Broadcom Surges Past Nvidia as Custom AI Chips Reshape Semiconductor Landscape

Broadcom's stock has surged 40% over the past year, eclipsing Nvidia's 22% gain and making it the hotter semiconductor trade. This divergence marks a pivotal moment in the AI chip wars, as Broadcom designs custom application-specific integrated circuits (ASICs) for hyperscalers' critical workloads.

Nvidia's graphics processing units are still the go-to choice for general-purpose AI accelerators, but Broadcom is gaining ground with its ASICs. In its fiscal 2026 second quarter, Broadcom reported total revenue of $22.19 billion, up 48% from a year earlier, while net income nearly doubled.

Broadcom's AI semiconductor revenue jumped 143% year over year to $10.80 billion and now accounts for almost half of total sales. CEO Hock Tan expects this segment to grow more than 200% in the fiscal third quarter, reaching $16 billion, which would represent the majority of the company's projected $29 billion in quarterly revenue.