Nvidia Shares Fall More Than 2% Amid Divergence from Broadcom
Nvidia shares declined more than 2% on Tuesday morning, bringing the company’s stock value below its correction territory benchmark. The company’s share price had fallen 5% over the past five days, whereas Broadcom’s shares had surged 40% during the same period. Broadcom’s stock rise was fueled by the company’s release of fiscal fourth-quarter earnings that exceeded expectations and a revenue outlook that beat forecasts. Several Wall Street brokers, including Goldman Sachs, have raised their price targets on Broadcom’s stock.
Despite Nvidia’s decline, the company has still seen significant growth in its graphics processing units, which are widely used in artificial intelligence model training. Broadcom, on the other hand, is developing custom AI chips for hyperscalers, large cloud computing companies. The company’s CEO, Hock Tan, believes there is a significant opportunity in AI development over the next three years, with hyperscalers beginning to develop their own custom AI accelerators.
Broadcom’s shares have risen more than 120% this year, outpacing Nvidia’s gains of over 160%. Nvidia’s stock price had fallen to $141.56 on Tuesday, down from its all-time high closing price of $148.88 last month. The company’s recent decline from its peak may be due to the diverging trends between Nvidia and Broadcom shares.