Broadcom

words.Broadcom’s AI chip backlog is huge, but lower margins and possible delays in OpenAI’s data‑center build‑out create downside risk, while competition with Marvell adds uncertainty; its forward P/E of ~42 leaves little margin for error, prompting a “hold” stance. Costco trades at a forward P/E of ~43, yet membership renewal rates are slipping and sales remain uneven, exposing the retailer to compression versus Walmart. Both companies face high valuations and emerging headwinds, so investors should proceed cautiously, monitoring margin stability for Broadcom and renewal trends for Costco.

words.The S&P 500 slipped after a fresh high, driven by a tech‑stock rotation while materials, financials and industrials led gains; the Dow rose 1 %. Investors await the “Santa Claus rally” starting Dec 19. Key week‑long stories: Broadcom fell 11.5% on cautious AI‑chip demand; Oracle dropped further after delaying OpenAI data‑center projects; Nvidia secured limited export licences for a throttled AI accelerator to China; GE Vernova posted strong guidance on AI‑data‑center power‑equipment. Market focus now is Fed policy, AI‑chip supply‑chain dynamics, and enterprise‑software spending.

.Broadcom’s quarterly revenue rose 28% and AI‑chip sales jumped 74%, beating forecasts, but its shares slid 11% amid a broader AI‑related market pullback that also dented the Nasdaq and S&P 500. Analysts view the dip as a buying opportunity, raising price targets to $450 and highlighting Broadcom’s $73 billion AI order backlog and its role as a key chip supplier to Google, Meta, Anthropic and eventually OpenAI. The company expects AI‑chip revenue to double to $8.2 billion this quarter, though higher component costs may pressure margins. Oracle and CoreWeave similarly suffered steep declines.

words.U.S. equity markets hit fresh highs as the S&P 500 and Dow Jones closed at record levels, while the Nasdaq lagged amid weakness in AI‑linked stocks. Oracle’s shares tumbled nearly 11% after a miss on revenue and rising AI‑related costs, pulling down Nvidia and Micron. Broadcom beat earnings but slipped 4.5% in after‑hours trading, citing concerns over Google’s in‑house production and memory‑price pressure. The Nasdaq fell 0.26%, prompting a shift toward defensive financials such as Visa and Mastercard. Meanwhile, Disney pledged $1 billion to OpenAI, Reddit challenged Australia’s teen‑social‑media ban, and former CIA chief David Petraeus warned that the U.S. national‑security strategy could unsettle Europe.

The S&P 500 and Dow hit records while the Nasdaq slipped after Oracle’s 11% fall, weighing on AI stocks; Broadcom beat forecasts and expects AI‑chip revenue to double, naming Anthropic as a $10 bn customer. Lululemon announced CEO Calvin McDonald’s exit but posted a strong earnings beat, and Costco posted record e‑commerce growth. Disney is investing $1 bn in OpenAI, granting its characters rights on the Sora platform. The U.S. seized a sanctioned oil tanker bound for Venezuela/Iran, and consumer demand for high‑fiber products is surging, prompting major brands to launch new fiber‑rich items.

Broadcom announced a $10 billion order from AI lab Anthropic for custom TPU Ironwood racks, with an additional $11 billion commitment, marking its fourth XPU customer. A fifth undisclosed client placed a $1 billion order. The deal ties into Anthropic’s multi‑year cloud partnership with Google, granting access to up to one million TPUs. Broadcom’s rack‑level AI accelerators aim to rival Nvidia’s GPUs, potentially boosting its custom‑chip revenue and expanding its foothold in the high‑performance AI market.

US equities closed at record levels Thursday, with the S&P 500 and Dow hitting fresh highs after the Fed’s quarter‑point rate cut, while the Nasdaq slipped 0.26% as AI‑linked stocks fell—Oracle down 11% on a revenue miss, dragging Nvidia and Micron, and Broadcom sliding despite earnings beat. Disney will spend $1 billion on OpenAI’s video model, and SpaceX aims for a 2026 IPO. Meanwhile, global fund managers eye India’s $3.3 trillion market, with BlackRock relaunching joint funds.

Broadcom posted a solid fiscal Q4, with revenue up 28% to $18.02 billion and adjusted EPS rising 37% to $1.95, both beating forecasts. AI‑related sales surged, highlighted by Anthropic’s $10 billion and $11 billion Ironwood XPU orders and a $1 billion deal with a new XPU client. Margins expanded, and Q1 guidance topped expectations, prompting a “Hold” rating and a price‑target lift to $425. However, investors worried about AI customers potentially developing in‑house chips, causing a 4.5% after‑hours drop despite the earnings beat.

.Broadcom beat Q4 expectations, reporting $1.95 EPS and $18.02 bn revenue, and forecast FY‑Q1 revenue of about $19.1 bn, a 28% YoY rise driven by AI demand. AI‑related chip sales doubled to $8.2 bn, boosting net income 97% to $8.51 bn. The company added a fifth custom‑AI customer, with orders totaling $11 bn and a $1 bn commitment for 2026, bringing its AI backlog to $73 bn. Broadcom’s XPU strategy aims to combine GPU throughput with ASIC efficiency, positioning it as a full‑stack AI infrastructure provider amid intense competition from Nvidia and others.

words.Broadcom’s shares hit a record as its custom‑chip portfolio gains AI traction, with Microsoft reportedly considering a shift from Marvell to Broadcom and Amazon eyeing similar moves. ASICs offer higher efficiency and lower cost than Nvidia GPUs, appealing to hyperscale operators seeking performance‑optimized, power‑light solutions. The shift signals cloud providers’ diversification of silicon sources and could cement Broadcom’s role alongside Google’s TPUs. Strong networking demand, ongoing VMware software growth, and solid fundamentals suggest Broadcom is well positioned to capture a larger share of the multi‑billion‑dollar AI accelerator market.