Wall Street Breakfast Podcast: Broadcom Beat Meets High Hopes

Download this episode on Apple Podcasts/Spotify or listen below:

An earnings beat wasn’t enough to stop Broadcom (AVGO) from slipping. (00:14) The mystery of $7 ground beef has the DOJ’s attention. (01:36) Chipotle (CMG) is taking its burritos to Asia. (02:32)

This is an abridged transcript.

Broadcom (AVGO) is down 2.1% in premarket action after offering weaker-than-expected guidance that overshadowed its third-quarter results.

For the period ending Aug. 2, Broadcom said it earned an adjusted $3.32 per share as revenue soared 86% year-over-year to $29.59B.

Analysts had expected the company to earn an adjusted $3.23 per share on $29.45B in revenue.

Looking ahead, Broadcom said it expects fourth-quarter revenue to be approximately $34.8B, with adjusted EBITDA around 66%. Analysts had expected $35.1B in fourth-quarter sales, according to Bloomberg.

“Demand for our custom AI accelerators and networking continues to be very strong. Q3 AI semiconductor revenue of $16.7 billion grew 221% year-over-year, and 54% quarter-over-quarter,” said CEO Hock Tan in a statement. “In Q4 the momentum continues, and we expect AI semiconductor revenue to accelerate to $21.7 billion, up 236% year-over-year.”

Here’s a link to the transcript of the earnings call.

The U.S. Justice Department has widened its investigation into the meatpacking industry, requesting information from eight major grocery retailers as beef prices remain close to record levels.

The department said this week that Associate Attorney General Stanley Woodward sent letters last month to Amazon.com (AMZN), Costco Wholesale (COST), Walmart (WMT), Albertsons, Kroger (KR), Ahold Delhaize’s (ADRNY) U.S. business, Publix, and Aldi.

The requests cover six years of data on how the retailers buy beef, their purchasing strategies, retail prices, profit margins, and assessments of the market, according to the department.

The inquiry is part of a broader examination announced by the Justice Department in May into possible antitrust violations in the meatpacking sector.

Ground beef sold for an average of $7.116 per pound in July, according to the U.S. Bureau of Labor Statistics, remaining near its record despite a modest easing.

Chipotle Mexican Grill (CMG) announced the opening of its first restaurant in Asia. The new location is in Seoul, South Korea.

Chipotle (CMG) noted that South Korea was selected because it is seen as having highly engaged and discerning consumers, a sophisticated restaurant culture, and strong appreciation for authenticity and ingredient quality.

Chipotle plans to continue its expansion with two more locations in South Korea by the end of 2026, followed by its first restaurant in Singapore in 2027.

What’s Trending on Seeking Alpha:

Most shorted stocks on Wall Street

PG&E teams up with Google, Tesla, Sunrun on Bay Area virtual power plant

AI Exhaustion? 3 Healthcare Stocks With 38% EPS Growth That Could Be The Cure

Catalyst watch:

• Tesla (TSLA) will hold an invite-only Cybercab launch event in Austin, Texas. The Cybercab is the company’s purpose-built robotaxi that does not have a steering wheel or pedals. Reports indicate riders may be able to request the Cybercab through Tesla’s existing Robotaxi app in Austin.

• Match Group (MTCH) will hold an investor event hosted by CEO Spencer Rascoff to discuss the Tinder business.

Stock index futures are in mixed territory.

Crude oil is up 0.6% at $91. Brent crude is up 0.4% at $96.

The FTSE 100 is down 0.1% and the DAX is down 0.2%.

One stock on the biggest movers list: Snowflake (SNOW) +24% – Shares surged after the data warehousing company reported a strong fiscal Q2 and issued an upbeat outlook, with product revenue rising 37% Y/Y to $1.49B.

Economic calendar: