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ETFs to Buy as Broadcom Shares Jump 5% After Q1 Earnings Beat
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Key Takeaways
AVGO jumped nearly 5% after Q1 results as revenues climbed 29% YoY on strong AI semiconductor demand.
SOXQ and SOXX offer notable exposure to Broadcom, where the chipmaker ranks among the top holdings.
FTEC gives investors diversified exposure to 289 U.S. tech companies, including Broadcom.
Shares of Broadcom Inc. (AVGO - Free Report) jumped nearly 5% in the extended trading hours on March 4, 2026, (as cited in CNBC) following the company’s upbeat first-quarter fiscal 2026 results. The company, set to achieve AI revenues from chips in excess of $100 billion in 2027, as mentioned by its CEO on its earnings call, must have impressed investors, which was duly reflected in the chipmaker’s gain in the after-hours trading session.
The company’s fiscal second-quarter revenue guidance also came in better than Wall Street’s $20.53 billion.
Against this backdrop, investors interested in this tech leader, as well as wanting to gain exposure to the AI industry, might want to add AVGO to their portfolio.
However, one must be mindful of the fact that investing in a single stock comes with its share of risk. For instance, in the case of AVGO, these risks come in the form of high customer concentration in its custom AI chip business, with a large portion of revenues coming from a handful of hyperscale clients. This creates high revenue volatility if any major customer shifts to in-house chip development or slows orders.
Therefore, for investors looking to capitalize on AVGO’s better-than-expected revenue growth from its AI business without being fully exposed to the company-specific challenges, a more prudent strategy would be to invest in exchange-traded funds (ETFs) with significant exposure to this chipmaker. This approach should help mitigate risks from customer concentration—such as Broadcom's reliance on a handful of hyperscale clients—or geopolitical factors like recent government scrutiny of its customer Anthropic.
But before diving straight into these ETFs, let us review AVGO’s overall performance in the fiscal first quarter.
A Brief Analysis of AVGO’s Q1 Results
Broadcom’s first-quarter fiscal 2026 adjusted earnings per share surpassed the Zacks Consensus Estimate by 1% and surged 28.1% year over year. Its revenues rose 29% year over year and beat the consensus mark by a whisker.
The double-digit top-line growth was primarily driven by better-than-expected growth in AI semiconductors.
In its non-AI semiconductor business, the company witnessed flattish year-over-year growth, as revenue growth in enterprise networking, broadband, and server storage was offset by a seasonal decline in wireless.
AVGO ended the fiscal first quarter with an inventory of $3 billion as it continued to secure components to support strong AI demand. In the interest of its shareholders, it is imperative to mention that Broadcom returned $10.9 billion to its equity holders through dividends and share repurchases.
AVGO expects to generate consolidated revenues of approximately $22 billion in the fiscal second quarter, which represents 47% year-on-year growth. The Zacks Consensus Estimate is pegged at $20.44 billion.
In particular, Broadcom estimates its AI semiconductor business to witness accelerated momentum in the ongoing fiscal quarter, with semiconductor revenues projected to be $14.8 billion. This reflects a surge of 76% year on year.
As far as AVGO’s customers are concerned, the company expects to witness demand worth 1 gigawatt (GW) of TPU compute from Anthropic in 2026, which is estimated to surge in excess of 3 GW next year.
From Google, AVGO expects to witness strong demand for its seventh-generation Ironwood TPU this year.
This fund, with a market value worth $1.02 billion, offers exposure to the 31 largest U.S.-listed securities of companies engaged in the semiconductor business. Of these, AVGO holds the second spot, with a 7.02% share of the fund.
The fund charges 19 basis points (bps) as fees and sports a Zacks ETF Rank #1 (Strong Buy). It traded at a good volume of 1.62 million shares in the last trading session.
This fund, with net assets worth $45.04 billion, provides exposure to 26 companies involved in semiconductor production and equipment. Of these, AVGO holds the third spot, with a 7.04% share of the fund.
The fund charges 35 bps as fees and sports a Zacks ETF Rank #1. It traded at a good volume of 8.74 million shares in the last trading session.
This fund, with net assets worth $21.44 billion, offers exposure to 30 U.S. companies that design, manufacture, and distribute semiconductors. Of these, AVGO holds the fifth spot, with a 5.45% share of the fund.
The fund charges 34 bps as fees and sports a Zacks ETF Rank #1. It traded at a good volume of 10.64 million shares in the last trading session.
Fidelity MSCI Information Technology Index ETF (FTEC - Free Report)
This fund, with net assets worth $15.96 billion, provides exposure to 289 U.S. information technology companies. Of these, AVGO holds the fourth spot, with a 4.27% share of the fund.
The fund charges 8 bps as fees and sports a Zacks ETF Rank 1. It traded at a volume of 0.44 million shares in the last trading session.
