Shares in semiconductors and chips, including Nvidia Corp (NASDAQ: NVDA), Taiwan Semiconductor Manufacturing Co (NYSE:TSM), Broadcom Inc (NASDAQ:AVGO), Marvell Technology Inc (NASDAQ:MRVL), Lamb Research Corp (NASDAQ:LRCX) shares are trading lower on Wednesday ahead of Nvidia’s fiscal second-quarter earnings report, reflecting the interconnected semiconductor ecosystem.
The sale also follows the important Nvidia partner Super Micro Computer, Inc (NASDAQ:SMCI) is controlled by Hindenburg for accounting malpractice, related party transactions and more, leading to a delayed filing of its annual report. Shares of Super Micro have fallen nearly 27%.
Nvidia’s revenue guidance of $27.44 billion-$28.56 billion for the second quarter of fiscal 2025 is a big jump from its $13.51 billion in revenue for the second quarter of fiscal 2024, and is a testament to the stock’s continued AI tailwinds. The stock is up more than 172% over the past 12 months.
JPMorgan’s Harlan Sur expects Broadcom to be worth more than $150 billion in AI semiconductor opportunities over the next five years after it secured ChatGPT parent OpenAI and a major AI ASIC customer.
The analyst backed his forecasts with Broadcom’s plans to ramp up growth Alphabet Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) Google’s next-generation 3nm TPU AI processor and Meta Platforms Inc (NASDAQ:META) a key partner of Broadcom. Broadcom shares are up 87% in the past 12 months.
Sur previously mentioned that Broadcom has an 80% market share in the $5-7 billion data center/AI Ethernet switching and routing chipset market, putting it ahead of Nvidia and Marvell Technology.
Taiwan Semiconductor is a major supplier to Nvidia and also leads the global foundry market with a 62% share in the second quarter of 2024. It posted third-quarter revenue of $22.4 billion-$23.3 billion, up from the $17.3 billion reported a year ago, supported by robust demand for AI in hyper-performance computing and smartphones.
The contract chipmaker is looking to raise prices for its 3-nanometer and 5-nanometer process products to maintain its margin targets. Taiwan Semiconductor shares have risen more than 80% in the past 12 months.
AI server company Super Micro is another beneficiary of the AI wave. It expects first-quarter revenue of $6 billion, up from $7 billion from the $2.12 billion it reported a year ago. The stock has surged more than 61% in the past 12 months, buoyed by demand for AI servers from Big Tech giants.
Marvell Technology expects second-quarter revenue of $1.19 billion, up from $1.31 billion from the $1.34 billion it reported a year ago, driven by a ramp-up of custom AI silicon for data centers, enterprise networks and carrier infrastructure. Shares have risen more than 24% in the past 12 months.
Lam Research expects first-quarter revenue of $3.75 billion to $4.35 billion, up from the $3.48 billion it reported a year ago. The company is looking to tap into spending on wafer fab equipment, driven by demand for AI-powered chips. Shares have risen more than 20% in the past 12 months.
Price promotions: TSM shares were down 2.07% to $167.01 at last check on Wednesday. AVGO was down 2.66% to $157.06, MRVL was down 2.55% to $67.94 and LRCX was down 2.49% to $801.29.
Image via Nvidia Blog
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This article AI Chip Stocks Rally Faces New Counterwinds – Why Are Nvidia, Taiwan Semiconductor, Broadcom, Marvell Tech Stocks Falling? originally appeared on Benzinga.com
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