uploads///broadcom pixabay

Broadcom Cuts Revenue Guidance on Expected Weak Chip Demand


Jun. 15 2019, Updated 9:17 a.m. ET

Broadcom stock sinks

Broadcom (AVGO) stock fell ~8.5% after markets closed yesterday following the semiconductor giant’s fiscal 2019 second-quarter earnings release. It missed analysts’ revenue estimate and cut its fiscal 2019 (ending in October) revenue guidance by $2 billion to $22.5 billion due to sluggishness in its semiconductor solutions business.

Choppy demand for chips driven by US-China trade tensions weakened Broadcom’s revenue, as did the US government’s ban on Huawei Technologies. The company generated ~$900 million (4% of its overall sales) from Huawei last year.

Article continues below advertisement

Chip stocks fall on Broadcom’s forecast

Broadcom’s forecast of a demand slowdown pulled down chip stocks. Qorvo, Skyworks Solutions, Texas Instruments, NVIDIA, Micron Technology, Qualcomm, NXP Semiconductors, Advanced Micro Devices, and Marvell Technology fell 5.23%, 3.29%, 2.15%, 2.12%, 2.49%, 1.79%, 2.48%, 2.96%, and 2.27%, respectively, after market hours yesterday.

Broadcom stock closed 0.67% higher yesterday at $281.61. The stock has risen 11.74% this year, underperforming the S&P 500, NASDAQ Composite, and Dow Jones Industrial Average, which have risen 15.35%, 18.11%, and 11.91%, respectively.


More From Market Realist

  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.