Nvidia and Broadcom's AI Chips Face Off: A Comparison.
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy AVGO?
Source: Barron's
Nvidia and Broadcom Competition: Nvidia and Broadcom are entering direct competition as AI companies seek cost-effective solutions for training and running AI models.
Growing Demand for Broadcom: Analysts at UBS report a rapid increase in demand for Broadcom's processors as a viable alternative to Nvidia's offerings.
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Analyst Views on AVGO
Wall Street analysts forecast AVGO stock price to rise
28 Analyst Rating
27 Buy
1 Hold
0 Sell
Strong Buy
Current: 331.170
Low
390.00
Averages
462.58
High
525.00
Current: 331.170
Low
390.00
Averages
462.58
High
525.00
About AVGO
Broadcom Inc. is a global technology firm that designs, develops, and supplies a range of semiconductors, enterprise software and security solutions. The Company operates through two segments: semiconductor solutions and infrastructure software. Its semiconductor solutions segment includes all of its product lines and intellectual property (IP) licensing. It provides a variety of radio frequency semiconductor devices, wireless connectivity solutions, custom touch controllers, and inductive charging solutions for mobile applications. Its infrastructure software segment includes its private and hybrid cloud, application development and delivery, software-defined edge, application networking and security, mainframe, distributed and cybersecurity solutions, and its FC SAN business. It provides a portfolio of software solutions that enable customers to plan, develop, automate, manage and secure applications across mainframe, distributed, mobile and cloud platforms.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Broadcom Stock Surges Over 600% in Five Years
- Outstanding Stock Performance: Broadcom's stock has surged over 600% in the past five years, reflecting strong performance in the tech sector and increased investor confidence, further solidifying its market position.
- Stable Cash Flow: The company currently boasts a free cash flow of $7.4 billion, enabling it to consistently pay a quarterly dividend of $0.65 per share while continuing to invest in growth, indicating its financial health.
- Robust Revenue Growth: In its fourth-quarter 2025 report, Broadcom's revenues grew by 28% year-over-year, with free cash flow up 36%, and even if growth slows slightly in the coming quarters, its strong balance sheet provides a true economic moat.
- Massive Backlog: Broadcom's backlog stands at an impressive $162 billion, ensuring growth potential for the next decade while showcasing its competitive advantage and execution capabilities in the market.
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- TSMC's Market Share Growth: Taiwan Semiconductor Manufacturing increased its market share from 66% to 72% in Q3, with Q4 revenue reaching $33.73 billion, a 25.5% year-over-year increase, and guidance for even better revenue in Q1, showcasing its leadership and robust growth prospects in the semiconductor industry.
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- Performance Improvement: In Q4, AMD's data center segment saw a 39% year-over-year revenue increase, which, while falling short of the 60% target, marks a significant improvement from the 22% growth in the third quarter, suggesting progress towards its goals.
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- Leading Technological Innovation: Astera's Scorpio smart fabric switches are the first PCIe 6 fabric switches designed specifically for scaling AI data centers, offering software-defined flexibility that efficiently connects various GPUs and other data center components, thereby enhancing overall performance and interconnectivity.
- Software System Optimization: The COSMOS system management and optimization software provided by Astera enables real-time monitoring of performance between hardware links and predicts hardware failures, ensuring efficient and reliable data flow, which will further enhance operational efficiency for clients.
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- Market Response: Despite the stock market crash, Broadcom (AVGO) is viewed as an attractive buy during downturns, particularly due to its strong performance in the AI chip sector, which is expected to continue driving company growth.
- Revenue Expectations: CEO Tan Hock indicated that AI semiconductor revenue is projected to double year-over-year to $8.2 billion in Q1, representing over 40% of the company's projected revenue for Q1 2026, highlighting robust market demand.
- Investment Trends: Tech giants have committed approximately $650 billion towards AI investments by 2026, indicating a growing emphasis on AI technology, from which Broadcom, as a key supplier of customized chips, stands to benefit significantly.
- Competitive Advantage: Broadcom's focus on the customization of ASIC chips provides it with a unique position in competition with rivals like Nvidia, which is expected to further solidify its market leadership and drive future performance growth.
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AI Impact on Jobs: Concerns are growing about the impact of AI on the job market, leading to a circular debate among investors regarding future interest rate cuts and stock valuations.
Earnings Season Insights: Major companies in the AI trade are posting strong earnings, which may influence stock prices positively, while the overall outlook for stocks remains bullish.
Investment Opportunities: Analysts highlight specific stocks, including those in the insurance and energy sectors, as potential buys, while cautioning investors about the risks associated with tech stocks and the broader market's direction.
See More
Broadcom Stock Surges Over 600% in Five Years
- Outstanding Stock Performance: Broadcom's stock has surged over 600% in the past five years, reflecting strong performance in the tech sector and increased investor confidence, further solidifying its market position.
- Stable Cash Flow: The company currently boasts a free cash flow of $7.4 billion, enabling it to consistently pay a quarterly dividend of $0.65 per share while continuing to invest in growth, indicating its financial health.