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ETFs to Buy as Broadcom Shares Jump 5% After Q1 Earnings Beat
Key Takeaways
Shares of Broadcom Inc. (AVGO - Free Report) jumped nearly 5% in the extended trading hours on March 4, 2026, (as cited in CNBC) following the company’s upbeat first-quarter fiscal 2026 results. The company, set to achieve AI revenues from chips in excess of $100 billion in 2027, as mentioned by its CEO on its earnings call, must have impressed investors, which was duly reflected in the chipmaker’s gain in the after-hours trading session.
The company’s fiscal second-quarter revenue guidance also came in better than Wall Street’s $20.53 billion.
Against this backdrop, investors interested in this tech leader, as well as wanting to gain exposure to the AI industry, might want to add AVGO to their portfolio.
However, one must be mindful of the fact that investing in a single stock comes with its share of risk. For instance, in the case of AVGO, these risks come in the form of high customer concentration in its custom AI chip business, with a large portion of revenues coming from a handful of hyperscale clients. This creates high revenue volatility if any major customer shifts to in-house chip development or slows orders.
Therefore, for investors looking to capitalize on AVGO’s better-than-expected revenue growth from its AI business without being fully exposed to the company-specific challenges, a more prudent strategy would be to invest in exchange-traded funds (ETFs) with significant exposure to this chipmaker. This approach should help mitigate risks from customer concentration—such as Broadcom's reliance on a handful of hyperscale clients—or geopolitical factors like recent government scrutiny of its customer Anthropic.
But before diving straight into these ETFs, let us review AVGO’s overall performance in the fiscal first quarter.
A Brief Analysis of AVGO’s Q1 Results
Broadcom’s first-quarter fiscal 2026 adjusted earnings per share surpassed the Zacks Consensus Estimate by 1% and surged 28.1% year over year. Its revenues rose 29% year over year and beat the consensus mark by a whisker.
The double-digit top-line growth was primarily driven by better-than-expected growth in AI semiconductors.
In its non-AI semiconductor business, the company witnessed flattish year-over-year growth, as revenue growth in enterprise networking, broadband, and server storage was offset by a seasonal decline in wireless.
AVGO ended the fiscal first quarter with an inventory of $3 billion as it continued to secure components to support strong AI demand.
In the interest of its shareholders, it is imperative to mention that Broadcom returned $10.9 billion to its equity holders through dividends and share repurchases.
AVGO expects to generate consolidated revenues of approximately $22 billion in the fiscal second quarter, which represents 47% year-on-year growth. The Zacks Consensus Estimate is pegged at $20.44 billion.
In particular, Broadcom estimates its AI semiconductor business to witness accelerated momentum in the ongoing fiscal quarter, with semiconductor revenues projected to be $14.8 billion. This reflects a surge of 76% year on year.
As far as AVGO’s customers are concerned, the company expects to witness demand worth 1 gigawatt (GW) of TPU compute from Anthropic in 2026, which is estimated to surge in excess of 3 GW next year.
From Google, AVGO expects to witness strong demand for its seventh-generation Ironwood TPU this year.
Broadcom-Heavy ETFs to Buy
Invesco PHLX Semiconductor ETF (SOXQ - Free Report)
This fund, with a market value worth $1.02 billion, offers exposure to the 31 largest U.S.-listed securities of companies engaged in the semiconductor business. Of these, AVGO holds the second spot, with a 7.02% share of the fund.
The fund charges 19 basis points (bps) as fees and sports a Zacks ETF Rank #1 (Strong Buy). It traded at a good volume of 1.62 million shares in the last trading session.
VanEck Semiconductor ETF (SMH - Free Report)
This fund, with net assets worth $45.04 billion, provides exposure to 26 companies involved in semiconductor production and equipment. Of these, AVGO holds the third spot, with a 7.04% share of the fund.
The fund charges 35 bps as fees and sports a Zacks ETF Rank #1. It traded at a good volume of 8.74 million shares in the last trading session.
iShares Semiconductor ETF (SOXX - Free Report)
This fund, with net assets worth $21.44 billion, offers exposure to 30 U.S. companies that design, manufacture, and distribute semiconductors. Of these, AVGO holds the fifth spot, with a 5.45% share of the fund.
The fund charges 34 bps as fees and sports a Zacks ETF Rank #1. It traded at a good volume of 10.64 million shares in the last trading session.
Fidelity MSCI Information Technology Index ETF (FTEC - Free Report)
This fund, with net assets worth $15.96 billion, provides exposure to 289 U.S. information technology companies. Of these, AVGO holds the fourth spot, with a 4.27% share of the fund.
The fund charges 8 bps as fees and sports a Zacks ETF Rank 1. It traded at a volume of 0.44 million shares in the last trading session.