2025 performance, and outlines expectations for 2025. A technical analysis of AVGO is also provided, forming the basis for the 2025 Broadcom stock forecast.
About Broadcom, Inc.
Broadcom, Inc. is a US-based technology company specialising in developing chips for networking equipment, servers, data centres, wireless communications, and software for cloud and enterprise solutions. Founded in 1961 as a division of HP, it was spun off as Avago Technologies in 1991. In 2009, Avago Technologies went public on NASDAQ, and its shares have been traded under the ticker AVGO ever since. In 2016, Avago Technologies acquired Broadcom Corporation for 37.0 billion USD and adopted its name.
Broadcom, Inc.’s main revenue streams
Broadcom’s revenue is divided into two main segments:
- Semiconductor business – Approximately 75% of revenue is derived from the sale of chips for data centres, cloud computing, AI accelerators, network processors, and chips for servers, storage, networking equipment, and wireless modules for smartphones and Wi-Fi.
- Infrastructure software – The remaining 25% of revenue comes from enterprise software for cloud computing, cybersecurity and networking solutions, VMware products, automation components, and DevOps platforms.
Broadcom, Inc. Q4 2024 report
Broadcom released its financial report for Q1 2025 on 6 March, covering the financial year that ended on 2 February 2025. The key figures are as follows:
- Revenue: 14.9 billion USD (+25%)
- Net profit: 5.5 billion USD (+316%)
- Earnings per share (EPS): 1.14 USD (+307%)
- Operating profit: 6.2 billion USD (+198%)
Net revenue by segment:
- Semiconductor solutions: 8.2 billion USD (+55%)
- Infrastructure software: 6.7 billion USD (+47%)
Broadcom reported strong financial results for Q1 2025, with revenue rising by 25% year-on-year. This growth was primarily driven by a 77% increase in AI-related revenue, which reached 4.1 billion USD, and a 47% rise in infrastructure software revenue, totalling 6.7 billion USD. The successful integration of VMware, acquired in 2023, also played a significant role in this expansion, strengthening Broadcom’s position in the enterprise software market.
CEO Hock Tan highlighted the strong demand for custom AI chips from cloud computing giants, which heavily invest in AI-driven data centres.
Looking ahead to Q2 2025, Broadcom expects revenue to reach 14.9 billion USD, slightly above analysts’ estimates. The company anticipates further growth in the AI semiconductor segment, with AI-related revenue projected to increase to 4.4 billion USD in the next quarter.
Expert forecasts for Broadcom, Inc. stock
- Barchart: 30 out of 33 analysts rated Broadcom shares as a Strong Buy, with 3 rating them as Hold. The highest target price for the shares is 300 USD
- MarketBeat: 24 out of 26 experts assigned a Buy rating to the stock, with two recommending Hold. The highest target price for the shares is 260 USD
- TipRanks: 23 out of 25 analysts gave the stock a Buy rating, with two recommending Hold. The highest target price for the shares is 267 USD
- Stock Analysis: 11 out of 29 experts rated the stock as a Strong Buy, 10 as Buy, seven as Hold, and one as Sell. The highest target price for the shares is 250 USD
Broadcom, Inc. stock price forecast for 2025
The launch of the latest version of DeepSeek on 27 January 2025 triggered a decline in the stocks of US tech companies involved in AI development. Against this backdrop, Broadcom’s shares, which had reached an all-time high of 250 USD, fell by 17%. Although the stock regained some of its losses, prices began sliding again on 10 February. It was the release of the report that ultimately halted the decline. Based on the current dynamics of Broadcom’s shares, the potential price movements for 2025 are as follows:
The primary forecast for Broadcom, Inc. shares suggests a bounce from the support level at 184 USD, followed by a rise towards the all-time high of 250 USD. This is supported by the company’s optimistic outlook for the next quarter and the continued growth of the AI market.
An alternative forecast for Broadcom, Inc. stock predicts further decline, with the price potentially dropping to the next support level at 160 USD. This scenario would indicate increasing competition from Chinese companies and heightened tensions in the trade war between the US and China. In this case, a break below the 160 USD support level could lead to a further drop to 140 USD.
Broadcom, Inc. stock analysis and forecast for 2025
Risks of investing in Broadcom, Inc. stock
When investing in Broadcom’s stock, it is essential to consider the risks the company may face. Below are the key events that could negatively impact Broadcom’s revenue:
- A slowdown in artificial intelligence spending: as AI is a key growth driver, any reduction in spending due to market saturation, an economic downturn, or shifting priorities could directly affect semiconductor revenue. Although investor expectations for AI-related growth are high, slower-than-expected progress could undermine investor confidence and earnings forecasts
- Dependence on key clients: CEO Hock Tan has mentioned three major cloud clients developing their own AI chips. If these companies succeed, their reduced reliance on Broadcom could harm the profitability of its semiconductor segment
- Geopolitical and trade risks: Broadcom is exposed to risks from escalating trade tensions between the US and China. Potential tariffs under the Trump administration or export restrictions on AI chips to China could disrupt supply chains or limit access to traditional markets
- Competition in the semiconductor sector: Broadcom faces competitive pressures from companies like AMD and NVIDIA in the AI and networking solutions space. NVIDIA’s dominance in AI GPUs and the potential revival of Intel (with Broadcom reportedly interested in its chip business) could reduce Broadcom’s market share
Summary
Broadcom Inc.’s Q1 2025 financial report shows the company is set for a promising year, thanks to strong results in artificial intelligence and infrastructure software. The growth in revenue and net income indicates that Broadcom is successfully capitalising on the high demand for AI products, mainly from large-scale clients building advanced data centres. The acquisition of VMware continues to bear fruit, increasing infrastructure software revenue by 47% and strengthening Broadcom’s position as a leader in corporate applications and virtualisation.
The company’s Q2 2025 forecast of 14.9 billion USD reflects confidence in continuing the current trends. In 2025, Broadcom can expect further growth driven by the active adoption of AI, deeper integration of VMware offerings, and potential increases in market share in networking technologies and semiconductors. This growth will be particularly achievable if the company continues its innovations and strengthens ties with key cloud partners. With macroeconomic stability, Broadcom’s strategic focus on rapidly growing market segments will likely ensure its success.
Source: Roboforex
