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Broadcom’s AI Surge and New Mega Order Lift Outlook as HPE Raises Guidance on Server and Networking Strength

Surging generative‑AI infrastructure demand is reshaping hardware and software vendors’ revenue mix.

A Broadcom logo and a computer motherboard appear in this illustration taken August 25, 2025. REUTERS/Dado Ruvic/Illustration
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Overview

  • Broadcom posted record fiscal Q3 revenue of $15.95 billion and adjusted EPS of $1.69, with AI sales up 63% year over year to $5.2 billion.
  • CEO Hock Tan said a new customer placed more than $10 billion in AI infrastructure orders, prompting a much stronger fiscal 2026 AI outlook.
  • Broadcom guided to roughly $17.4 billion in Q4 revenue and about $6.2 billion in AI semiconductor sales, while noting non‑AI chip areas were softer.
  • Tan acknowledged many VMware Cloud Foundation subscriptions are not fully deployed, highlighting significant shelfware the company aims to convert into active implementations and advanced services.
  • HPE beat Q3 expectations with $9.13–$9.14 billion in revenue, grew servers 16% and networking 54%, completed the Juniper deal, and raised full‑year revenue and EPS guidance with Q4 sales projected at $9.7–$10.1 billion.