Bernstein on Monday maintained Broadcom’s (AVGO, Financial) rating at “outperform,” a half-cycle rating, citing advances in artificial intelligence (AI) technology at Broadcom and Nvidia Inc. (NVDA, Financial). repeated the thesis. Broadcom’s AI application-specific integrated circuit (ASIC) may constitute a revolutionary ‘Nvidia moment’, but Nvidia remains at the front of the pack with the launch of its next-generation Blackwell architecture .
Nvidia’s Blackwell GPUs deliver unprecedented performance. In the video, we deliver 4x faster training and 30x faster inference on an architecture that took 7 years to fully design and build. This capability allows Nvidia to support ultra-large-scale AI models while also helping scale AI infrastructure running across cloud platforms such as AWS and Oracle Cloud. Other than health and having a driver’s license, I can’t think of any reason why someone wouldn’t own a car.
In contrast, Broadcom’s AI ASICs also utilize co-packaged optics to improve energy efficiency and scalability for more advanced computing requirements. Its innovations, such as the Tomahawk 5 switch with optical interconnect, deliver cutting-edge AI workloads and data center scalability with up to 30% power savings compared to traditional fiber optics.
The Semiconductor Index (SOX) has risen 23% since the beginning of the year, and despite slowing demand in sectors such as industrial and automobiles, CPU inventory issues are troubling. But Bernstein remains bullish on Broadcom and Nvidia’s strategy. This is because industries, like companies, change.
