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Broadcom’s AI Surge Faces Valuation Test After Record Quarter

Shares hover near $1.7 trillion, with investors focused on execution risk for massive custom‑chip ramps.

Overview

  • Broadcom reported record fiscal third‑quarter revenue of about $15.9 billion, with AI semiconductor sales up 63% to $5.2 billion and guidance for AI revenue growth above 60% into 2026.
  • The company disclosed $10 billion in custom AI‑chip orders and later announced an OpenAI deal to deploy roughly 10 gigawatts of accelerators.
  • The stock has jumped since 2023 but is up about 48% year to date after a recent pullback, putting its market capitalization near $1.7 trillion.
  • Shares trade at more than 90 times trailing earnings, increasing downside risk if growth or ramp timelines fall short.
  • Recent disclosures show purchases by Reps. Cleo Fields, Ro Khanna and Michael McCaul, and institutions such as Polen initiated positions as commentary flags both AI tailwinds and bubble concerns.