By Khac Phu Nguyen
Publication Date: 2026-10-08 20:46:00
This article first appeared on GuruFocus.
Broadcom (NASDAQ:AVGO), the custom AI accelerator and networking-chip supplier, fell about 2.1% to $368.38 at approximately 10:33 a.m. ET on Thursday. Strong foundry sales offered little protection from selling across the AI-chip trade. According to Barron’s, TSMC’s record sales failed to give the sector a broad lift. Investors want more than another sign that AI demand remains hot.
Broadcom’s own hurdle is steep. Management projected $21.7 billion in fourth-quarter AI semiconductor revenue after delivering $16.7 billion in the third quarter, up 221% from a year earlier. That forecast requires roughly 30% sequential growth. It also puts AI chips at more than 62% of the company’s projected $34.8 billion quarterly revenue. AI increasingly sets the pace for the whole business.
The valuation…
