Broadcom shares fell 1.7% on April 20 after a report said Alphabet’s Google was talking with Marvell about making new AI chips for Google. The move put a fresh spotlight on avgo, a stock that has been one of the market’s hottest large-cap names even with the pullback.
Broadcom still designs AI chips for Google, and Google is one of several major customers leaning on the company’s AI server compute ASICs. Microsoft, Amazon and Meta are also among the biggest buyers, and Broadcom recently announced a multi-gigawatt rollout of AI chips under a long-term partnership with Meta. The company said those semiconductors would help Meta bring real-time generative AI features and “personal superintelligence” to its customers.
The market has already rewarded that business. Broadcom’s shares rose 29.5% in the month ended April 20 and were up 142% over the previous year, lifting its market value to $1.89 trillion. Even after that run, the stock traded at 40.85 times forward earnings, a level that makes it look expensive on traditional valuation screens but still tied to a company growing into one of the biggest AI infrastructure suppliers in the market.
That growth story is not built on one customer. Counterpoint Research said in January that Broadcom was expected to control 60% of the AI server compute ASIC design market by 2027, and it said shipments for the top 10 players were set to triple between 2024 and 2027. Analysts on average expect Broadcom’s earnings per share to surge 76.7% in the current fiscal year, a forecast that helps explain why investors have kept paying up even when headlines around customer deals turn choppy.
The tension for shareholders is that Broadcom’s biggest AI relationships are lucrative but not locked in stone. The company and Meta did not disclose how much revenue the partnership will generate, though Broadcom said it had already taken in $2.3 billion from Meta in 2025 alone. At the same time, a benchmark analyst kept a $485 price target and Buy rating on AVGO, suggesting the latest drop has not changed the broader bullish view.
Broadcom’s ability to keep winning large AI contracts will matter more than a one-day slide. Google’s talks with Marvell show that even the strongest customer ties can face pressure, but the scale of the AI-chip market expected in the coming quarters means the larger fight is still over how much of that growth Broadcom can hold on to.
