Broadcom's 25% Pullback Exposes a Widening AI Valuation Gap With AMD

Broadcom shares sit about 25% off their peak heading into the company's next earnings report, even though CEO Hock Tan has repeated his forecast of more than $100 billion in AI-related revenue by 2027 without changing the number since June. That gap between a steady guidance figure and a falling stock price says the market has grown more skeptical of the multiple it should pay for AI infrastructure spending, not of Broadcom's actual sales trajectory. The divergence looks sharper next to AMD. Commentary circulating this week frames Broadcom as the steadier, more established AI infrastructure supplier, while AMD is priced as the higher-risk, higher-reward challenger trying to take share from Nvidia in AI chips. Investors are effectively demanding a bigger discount for Broadcom's certainty and a bigger premium for AMD's upside bet, even though both companies sell into the same AI buildout. Broadcom's upcoming results, alongside the next jobs report, are being flagged as the two events most likely to test whether the broader stock rally holds together. If Broadcom's numbers confirm the $100 billion 2027 path, the current discount may prove to be a market overreaction rather than a genuine reassessment of AI chip demand.