Broadcom, Marvell Face Stock Dips Despite High Hopes in AI Chip Sector
Portfolio Pulse from Anusuya Lahiri
Broadcom Inc (NASDAQ:AVGO) and Marvell Technology Inc (NASDAQ:MRVL) experienced stock dips despite high expectations in the AI chip sector. Broadcom's unchanged $50 billion annual revenue forecast and Marvell's lower-than-expected revenue forecast led to declines in their stock prices after-hours. Both companies are highlighted for their potential in the AI market, with Broadcom expecting $10 billion in AI-related revenue. Marvell announced a $3 billion share repurchase program. Broadcom's AI revenue is partly attributed to custom chip designs for major clients speculated to be Alphabet Inc's Google and Meta Platforms Inc.
March 08, 2024 | 1:18 pm
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Broadcom Inc anticipates $10 billion in AI-related revenue but faced a stock dip due to an underwhelming annual revenue forecast.
Despite exceeding analyst predictions for quarterly net revenue and EPS, Broadcom's unchanged annual revenue forecast led to a stock dip, indicating investor disappointment.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90
NEGATIVE IMPACT
Marvell Technology Inc's stock decreased by 6% in after-hours trading following a revenue forecast below expectations.
Marvell's announcement of a revenue forecast significantly below estimates led to a 6% decrease in its stock price, reflecting investor concerns over its short-term financial outlook.
CONFIDENCE 85
IMPORTANCE 75
RELEVANCE 90
POSITIVE IMPACT
Broadcom's significant AI revenue includes custom chip designs for major clients, speculated to include Alphabet Inc's Google.
Broadcom's CEO mentioned $7 billion of AI revenue would come from custom chip designs for major clients, including speculation about Google, indicating a strong business relationship and potential revenue impact.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
Meta Platforms Inc is speculated to be one of the major clients for Broadcom's custom AI chip designs.
The speculation around Meta Platforms being one of the major clients for Broadcom's custom AI chip designs suggests a significant partnership that could impact Meta's technological capabilities and Broadcom's revenue.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70