AVGO falls sharply after earnings disappointment but retains growth in custom AI chip business, analysts suggest buying opportunity.
Broadcom (NASDAQ: AVGO) shares have declined 31% from their 2024 peak, now up just 9% year-to-date, following a poorly received earnings report and broader AI sector pullback. The stock had surged 40% earlier in the year before sentiment shifted amid market volatility.
The company’s custom AI chip business remains a key growth driver, with demand rising as firms seek cost-effective alternatives to GPUs. Broadcom’s tailored chips often outperform traditional GPUs in specific workloads while reducing expenses, positioning it competitively in the AI hardware market.
Despite the recent selloff, some analysts view the dip as a buying opportunity, citing long-term potential in AI infrastructure demand.