Broadcom’s Stock Whiplash

Motley Fool Hidden Gems Investing

The Motley Fool

Investing, Business

4.3 • 3.1K Ratings

🗓️ 4 June 2026

⏱️ 28 minutes

🔗️ Recording | iTunes | RSS

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Summary

It seems like no matter the size of a company, it is possible we’ll see a double-digit percentage move in its stock on an earnings release. Today, it was Broadcom's turn to drop nearly 15% after the company reported what look like solid numbers. But when it comes to quarterly earnings, it’s all about the expectations game. Today’s move was clear that expectations are high for AI. Plus, stocks bucking their sector trends and how these mega IPOs will impact indices. Tyler Crowe, Matt Frankel, and Lou Whiteman discuss: - Broadcom’s good earnings - Playing the expectations game in a volatile market. - Stocks doing well in downtrodden industries - Listener questions: How will the Spacex, Anthropic, and OpenAI IPOs impact cash on the sidelines and ETFs? Companies discussed: AVGO, NVDA, TSMC, RHP, XPO, ODFL, OSCR Host: Tyler Crowe Guests: Matt Frankel, Lou Whiteman Engineer: Dan Boyd Disclosure: Advertisements are sponsored content and provided for informational purposes only. The Motley Fool and its affiliates (collectively, “TMF”) do not endorse, recommend, or verify the accuracy or completeness of the statements made within advertisements. TMF is not involved in the offer, sale, or solicitation of any securities advertised herein and makes no representations regarding the suitability, or risks associated with any investment opportunity presented. Investors should conduct their own due diligence and consult with legal, tax, and financial advisors before making any investment decisions. TMF assumes no responsibility for any losses or damages arising from this advertisement.We’re committed to transparency: All personal opinions in advertisements from Fools are their own. The product advertised in this episode was loaned to TMF and was returned after a test period or the product advertised in this episode was purchased by TMF. Advertiser has paid for the sponsorship of this episode.Learn more about your ad choices. Visit ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	We've got Broadcom Stock Whiplash. Today, on Motley Fool Hidden Gems Investing.
0:07.0	Welcome to Motley Full Hidden Gems Investing. I'm your host, Tyler Crowe, and today I'm joined
0:13.7	by longtime pool contributors, Lou Whiteman and Matt Frankel. Today we were going to do a little,
0:18.7	kind of mix it up a little bit. We thought we're going to do a bunch of different segments and, you know, do some basically non-earnings takes because it's June. We don't normally get a lot of surprise earning stuff, but then Broadcom had to go and give its earnings and now it stocks down, I think, almost 15% as we are taping today. As we're going to get into it, I'll let you guys really digest the numbers
0:38.8	here, but by all objective metrics, all the numbers looked good. The guidance looked fine.
0:45.9	Is this really just expectations, Game, Lou? Yeah, I think it is. Expectations are everything,
0:51.1	right? It's glass hat full, glass empty. Stock is up 15% just heading into earnings. When you get that sort of expectations, any slight hiccup, any slight sneeze can set you back. This was a slight miss on revenue. But, you know, look, it's brutal when people are expecting enough. Apparently, it was enough to outweigh 140% gains in AI semiconductors sales, which I don't know, Tyler, sounds pretty okay to me.
1:18.8	Yeah, Matt, you were the kind of task a little bit more with the nitty gritty of the numbers here.
1:23.8	What did you see in this that was like maybe not great? I don't know. It's it's kind of hard to
1:30.0	look at these and say, yeah, we should definitely be dropping the stock by 15% because that's just what we do
1:35.9	these days. Yeah. It's not only Broadcom. Crowdstrike also reported. We're getting all the reports
1:41.6	from companies that use weird fiscal years, and some of them
1:44.7	haven't been too impressive. But there was a lot to like here. Forty-eight percent revenue growth.
1:49.0	They beat on the bottom line. As Lou said, 140 percent roughly growth in AI semiconductor revenue.
1:55.0	The guidance was strong, but if you look into the guidance, the AI revenue that they're
1:59.8	guiding for is not quite
2:01.1	what the market expected, so that could be driving a little bit of the sell-off. Any slowdown in
2:06.2	AI or perceived slowdown is enough to scare investors. And it's not just that it was running up
2:11.2	15% heading into earnings. Broadcom was up 90% over the past year. So in a nutshell, the stock went into the report priced for a blowout quarter and blowout
2:21.8	guidance.
2:22.4	And it was a good quarter.
2:23.6	I wouldn't call this a blowout quarter, especially on the AI side of the business,
	...

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