- Robust Revenue Growth: In its fourth-quarter 2025 report, Broadcom's revenues grew by 28% year-over-year, with free cash flow up 36%, and even if growth slows slightly in the coming quarters, its strong balance sheet provides a true economic moat.
- Massive Backlog: Broadcom's backlog stands at an impressive $162 billion, ensuring growth potential for the next decade while showcasing its competitive advantage and execution capabilities in the market.
See More
Cryptocurrency Market Slump and Tech Stock Opportunities
- Cryptocurrency Market Decline: The overall cryptocurrency market has fallen over 45% since reaching a high of $4.28 trillion on October 6, 2025, primarily driven by Bitcoin's price drop and institutional ETF withdrawals, highlighting the market's heavy reliance on sentiment and liquidity.
- Alphabet's Strong Earnings: Alphabet reported $113.8 billion in revenue for Q4, an 18% year-over-year increase, with net income of $34.45 billion, up nearly 30%, although the market reacted cautiously to its $185 billion AI infrastructure spending, the rapid growth of its cloud computing division indicates strong business potential.
- TSMC's Market Share Growth: Taiwan Semiconductor Manufacturing increased its market share from 66% to 72% in Q3, with Q4 revenue reaching $33.73 billion, a 25.5% year-over-year increase, and guidance for even better revenue in Q1, showcasing its leadership and robust growth prospects in the semiconductor industry.
- Oracle's Cloud Computing Growth: Oracle generated $7.97 billion in revenue in Q2 of fiscal 2026, a 34% increase year-over-year, with cloud computing becoming its largest revenue driver; despite over $100 billion in debt, its growth potential remains significant compared to the risks associated with cryptocurrencies.
See More
AMD Stock Volatility Amid AI Prospects
- Stock Volatility: Since the beginning of 2025, AMD's stock has risen approximately 71%, yet it is currently down about 22% from its all-time high set in October 2025, indicating market uncertainty regarding its future performance.
- AI Market Potential: AMD's management remains optimistic about its five-year outlook, projecting a 60% compounded annual growth rate (CAGR) in its data center division, which stands to benefit from over $500 billion in capital expenditures committed by companies like Amazon, Meta, and Alphabet in 2026.
- Performance Improvement: In Q4, AMD's data center segment saw a 39% year-over-year revenue increase, which, while falling short of the 60% target, marks a significant improvement from the 22% growth in the third quarter, suggesting progress towards its goals.
- Investor Confidence: Despite AMD's potential for a turnaround, it still lags behind Nvidia, which is growing its AI business at a faster pace and trades at a more attractive valuation, prompting investors to carefully consider their holding strategies.
See More
Astera Labs: The Future of AI Data Center Interconnectivity
- Significant Market Potential: Astera Labs anticipates full-year revenue of $852.5 million for 2025, reflecting a 115% year-over-year growth, which underscores its strong growth potential in AI data center interconnectivity solutions amid rising demand for high-performance switching solutions.
- Leading Technological Innovation: Astera's Scorpio smart fabric switches are the first PCIe 6 fabric switches designed specifically for scaling AI data centers, offering software-defined flexibility that efficiently connects various GPUs and other data center components, thereby enhancing overall performance and interconnectivity.
- Software System Optimization: The COSMOS system management and optimization software provided by Astera enables real-time monitoring of performance between hardware links and predicts hardware failures, ensuring efficient and reliable data flow, which will further enhance operational efficiency for clients.
- Industry Growth Outlook: According to Mordor Intelligence, the market for AI data center interconnectivity solutions is expected to grow nearly 15% annually, reaching over $40 billion by 2032, positioning Astera Labs prominently in this rapidly expanding market.
See More
Broadcom's Competitive Edge in AI Chips
- Market Response: Despite the stock market crash, Broadcom (AVGO) is viewed as an attractive buy during downturns, particularly due to its strong performance in the AI chip sector, which is expected to continue driving company growth.
- Revenue Expectations: CEO Tan Hock indicated that AI semiconductor revenue is projected to double year-over-year to $8.2 billion in Q1, representing over 40% of the company's projected revenue for Q1 2026, highlighting robust market demand.
- Investment Trends: Tech giants have committed approximately $650 billion towards AI investments by 2026, indicating a growing emphasis on AI technology, from which Broadcom, as a key supplier of customized chips, stands to benefit significantly.
- Competitive Advantage: Broadcom's focus on the customization of ASIC chips provides it with a unique position in competition with rivals like Nvidia, which is expected to further solidify its market leadership and drive future performance growth.
See More
MarketBeat Weekly Recap – February 9 to February 13
Market Overview: Stocks are under pressure despite cooler-than-expected inflation readings, with investors focusing on valuations, particularly in the artificial intelligence sector, as earnings season reveals strong numbers from major players.
AI Impact on Jobs: Concerns are growing about the impact of AI on the job market, leading to a circular debate among investors regarding future interest rate cuts and stock valuations.
Earnings Season Insights: Major companies in the AI trade are posting strong earnings, which may influence stock prices positively, while the overall outlook for stocks remains bullish.
Investment Opportunities: Analysts highlight specific stocks, including those in the insurance and energy sectors, as potential buys, while cautioning investors about the risks associated with tech stocks and the broader market's direction.
See More
