Broadcom ( (AVGO) ) has fallen by -12.63%. Read on to learn why.
Broadcom has experienced a significant stock price decline of 12.63% over the past week, a reflection of broader challenges in the tech sector. The downturn is attributed to ongoing tariff wars, chip export restrictions, and rising competition within the semiconductor industry. Despite these setbacks, Wall Street analysts remain optimistic about Broadcom’s long-term prospects, particularly due to the strong demand for its custom AI chips, which are crucial for training and deploying AI models.
The company’s AI revenue has seen a substantial increase, jumping 77% year-over-year in the first quarter of fiscal year 2025, reaching $4.1 billion. Broadcom anticipates further growth in AI revenue, projecting it to rise to $4.4 billion in the upcoming quarter. The company is also expanding its customer base, working with new clients to develop custom AI chips, which is expected to bolster its market position and revenue streams in the coming years.
Analysts have a positive outlook on Broadcom, with a Strong Buy consensus rating. The stock’s recent pullback is seen as a potential buying opportunity, with an average price target suggesting a significant upside potential. Broadcom’s strategic positioning in the AI sector, combined with its robust financial performance, suggests that the current stock price dip may be temporary, offering an attractive entry point for investors looking to capitalize on the company’s growth trajectory.