The Freedom 90 had been en route from Ryde to Southsea on Saturday evening when the "major fault" occurred, forcing it to return to the island.
Images appear to show a red rudder hanging off the back of the craft.
Operator Hovertravel cancelled all services on both of its vessels while safety checks were carried out.
Its unaffected craft resumed service at 16:15 on Sunday on a revised timetable.
The damaged vessel is due to be moved to Woolston in Southampton for repair work.
A spokesman said: "An initial investigation into the propeller damage on Freedom 90 indicates that a foreign object caused the propeller blades to break.
"Freedom 90 will be moved to Woolston for repair work and will return in approximately three weeks."
Hovertravel said all passengers and crew disembarked safely after the incident and there were no reported injuries.
It apologised to customers affected by the service cancellations.
A hovercraft operating between Portsmouth and the Isle of Wight has been grounded after a propeller was broken by a "foreign object".