Chip stocks were trading mostly lower Friday after Broadcom Inc (NASDAQ:AVGO) issued a concerning second-quarter earnings report and cautious outlook.

What Happened

On Thursday, Broadcom said it earned $5.21 per share in the second quarter on revenue of $5.517 billion. Street analysts were expecting the company to earn $5.18 per share on revenue of $5.69 billion.

On top of a the second-quarter revenue miss, Broadcom revised its full-year revenue outlook from $24.5 billion to $22.5 billion. The chipmaker cited a "broad-based slowdown in the demand environment" due to continued geopolitical uncertainties. The company also highlighted the "effects of export restrictions" on one of its largest customers — most likely China-based Huawei.

Why It's Important

Broadcom CEO Hock Tan said during the company's post-earnings conference call the chip environment is "very, very nervous."

In a Tweet, CNBC's Jim Cramer wrote the conference call was "truly depressing" and "not good for the group."

What's Next

Broadcom said its customers are "actively reducing" their inventory levels. As a result, the company said it's now "taking a conservative stance" for the rest of the year.

Price Action

The following is a summary of how notable chip stocks were trading at the time of publication Friday: 

• Broadcom: down 7.09%. 
• Skyworks Solutions Inc (NASDAQ:SWKS): down 3.86%.
• Analog Devices, Inc. (NASDAQ:ADI): down 2.53%. 
• Xilinx, Inc. (NASDAQ:XLNX): down 2.54%. 
• Micron Technology, Inc. (NASDAQ:MU): down 2.97%.
• Texas Instruments Incorporated (NASDAQ:TXN): down 3.41%.
• Advanced Micro Devices, Inc. (NASDAQ:AMD): down 3.79%.
• Nvidia Corporation (NASDAQ:NVDA): down 3.43%.
• Qualcomm, Inc. (NASDAQ:QCOM): down 2.06%.

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