New York, Jan 5, 2026, 10:24 (EST) — Regular session
- Broadcom shares fell about 2% in morning trade, underperforming semiconductor ETFs that rose nearly 2%.
- Investors stayed focused on AI buildout costs and their impact on inflation and chipmaker margins.
- Next on the calendar: ISM services data on Jan. 7, U.S. CPI on Jan. 13, and Broadcom’s next results expected in early March.
Broadcom Inc shares slid on Monday, bucking a broader lift in chip stocks as investors kept a tight focus on the cost of the AI buildout and what it means for margins across the sector.
The move matters because Broadcom sits at the center of the AI infrastructure trade, selling networking silicon and custom chips into hyperscale data centers — large cloud operators that spend heavily on computing capacity. Traders have treated the stock as a proxy for whether AI growth can stay fast without eroding profitability.
It also lands as markets debate whether the data-center spending wave will rekindle inflation and keep interest rates restrictive, a combination that tends to punish high-valuation technology names. Reuters
By mid-morning, Broadcom was down 1.9% at $341.13, after swinging between $336.78 and $355.07 earlier in the session. The stock is about 18% below its 52-week high of $414.61. Nasdaq
The broader tape was firmer after Wall Street opened higher, with technology shares rebounding and energy stocks jumping after the U.S. capture of Venezuelan President Nicolas Maduro, Reuters reported. Investing
Chipmakers as a group outperformed. The iShares Semiconductor ETF and VanEck Semiconductor ETF were up about 1.9% each, while Nvidia and AMD edged higher, leaving Broadcom among the notable laggards in the AI-linked group.
Morgan Stanley strategist Andrew Sheets flagged the same pressure point that has dogged AI hardware winners for months: “The costs are going up not down in our forecast, because there’s inflation in chip costs and inflation in power costs.” Reuters
U.S. data underscored the inflation-and-rates crosscurrents. The Institute for Supply Management said its manufacturing PMI fell to 47.9 in December; a reading below 50 signals contraction, and the report’s prices-paid gauge held at 58.5, pointing to elevated input costs.
Broadcom’s own margin narrative remains the overhang. In December, CFO Kirsten Spears said the company expected first-quarter gross margin to fall about 100 basis points — one percentage point — as AI revenue becomes a larger mix, even as CEO Hock Tan cited a $73 billion AI order backlog and forecast AI semiconductor revenue would double to $8.2 billion in the quarter.
But the path is narrow: if system-level AI sales and custom processors expand faster than higher-margin products, profitability could disappoint again, and any inflation flare-up that forces tighter policy could compress multiples across the AI complex. Investors will watch ISM services data on Jan. 7 and the U.S. CPI release on Jan. 13, ahead of Broadcom’s next earnings update, which Zacks’ calendar lists for March 5. Zacks
