Nvidia next? Broadcom's value dropped by more than $440 billion as it posts disappointing forward outlook, prompting fears of AI bubble burst

Date:
Tue, 09 Jun 2026 11:05:00 +0000

Description:
Broadcom delivers stellar earnings report and in-line guidance, but investors respond by dumping shares, highlighting concerns about an AI bubble in the making.

FULL STORY ======================================================================Copy link Facebook X Whatsapp Reddit Pinterest Flipboard Threads Email Share this article 0 Join the conversation Follow us Add us as a preferred source on Google Newsletter Subscribe to our newsletter Broadcom shares plummet after
it reports earnings beat for Q2 2026 The company's market cap shrank a
mammoth 19% across two sessions after its earnings report was scrutinized by Wall Street, with its AI chip sales outlook being notably softer at $16 billion versus $17.2 billion for Q3 The behavior may indicate a frothy AI market, where investors continue to obsess over future guidance and
valuations versus current performance Broadcom's Q2 2026 earnings report, by all means, reads like that of a company that is gearing up to benefit from a splurge in AI spending across the next decade.

It posted record revenue, tripling its AI chip business year-on-year and topping its Q2 earnings-per-share (EPS) guidance. All of this, however,
failed to satisfy investors seeking details on where the company intended to continue building on its explosive growth trajectory later this year. Latest Videos From Watch full video here: A market accustomed to 'beat-and-raise' AI forecasts The fault here may not be Broadcom's but the industry's at large, with investors expecting much more than AI companies are willing to commit to in terms of future guidance.

Broadcom's market cap at the time of writing stands at $1.88 trillion, still offering an impressive YTD gain of 14.09%, though it has corrected considerably from $2.28 trillion just last week (June 2, 2026). You may like Nvidia expands AI ecosystem with $2 billion Marvell deal Nvidia CEO Jensen Huang predicts $1 trillion in sales of AI hardware China refuses to buy Nvidias AI chips after Trumps tariff plan backfires

Broadcom's somewhat aggressive collapse, which also brought Friday's AI- and chip-heavy selloff, returns focus to what is easily the biggest AI winner of them all: Nvidia . All eyes on Team Green? Nvidia, which currently sits at a considerably higher market valuation of $5.05T, also saw a significant
decline in its fortunes as Broadcom's drawdown forced the entire segment lower. Are you a pro? Subscribe to our newsletter Sign up to the TechRadar
Pro newsletter to get all the top news, opinion, features and guidance your business needs to succeed! Contact me with news and offers from other Future brands Receive email from us on behalf of our trusted partners or sponsors By submitting your information you agree to the Terms & Conditions and Privacy Policy and are aged 16 or over.

It did not see as big a decline as Broadcom but still sank nearly 6%, as investors continue to bank on sustained demand for its AI chips and a technological edge over its peers, as AI datacenter investments shift the conversation toward efficiency per token rather than raw token output per chip, and as power concerns continue to mount .

Nvidia is hardly immune to said flash crashes itself. When Chinese
researchers pushed DeepSeek, along with the narrative that distilled models could effectively cut GPU requirements to a fraction of projections, the chip designer saw its shares drop a mammoth 17-18% in a single session, erasing nearly $600 billion from its market cap.

The chip designer responded by appreciating DeekSeek's 'ingenuity' and highlighted that its chips were still just as important, if not more, going into the future, but the event underscored how quickly investors can react when any news emerges that appears to go against the grain of an everything-is-rosy narrative when it comes to AI stocks and chipmakers. What to read next Nvidia really doesn't seem to care about gaming GPUs anymore 'We have supply for very, very robust growth, but we're still supply
constrained': Jensen Huang says Nvidia has enough CPU and GPU supply to grow AI Nvidia wants to have your cake and eat it: Jensen Huang describes the AI layered stack and hints at what world's most valuable firm will do next

In a market that is now looking to usher in as many as 2 major AI IPOs in the near future - Anthropic and OpenAI at sub-trillion dollar valuations, one can understand why valuations are finicky, especially as investors are increasingly fickle about what direction to head in.

Explaining the situation or investor behavior in a market constantly chasing the next potential big winner is easier said than done. For context, the recent drop in crypto's market cap was associated with investors freeing up capital to buy into SpaceX's IPO, even as the company recently downplayed its AI ambitions

NVIDIA's next report is on August 26, 2026, where it will reveal its Q2 2027 earnings. The event is likely to be volatile as investors look for signs of either a continuation or an abatement of current demand for AI chip stocks, even as multiple investors, including Ray Dalio of Bridgewater Associates, warn of a massive bubble forming in today's stock market. Follow TechRadar on Google News and add us as a preferred source to get our expert news, reviews, and opinion in your feeds.



======================================================================
Link to news story: https://www.techradar.com/pro/nvidia-next-broadcoms-value-dropped-by-more-than -usd440-billion-as-it-posts-disappointing-forward-outlook-prompting-fears-of-a i-bubble-burst


--- Mystic BBS v1.12 A49 (Linux/64)
* Origin: tqwNet Technology News (1337:1/100)