Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTAnthony Di Pizio, The Motley FoolSun, June 7, 2026 at 11:59 AM GMT+2 6 min readThe semiconductor sector suffered a brutal sell-off last week, and it started with Broadcom's (NASDAQ: AVGO) latest quarterly earnings report on Wednesday evening. Despite posting a strong result, the company's forward guidance fell short of Wall Street's expectations, which triggered a 20% decline in its stock.Broadcom remains a high-quality business with a strong demand pipeline for its artificial intelligence (AI) accelerators, which are customizable data center chips that have become a popular alternative to the traditional graphics processing units (GPUs) supplied by competitors like Nvidia. Therefore, could the recent dip be a buying opportunity for investors? The answer might surprise you.Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »Image source: Getty Images.An impressive list of AI customersNvidia's GPUs are the best out-of-the-box data center chips for AI workloads, but hyperscalers like Alphabet and Meta Platforms are increasingly chasing more specialized solutions to fulfill their specific needs, so Broadcom is helping them design and fabricate custom AI accelerators.Alphabet has a long-term partnership with Broadcom covering several generations of its AI data center chips, which it calls Tensor Processing Units (TPUs). Alphabet recently unveiled the TPU 8t for AI training, which offers 3 times the processing power of its previous generation (called Ironwood), and the 8i for AI inference, which delivers an 80% improvement in performance-per-dollar. Without Broadcom, companies like Alphabet would be trapped inside closed ecosystems with suppliers like Nvidia, with limited control over pricing and innovation.Broadcom also supplies accelerators to leading AI start-ups Anthropic and OpenAI, which continue to diversify their hardware stacks to unlock as much computing capacity as possible. Anthropic is buying at least $21 billion worth of Alphabet's TPUs through Broadcom, which will be deployed gradually throughout 2026 and 2027.But Broadcom is also one of the world's top suppliers of data center networking equipment. Its Tomahawk 6 Ethernet switch, which regulates how fast data travels between chips and devices, is the industry's only 100-terabit solution. However, the company is now launching a new version with double the capacity.Broadcom's Q2 revenue growth accelerated, but guidance fell shortBroadcom generated $22.2 billion in total revenue during its fiscal 2026 second quarter (ended May 3), which was a 48% increase from the year-ago period. That growth rate marked a significant acceleration from the first-quarter result of 29% just three months earlier, and the momentum was mostly driven by AI-related sales.Terms and Privacy PolicyPrivacy & Cookie SettingsMore Info