New York, Feb 24, 2026, 10:27 EST — Regular session
- Broadcom shares fell about 3% in morning trade, extending a two-day slide.
- Traders weighed a fresh mega AI-chip supply deal involving Meta and rival AMD.
- Focus shifts to Nvidia’s earnings on Wednesday and Broadcom’s results on March 4.
Broadcom (AVGO) shares fell 2.9% to $320.70 in morning trading, after closing down 0.7% on Monday. The stock ranged from $314.67 to $324.13, with about 5.1 million shares traded. AMD climbed about 7.5% while Nvidia was little changed. (Investing)
The drop matters because Broadcom sits in the plumbing of the AI buildout: custom chips and networking gear on one side, VMware software on the other. Investors have been quick to cut exposure when the story shifts from “more demand” to “more cost.”
This week’s price action also shows how hard it is to handicap the next phase of AI spending. Big customers are signing long supply agreements, but they are also spreading orders across vendors and pushing for cheaper silicon where they can.
A new five-year supply pact between Meta Platforms and Advanced Micro Devices sharpened that debate on Tuesday. AMD said it would sell up to $60 billion of AI chips to Meta, a deal that also gives Meta a path to buy up to 10% of AMD; Nvidia shares edged lower and Broadcom fell as investors rotated around AI hardware winners and losers. “Meta is locking in supply, diversifying away from a single vendor,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown. (Reuters)
Nvidia’s quarterly results on Wednesday are the nearer test for the whole group, after a choppy month for AI-linked stocks. “This earnings in particular is important because people are so concerned about AI spending — whether we’re in a bubble,” said Ivana Delevska, chief investment officer of Spear Invest. (Reuters)
For Broadcom, the argument is less about selling the most GPUs and more about where customers land between Nvidia’s systems and a patchwork of custom silicon and Ethernet networking. Broadcom helps build those custom chips — ASICs, or processors tailored for a specific job — and sells high-end switching chips used in AI data centers.
But the stock’s upside case still runs into the same risk investors have been chewing on since December: the AI mix can pressure margins, even when revenue grows. “We expect first-quarter consolidated gross margin to be down approximately 100 basis points sequentially,” CFO Kirsten Spears said on the company’s last earnings call — 100 basis points is 1 percentage point. “The backlog is still coming from only five customers,” said Kinngai Chan, senior research analyst at Summit Insights, pointing to customer concentration, while Gil Luria at D.A. Davidson warned that “TSMC costs may squeeze the value Broadcom can realize.” (Reuters)
That leaves traders looking for something simple: proof that demand is holding up without another margin surprise, and signs Broadcom can keep converting AI orders into revenue without leaning too hard on lower-margin system shipments.
Broadcom said it will report first-quarter fiscal 2026 results on Wednesday, March 4, after the close of U.S. markets, and management will host a conference call at 5:00 p.m. ET. Investors will be watching for any update on AI chip momentum, gross margin trajectory and commentary on its software business. (Investingnews)
