Broadcom Earnings Put AI Trade to the Test 02/09/2026
Market Wrap
U.S. stocks fell on Tuesday as a sharp rise in oil prices fueled inflation concerns and pushed bond yields higher, raising questions about whether the Federal Reserve could tighten monetary policy later this month.
The Dow Jones Industrial Average dropped 419 points, or 0.8%, to 52,766.88. The S&P 500 declined 0.7% to 7,631.47, while the Nasdaq Composite fell 1% to 26,099.77 as higher yields weighed on technology shares.
Energy markets remained at the center of attention as tensions between the U.S. and Iran intensified. U.S. forces launched fresh attacks on Iranian Revolutionary Guard targets, extending the renewed military confrontation that began over the weekend. WTI crude surged 5.2% to $90.22 a barrel, while Brent climbed 4.6% to $94.65.
Geopolitical risks have continued to build after a tanker traveling through the Strait of Hormuz was struck by unidentified projectiles on Monday. President Donald Trump also warned that the U.S. would respond forcefully to further Iranian attacks on American military bases in the region.
The surge in energy prices is complicating the outlook for central banks. Bond yields have been moving higher globally as investors consider whether sustained oil prices near current levels could reignite inflation and force the Fed to maintain a more restrictive policy stance. The central bank's next meeting is now roughly two weeks away.
The renewed pressure comes as Wall Street enters September, historically the weakest month for U.S. equities. Attention now turns back to the labor market, with ADP private payrolls due Wednesday. Investors will also monitor factory data and the Federal Reserve's Beige Book for further clues on economic conditions.
Corporate earnings will provide another catalyst after the close, with Hewlett Packard Enterprise (HPE), Snowflake (SNOW) and Broadcom (AVGO) scheduled to report.
Dell's AI Server Boom Drives Earnings Beat and Stronger Outlook
Dell Technologies (DELL) delivered a stronger-than-expected quarter as accelerating demand for AI infrastructure pushed server orders, revenue and backlog sharply higher.
The company reported $47 billion in quarterly revenue, up 58% from a year earlier and ahead of the $44.9 billion expected by analysts. Adjusted earnings reached $7.04 per share, well above the $4.91 consensus and more than triple the level recorded a year ago.
AI servers remained the standout. Dell booked $60.9 billion in AI server orders during the quarter, while revenue from the business doubled to $16.4 billion. The company ended the period with a $95 billion backlog, up sharply from $51.3 billion in the previous quarter.
Management expects the opportunity to expand further, forecasting that AI could account for roughly 75% of total data-center demand by the end of the decade and estimating a potential market of more than $1 trillion across cloud, sovereign and enterprise customers.
Strength was also visible beyond AI servers. Traditional server and networking revenue surged 122% to $10.5 billion, storage revenue increased 26% to $4.9 billion, and Dell's PC business grew 20% to $15 billion.
Dell also raised its outlook. The company now expects fiscal 2027 revenue of $192 billion, up from its previous $167 billion forecast and representing roughly 70% annual growth. Adjusted earnings are projected at $25.50 per share, while October-quarter revenue and earnings guidance also came in well above Wall Street expectations.
The results reinforce Dell's increasingly important role in the AI infrastructure buildout, with demand from Nvidia (NVDA)-powered systems and large-scale computing projects providing additional potential growth catalysts.
Stocks on the Move
- MongoDB (MDB): Shares dropped 12% despite stronger-than-expected second-quarter results and an upbeat outlook. The company reported adjusted earnings of $1.90 per share on $772 million in revenue, topping estimates of $1.61 and $734 million.
- Credo Technology (CRDO): Shares slipped nearly 4% as investors focused on a slightly weaker gross margin. First-quarter adjusted gross margin came in at 68%, just below the 68.3% consensus, although earnings and revenue both beat expectations.
- GitLab (GTLB): Shares surged nearly 20% after the software company beat second-quarter expectations and raised its full-year outlook. Adjusted earnings of 24 cents per share and revenue of $286 million both came in ahead of estimates.
- Palo Alto Networks (PANW): Shares were little changed despite better-than-expected fiscal fourth-quarter results. The cybersecurity company reported adjusted earnings of $1.02 per share on $3.41 billion in revenue, topping Wall Street expectations on both measures.
Watchlist: DELL, MDB, PANW, HPE, AVGO, CRDO, FCEL, COIN, XOM, MU, WDC, GOOGL, AAPL
Key Economic Events Today
Economic Data (EST)
- 08:15 AM — USD ADP Non-Farm Employment Change
- 10:00 AM — USD Factory Orders
- 10:30 AM — USD Crude Oil Inventories
- 02:00 PM — USD Beige Book
Earnings
Before Market Open: Sprinkle Inc (CXM), FuelCell Energy (FCE)
After Market Close: Broadcom Inc. (AVGO), Snowflake (SNOW), Hewlett Packard (HPE), NetApp (NTAP), Five Below (FIVE), C3.ai (AI)
