European semiconductor stocks fell on Thursday after Broadcom held its $100 billion artificial intelligence revenue forecast unchanged, disappointing investors and sending the U.S. chipmaker’s shares down more than 13% in premarket trading.

Nokia shares slumped more than 9% by 09:23 GMT, while STMicroelectronics, Infineon, ASML and ASM fell between 2% and 6%. 

Broadcom posted fiscal second-quarter revenue of $22.2 billion and earnings per share of $2.44, edging past Wall Street estimates of $22.1 billion and $2.39. AI semiconductor revenue rose 143% year-over-year to $10.8 billion, topping expectations.

But the company kept its fiscal 2027 target of $100 billion in AI revenues, disappointing investors who had anticipated an upgrade given the strength of its custom chip programs.

For the current quarter, Broadcom guided for revenue of roughly $29.4 billion, above consensus estimates of $28.6 billion, though AI chip revenue guidance of $16 billion came in below the street’s $17.2 billion forecast.

Gross margins are expected to decline around 300 basis points to roughly 74%, reflecting a richer mix of custom accelerator chips.

Bernstein analyst Stacy Rasgon, who raised his price target to $550 from $525, said the guidance shortfall on AI was not entirely surprising.

“AI revenues can of course be lumpy. But coupled with the company’s decision to reiterate, rather than raise, their FY27 $100B AI guidance the stock took a hit in the aftermarket,” he wrote.

“We suspect the shares may take a pause for the next couple of quarters. But the story gets interesting again once we enter 2027,” he added.

“At the end of the day we have a company growing revenues and EPS >50%, with gross/operating margins in the 70s/60s, and potentially trading at a teens P/FE in an environment that is only getting stronger.”

BofA Securities analyst Vivek Arya, who raised his price target to $530 from $450, struck a more constructive tone on the AI pipeline, noting that Broadcom’s visibility now extends into 2028 across multiple new customers including Anthropic, Meta and OpenAI.

He called management’s decision not to raise the $100 billion guidance “a sign of conservatism given ongoing supply constraints at customers.”