AVGO -4.35% NVDA -2.94% OPAI.PVT Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Shares of Broadcom (NASDAQ:AVGO) turned lower on Thursday, falling as much as 5.1%. The stock was still down 4.4% by the time the market closed.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
The catalyst that sent the semiconductor and networking specialist lower was news that OpenAI's revenue was substantially lower than had been previously reported.
Artificial intelligence (AI) start-up OpenAI revealed that its annualized revenue was roughly $50 billion as of the end of September, significantly lower than the $68 billion that had been widely reported by the financial media late last month.
In an updated presentation shown to potential investors, OpenAI clarified the figure, noting that the $68 billion included gross revenue from the company's partners and was meant to provide an apples-to-apples comparison to its most direct competitor, start-up Anthropic.
Many AI stocks tend to move together, so the news alone may have been enough to send Broadcom lower. However, the company has a more direct connection to OpenAI. Reports emerged yesterday that Broadcom was working to line up roughly $50 billion in financing for OpenAI to fund the purchase of AI-centric chips.
Broadcom and OpenAI have been collaborating on a custom AI processor, dubbed "Jalapeno," which is expected to be deployed later this year. Given the close ties between the two, it makes sense that the company would help OpenAI arrange financing to buy Broadcom's custom chips.
Taking a step back, if OpenAI's revenue isn't all it was cracked up to be, it may have fewer resources and less need for Broadcom's chips. Add in fears about circular financing deals in the space, and it's easy to see why investors might be nervous, though this appears to be nothing more than an accounting disclosure.
At 31 times forward earnings and 18 times next year's expected earnings, Broadcom is attractively priced relative to the size of the opportunity. Moves like this provide astute investors with the opportunity to pick up shares at a discount.
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Broadcom wasn't one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $375,887!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,459,146!*
That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul.
*Stock Advisor returns as of October 8, 2026.
Danny Vena, CPA has positions in Broadcom. The Motley Fool has positions in and recommends Broadcom. The Motley Fool has a disclosure policy.
Why Broadcom Stock Took a Dive Today was originally published by The Motley Fool
