New York, Feb 18, 2026, 17:41 (EST) — After-hours
- Broadcom ended Wednesday up roughly 0.3%, with shares barely moving after hours.
- Citi cut its price target on Broadcom before the chip giant’s March 4 results, though the firm stuck with its buy rating.
- Meta just locked in a new multiyear AI hardware agreement with Nvidia, putting the spotlight back on the question: can custom chips really loosen Nvidia’s hold?
Broadcom Inc. shares edged up in late Wednesday trading, even as Citi trimmed its price target just before the company’s March 4 earnings. The market also digested news of a fresh Meta-Nvidia AI infrastructure deal, fueling debate over the winners and those under pressure as Big Tech ramps up chip purchases.
Timing is key here—Broadcom is caught between two forces shaping its shares. On one side, there’s the ongoing rush for AI data-center gear. On the other, large clients are working to reduce their dependence on Nvidia, turning to custom or in-house chips instead.
Another pain point has surfaced. Customers are taking a hard look at Broadcom’s VMware software unit—known for its virtualization tools that function as core infrastructure for many businesses—and some aren’t happy about higher licensing costs, weighing other options as scrutiny mounts.
Broadcom finished the session 0.3% higher at $333.51. Shares swung between $326.68 and $337.85 during the day, market data showed.
Atif Malik at Citi trimmed his price target on Broadcom to $458, down from $480, while maintaining a buy call, TheFly reported. Concerns over gross margin—the chunk of revenue after costs—plus Google’s Tensor Processing Unit (TPU) competition and the company’s software-linked risks, are mostly baked into the shares now, Citi noted.
Nvidia said Tuesday it’s teaming up with Meta in a multiyear deal, one that will see Meta roll out “millions” of Nvidia’s Blackwell and Rubin GPUs, plus Grace and Vera CPUs and Spectrum-X Ethernet switches. Meta CEO Mark Zuckerberg, quoted in Nvidia’s announcement, said the firms plan to create clusters with Nvidia’s “Vera Rubin platform,” targeting what he called “personal superintelligence.” NVIDIA Newsroom
Meta’s new step comes as investors look for options beyond Nvidia. Back in November, The Information said Meta was discussing a multibillion-dollar chip deal with Google, aiming to start using Alphabet’s chips in its data centers by 2027. That arrangement would put the spotlight on Google’s own TPU chips, built together with Broadcom.
A CloudBolt survey highlighted by CIO found 86% of North American enterprises surveyed in January were cutting back on VMware. Still, just 14% reported their prices had actually doubled so far. Scott Bickley, advisory fellow at Info-Tech Research Group, told CIO Broadcom may only need to retain its top 10,000 VMware customers to hit revenue and profit targets over the next three years.
Still, the downside looms. Back in December, Broadcom flagged that a higher proportion of lower-margin AI chip sales could squeeze gross margin—even though appetite for AI hardware keeps climbing. It’s a trade-off that’s left results swinging more wildly when expectations surge.
Broadcom is set to report its fiscal first-quarter 2026 numbers after the U.S. market closes on March 4, with the conference call scheduled for 5 p.m. ET, according to the company. The focus will be on what management says about AI chip demand, the latest on gross margins, and VMware renewal progress heading into next quarter.
