The week’s headlines for Broadcom have arrived with the force of a firehose. A renewed Apple supply pact worth more than $30 billion through 2031. A rival’s expanded custom-chip deal with Google. A credit-rating downgrade. A European legal setback. And, looming over all of it, negotiations over a debt package that could reach $100 billion to fund AI chip purchases for companies like Anthropic.
Yet for all the noise, the stock’s response has been telling. Shares closed Friday at €315.45, up 1.1% on the day, but still roughly 1% below their 200-day moving average of €318.63 — and a full 27% off the 52-week high of €429.60.
A Familiar Fear, Rewritten
The sharpest single blow came midweek, when Marvell Technology disclosed an expanded custom-chip agreement with Google, including a warrant covering up to $120 billion in future purchases. Broadcom, which designs Google’s TPU chips, shed about 5% in a single session. The weekly loss now stands at 7%, with the relative strength index at 36.8 — territory that suggests nervous positioning rather than outright capitulation.
Investors who follow Broadcom’s history may recognize the pattern. In 2023, Bloomberg reported that Apple planned to replace Broadcom chips in its devices — a customer that then represented roughly 20% of revenue. The feared decline never materialized. Revenue climbed from $35.8 billion in fiscal 2023 to $63.9 billion in fiscal 2025, and the stock ran from around $58 to as high as $362. Selling on customer-loss anxiety proved costly.
Analysts have largely dismissed the Marvell-Google concerns this time as well, pointing to sustained near-term demand for Google’s TPUs, where Broadcom remains a key co-designer. But the market’s reaction underscores how thin the margin for error has become.
The Apple Anchor
Against that turbulence, the Apple extension offers something increasingly rare: predictability. The agreement, announced Friday, locks in a major smartphone chip customer through 2031, independent of the boom-and-bust cycles of AI infrastructure spending. It does not, however, appear to have moved the needle much — a sign that investors are focused elsewhere.
The numbers tell the story of a company firing on most cylinders. In the second quarter ended May 3, AI semiconductor revenue jumped 143% to $10.8 billion, total revenue rose 48% to $22.2 billion, and net income came in at $9.3 billion. Management has guided for $16 billion in AI revenue in the third quarter — a 200% increase. The top five customers accounted for roughly 40% of fiscal 2025 revenue, a concentration that cuts both ways.
Should investors sell immediately? Or is it worth buying Broadcom?
The $100 Billion Question
The most consequential development may be the one still in progress. Broadcom is reportedly in talks with private credit lenders, including Blackstone and Apollo Global Management, to secure $70 billion to $80 billion in debt financing for a chip-financing model benefiting AI firms such as Anthropic. The total arrangement could reach $100 billion.
Investors are split on the scale of the ambition. It validates demand for Broadcom’s custom silicon, but it also raises questions about balance-sheet leverage at a time when the company is already absorbing VMware integration costs. A credit-rating downgrade this week added to the unease, and a European court setback — Broadcom lost a bid to suspend an EU antitrust information request tied to the VMware acquisition — keeps regulatory uncertainty alive, even if it hasn’t affected operations.
Where the Smart Money Went
Notable moves have also occurred among prominent investors. Stanley Druckenmiller and Dan Loeb’s Third Point have fully exited their Broadcom positions, according to recent 13F filings, rotating instead into Alphabet — the very company that is both Broadcom’s largest TPU customer and now a Marvell partner. Third Point’s stake of 50,000 shares was liquidated in the second quarter of 2026.
The rotation reads less like a bet against AI infrastructure and more like a bet against single-supplier dependence. The market for custom AI chips is expanding — Marvell serves Amazon and Microsoft, while Broadcom counts Alphabet, Meta, OpenAI, and Anthropic among its clients — but the allocation of that growth is shifting in real time.
Valuation and the Road Ahead
On valuation, Broadcom remains the cheaper of the two custom-chip players. Its forward price-to-earnings ratio sits at roughly half of Marvell’s, and analysts project 64% revenue growth for Broadcom in fiscal 2027 versus 45% for Marvell. The trailing P/E of around 60, however, suggests the market is already pricing in substantial growth — and punishing any hint of disappointment.
Wall Street’s sell-side remains largely constructive. Mizuho’s Vijay Rakesh reiterated an “Outperform” rating with a $530 price target, citing Broadcom’s leadership in custom ASICs, SerDes technology, and advanced packaging for Google’s TPU deployments. BMO Capital Markets initiated coverage with “Outperform” and a $455 target, highlighting Broadcom’s position as the leading US player in AI computing and networking.
The next test arrives September 2, when Broadcom reports third-quarter fiscal 2026 results. Management has guided for revenue of roughly $29.4 billion, an 84% year-over-year increase. With annualized volatility at 43%, the stock’s sensitivity to headlines shows no sign of abating — but the 2023 playbook suggests that customer-concentration fears, however loud, have not historically marked the end of Broadcom’s growth story.
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