Broadcom Q3 FY26 Earnings: Record Revenue and Explosive AI Growth

Broadcom Inc. (NASDAQ: AVGO) delivered an exceptionally strong third-quarter fiscal 2026 performance, with explosive growth in its semiconductor business driven by continued demand for AI infrastructure. With record-setting consolidated revenue, surging profitability, and strong cash generation, Broadcom continues to capitalize on the ongoing AI infrastructure boom.

Strong Financial Results Driven by AI Demand

For the third quarter of fiscal 2026, Broadcom generated revenue of $29.6 billion, representing an 86% increase from the same period last year. The growth was driven primarily by the company's semiconductor solutions, where revenue surged 127% year-over-year to $20.8 billion. Infrastructure software also continued to expand, with revenue rising 29% to $8.75 billion.

The most important driver, however, remains artificial intelligence. Broadcom reported AI semiconductor revenue of $16.7 billion during the quarter, up an extraordinary 221% from a year earlier and 54% from the previous quarter. Demand for custom AI accelerators and networking products continues to accelerate as cloud companies and hyperscalers expand their AI infrastructure.

Management expects this momentum to continue into the fourth quarter. Broadcom forecasts AI semiconductor revenue of $21.7 billion, representing 236% growth from the prior-year period.

Record Profitability and Free Cash Flow

GAAP gross margin came in at 69.1%, up from 67.1% a year ago — a 200 basis point improvement. GAAP operating margin surged to 53.9% from 36.9% — an extraordinary 1,700 basis point expansion, reflecting powerful operating leverage as revenue scaled.

Non-GAAP gross margin, however, declined to 75.0% from 78.4% — a 340 basis point contraction. Non-GAAP operating margin improved more modestly, from 65.5% to 67.9%.

GAAP operating income jumped 171% year-over-year to $16.0 billion, while non-GAAP operating income increased 92% to $20.1 billion. GAAP net income more than tripled, rising 216% to $13.1 billion.

GAAP diluted earnings per share increased to $2.68 from $0.85 in the prior-year quarter, while non-GAAP diluted EPS rose 96% to $3.32.

Cash flow from operations reached $14.2 billion during the quarter. After spending approximately $0.5 billion on capital expenditures, Broadcom generated $13.7 billion in free cash flow. That means free cash flow represented 46% of quarterly revenue.

At the end of the quarter, Broadcom held $24.0 billion in cash and cash equivalents, while total debt stood at approximately $59.4 billion.

Broadcom also continued to return capital to shareholders. On June 30, 2026, the company paid a cash dividend of $0.65 per share, totaling $3.1 billion. Marvell Technology, as Boardcom's competitor, recently released its Q2 FY27 financial results; for more information visit: Marvell Technology: AI Momentum Accelerates Q2 FY27 Results and Upward Guidance.

Q4 FY26 Guidance

Broadcom guided Q4 FY26 revenue to approximately $34.8 billion, up 93% year-over-year, and Non-GAAP operating income to roughly 66% of projected revenue — flat with the prior year period.

AVGO Stock Technical Analysis

For AVGO stock, the key near-term level remains $398. A successful break and sustained move above this resistance could create an opportunity for a move toward $430.

However, if the stock fails to clear or hold above the $398 resistance, it may retest lower demand zones. The primary support level to monitor is $320. A breakdown below $320 could lead to further downside toward a secondary, deeper support zone at $290.