Broadcom (AVGO) CEO Dismisses AI Slowdown Concerns After 5% Stock Decline

Key Takeaways

• Shares of Broadcom (AVGO) declined 4.77% on Monday following remarks from Anthropic’s CEO Dario Amodei advocating for reduced velocity in AI model advancement
• Hock Tan, Broadcom’s CEO, reaffirmed the company’s AI revenue projections: $115 billion for fiscal 2027 and a doubling to $230 billion in fiscal 2028
• Tan rejected concerns about industry slowdown, characterizing AI compute requirements as “very strong and very durable”
• Anthropic is projected to surpass Google as Broadcom’s top custom chip client by 2027
• After Tan’s televised remarks, AVGO shares climbed 0.4% in extended trading; Mizuho analysts view the chip sector pullback as a purchase opportunity

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Broadcom (AVGO) ended Monday’s session at $344.72, representing a 4.77% decline, as concerns rippled through semiconductor markets following a weekend commentary from Anthropic’s CEO Dario Amodei suggesting a more measured approach to AI model evolution.

Broadcom Inc., AVGO

The commentary gained traction after receiving endorsements from both OpenAI’s Sam Altman and entrepreneur Elon Musk, intensifying pressure on chip stocks. The iShares Semiconductor ETF tumbled 5.6% during the trading day, with data center-focused companies bearing the brunt of the decline.

The spotlight fell particularly on Broadcom given Anthropic’s status as a major custom silicon client. This business relationship made AVGO shares especially vulnerable to discussions about moderating frontier AI advancement.

In response, CEO Hock Tan offered a forceful rebuttal. During his appearance on CNBC’s “Mad Money” Monday night, he delivered an unambiguous response when questioned about potential changes to the company’s outlook.

“No, not in the least,” Tan stated firmly.

He reiterated the projections he presented during Broadcom’s fiscal Q3 earnings call on September 2. These forecasts anticipate AI semiconductor revenues reaching $115 billion in fiscal 2027, before expanding to $230 billion in fiscal 2028. The 2028 projection particularly captured attention during that quarterly announcement.

Inference Computing Positioned as Sustained Growth Engine

Tan made a clear delineation between AI model training operations and inference—the continuous deployment of AI models in commercial applications and services. He characterized inference demand as a resilient growth catalyst irrespective of debates surrounding training investments.

“I don’t know about training, but when you want to productize inference, I see it continuing to be very, very strong,” Tan explained.

He also verified that Anthropic is positioned to become Broadcom’s largest custom chip client during fiscal 2027, displacing Google from this top spot—a position Google has maintained through its longstanding Tensor Processing Unit collaboration with Broadcom.

Tan acknowledged the legitimacy of AI safety considerations to some degree. While recognizing the importance of appropriate safeguards, he characterized artificial intelligence primarily as a productivity enhancement tool rather than a civilization-threatening risk. He drew parallels between AI’s transformative potential and the Industrial Revolution.

“It is still at the end of the day a tool that will make our society, humanity, reach a better level of living,” Tan remarked.

Presidential Commentary and Analyst Optimism

The AI regulation discussion extended well beyond corporate executive suites. During Monday’s All-In Summit in Los Angeles, President Trump placed a live speakerphone call to Nvidia’s Jensen Huang to counter mounting AI regulation concerns. Trump characterized warnings about AI dominance as a “hoax” and contended that excessive regulatory frameworks would primarily advantage China.

Following the event, Trump took to social media, branding himself as the AI “Hoax Buster.”

Investment firm Mizuho issued research suggesting the dramatic decline in AI-adjacent semiconductor stocks appears excessive. The firm identified Broadcom, Micron, Lam Research, and several others as fundamentally sound investments despite recent volatility, noting that proposals to decelerate frontier AI development don’t signal any genuine shift in data center capital expenditure trends.

AVGO shares gained approximately 0.4% during after-hours trading following Tan’s CNBC interview. TipRanks analysts collectively maintain a Strong Buy rating on the stock, with a consensus price target of $519.21, suggesting potential upside of approximately 51% from Monday’s closing price.

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