Broadcom Shares Surge Amid Speculation of Major Partnership and Upcoming Earnings

As Broadcom prepares to release its quarterly results this Thursday, market attention is intensely focused on the semiconductor giant. A potent mix of rumors regarding a strategic shift by Microsoft and a series of bullish analyst revisions has injected significant momentum into the stock, which has already climbed approximately 48% year-to-date. Investors are now keen to see if the company's financials will substantiate its prominent role in the artificial intelligence growth narrative.

Confidence on Wall Street has visibly increased ahead of the publication of Broadcom's Q4 fiscal 2025 report. In a notable show of optimism, earnings estimates have been revised upward 27 times over the past 90 days. The consensus among market experts points to a substantial revenue leap to around $17.5 billion, fueled by intense demand for AI networking solutions and custom semiconductors. Furthermore, earnings per share (EPS) are projected to show impressive year-over-year growth of over 30%, reaching approximately $1.87.

Several investment firms have already adjusted their outlooks in response. Analysts at Jefferies recently raised their price target to $480, while Mizuho Securities emphasized the company's strong revenue projections within its AI segment.

Should investors sell immediately? Or is it worth buying Broadcom?

Rumored Microsoft Deal Fuels Investor Optimism

The current wave of positive sentiment is largely driven by a report from The Information, suggesting Microsoft is in talks to move its custom silicon business to Broadcom. This development would mark a significant shift, as the software behemoth has historically collaborated closely with Marvell Technology for these specialized chips. Securing such a partnership would represent a major win for Broadcom's Application-Specific Integrated Circuit (ASIC) division and would further solidify its commanding position in serving hyperscale data center operators.

This speculation aligns with a string of favorable news from the AI sector. The recent launch of Google's Gemini 3 AI model, which was trained on Tensor Processing Units (TPUs) co-developed with Broadcom, serves as a testament to the company's technological leadership. Additionally, persistent industry reports about a potential supply agreement for AI accelerators with OpenAI continue to bolster the long-term growth thesis for Broadcom.

Thursday's Report Pivotal for Market Direction

All eyes are on the upcoming earnings release scheduled for Thursday, December 11. Market participants will scrutinize whether the company's AI-related revenue can surpass the previously stated annual run-rate hurdle of $12 billion. Any concrete commentary from management regarding the rumored collaboration with Microsoft will also be a key focus. With the options market pricing in potential post-earnings volatility of about 8%, significant share price movement is anticipated following the announcement.