Broadcom (AVGO) will announce its fiscal second quarter 2025 financial results on June 5. While AVGO stock faced some pressure earlier this year amid concerns about an economic slowdown and tightened enterprise spending, it staged a solid recovery following a strong Q1 performance. Moreover, optimism grew as U.S.-China trade negotiations resulted in a temporary tariff truce, alleviating concerns about a recession.

Over the past month, Broadcom shares have surged more than 24%. With positive momentum building in AVGO stock ahead of Q2 earnings, let’s look at analysts’ Q2 earnings forecast.

Broadcom: Q2 Expectations

Broadcom’s Q2 is expected to benefit from strong tailwinds as demand for AI technologies continues to drive growth in its semiconductor and software businesses. The company’s growing footprint in artificial intelligence (AI) and a solid showing in infrastructure software, particularly following the VMware acquisition, are positioning it for another impressive quarter.

In the first quarter, Broadcom reported semiconductor revenue of $8.2 billion, marking an 11% increase from the previous year. A major contributor to this surge was the company’s AI-related revenue, which jumped 77% year-over-year to reach $4.1 billion. This growth was driven by robust shipments of networking solutions to hyperscalers.

Looking ahead, Broadcom projects total revenue of about $14.9 billion for Q2, reflecting a 19.3% jump from the same period last year. AI is once again expected to play a key role. The company anticipates $4.4 billion in AI-related revenue this quarter, representing a 44% year-over-year increase. This momentum is being fueled by continued demand from hyperscalers for Broadcom’s high-performance accelerators and networking solutions.

Management remains bullish on the long-term AI opportunity. The company believes its top three hyperscaler customers could continue to drive significant growth opportunities for the company. Moreover, Broadcom is also working with two additional hyperscalers to develop custom AI accelerators, which will further expand its addressable market.

Broadcom’s infrastructure software segment is becoming an increasingly important part of the growth story. Revenue from this division hit $6.7 billion in Q1, a 47% increase over the previous year. This growth was buoyed by Broadcom’s strategic shift from perpetual licenses to subscription-based models. The enterprise AI trend is also creating additional upside, as Broadcom’s VMware Private AI Foundation is gaining traction. Moreover, the growing adoption of VMware Cloud Foundation (VCF) presents new opportunities for cross-selling and product expansion.

For the second quarter, infrastructure software revenue is expected to come in at $6.5 billion, up 23% year-over-year.

That said, not all areas are firing on all cylinders. The company’s non-AI semiconductor segment is facing headwinds, particularly in enterprise networking, where customers are still working through existing inventory. However, improvements in the server storage business are expected to help offset some of the softness.

Even with those challenges, Broadcom’s consistent track record of exceeding expectations remains a point of confidence. The company has beaten Wall Street earnings forecasts for four consecutive quarters, including a 10.24% surprise in the most recent quarter.

For the upcoming Q2 report, analysts expect earnings per share of $1.35, representing a 55.17% increase from a year ago. This anticipated growth is supported by higher overall sales and a favorable revenue mix, with strength in both software and AI-related semiconductor products.

Broadcom Enhances Shareholder Value

Broadcom authorized a substantial $10 billion share repurchase program in April, slated to continue through Dec. 31, 2025. The move reflects management’s confidence in generating strong cash flows through its diverse semiconductor and infrastructure software portfolios. Specifically, Broadcom’s strong foothold in infrastructure software positions it well to support hyperscalers in integrating generative AI into their expanding subscriber platforms, which, in turn, will support its growth and enable the company to return higher cash to its shareholders.

Here’s What Wall Street Recommends for AVGO Stock

Wall Street analysts are bullish on AVGO stock ahead of Q2 earnings. AVGO stock has a consensus rating of “Strong Buy.” Its solid AI-driven growth and expanding software footprint will support its financials and share price.