NVIDIA's blue-chip stock afterglow! Broadcom soars: the unstoppable force behind it, the tough guy Chen Fuyang

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The sectors related to artificial intelligence and semiconductors continue to be hot. In the past few days, the global IC design giant Broadcom Corporation, listed on NASDAQ as AVGO, surged by 15% at the opening last Thursday, reaching a historic high for the company.

Experts agree that the simultaneous global optimism towards the artificial intelligence market is propelling this long-standing semiconductor company (established in 1961) to new heights. Broadcom's current CEO, Hock E. Tan, a Malaysian Chinese, has a brilliant track record and has been aggressive in acquiring several semiconductor companies through bold mergers and acquisitions.

Starting in 2013, under Hock E. Tan's leadership, Avago, now known as Broadcom, began acquiring chip companies with a larger market value than their own. Avago financed a $6.6 billion acquisition of LSI, a storage chip factory in San Jose, Silicon Valley.

In 2015, under Tan's direction, Avago made another significant move by acquiring California-based semiconductor company Broadcom for $37 billion, making it the largest acquisition in the semiconductor industry at that time. Avago financed this deal with $9 billion.

Hock E. Tan responded to Trump's "Make America Great Again" slogan by relocating Broadcom from Singapore to Silicon Valley, California. In 2017, Broadcom was preparing to acquire the world's largest mobile chip manufacturer Qualcomm at a price of $70 per share. On March 12, 2018, then U.S. President Trump blocked the acquisition on national security grounds. Trump stated, "Reliable sources confirm that Broadcom's acquisition of Qualcomm may jeopardize national security."

According to Robinhood's 24-hour real-time information, during the historic high last Thursday, 84% of retail investors bought, 16% held, and 0% sold.

Broadcom's Q2 revenue was $12.48 billion, a 43% increase from the same period last year, surpassing the estimated $12.04 billion by 4%. Wall Street analysts attribute the revenue growth to $310 million in revenue from AI chips, a 280% increase from the same period last year.

Broadcom's AI chip capabilities are used to process big data for the artificial intelligence application OpenAI ChatGPT. Broadcom attributes the stock's surge to strong market demand for AI chips and the effect of Broadcom's acquisition of VMware by the end of 2023. VMware is virtualization software that runs on physical computers and cloud data centers.

On the other hand, Nvidia's core products are computer graphics processors, chips, and multimedia software design, which are used for GPU graphics processing, network operations, and the metaverse and gaming chips Graphic Cards by GeForce. Nvidia's cloud acceleration platform, The NVIDIA Unified Platform, integrates GPU, DPU, and CPU architectures to enhance data computing performance and security. According to Nvidia's website, accelerated systems are the next stage of computer development. Just as all smartphones today are equipped with graphics and artificial intelligence processors, each server and workstation will also be equipped with computing accelerators for modern applications.

Broadcom's financial results for the second quarter of this year, announced on June 13, far exceeded market expectations. Broadcom announced a 1-for-10 stock split on July 15. According to Bank of America's prediction, Broadcom is likely to be the next stock to reach a trillion-dollar market value. As of today, Broadcom closed at $1,735 USD, with a current market value of $804 billion.

According to Investopedia's report, in February of this year, Broadcom's market value was $58.48 billion, making it the fifth-largest semiconductor company globally, with the top four being Samsung, TSMC, Nvidia, and Intel. The bullish predictions for Broadcom are likely to propel its market value to surpass the top three semiconductor companies.