Broadcom (AVGO) shares remained under pressure on October 13 after closing Monday at $354.73, down 1.88%. The stock has now fallen roughly 28% from its yearly peak of $495, a retreat that contrasts with the company's continued growth in artificial intelligence chip sales. The decline has unfolded as questions mount across the technology industry about the expense and financing of large-scale AI infrastructure projects. Broadcom supplies custom accelerators and networking components widely used in AI data centers, a position that places its share price at the center of the debate over how the industry's AI buildout will be financed.

AI Funding Questions Weigh on Shares

Chief Executive Hock Tan raised concerns about investor expectations at a conference in Singapore this week. He said that financing could limit data center expansion even as demand for chips remains strong. Semiconductor stocks declined following the discussion.

Other chipmakers faced similar selling. Nvidia shares also retreated amid questions about OpenAI's revenue figures and Microsoft's new AI processor. Broadcom itself fell 4.35% on October 8 before another decline on Monday.

Fresh funding reports added to the uncertainty. The Wall Street Journal reported that Broadcom was seeking more than $50 billion to finance custom chips developed with OpenAI. The report described potential financing rather than a completed transaction. Custom accelerators of this kind are designed around a single customer's workloads rather than sold as general-purpose products, and the size of the reported figure indicates the scale of capital such arrangements can involve.

AI Partnerships Support Revenue Growth

Broadcom reported fiscal third-quarter revenue of $29.6 billion in September, an increase of 86% from a year earlier. AI semiconductor revenue reached $16.7 billion, up 221% year over year. The company also reported $13.7 billion in quarterly free cash flow.

The broader chip industry continues to face pressure. Intel stock weakened as well, as investors weighed financing concerns and losses at Intel's manufacturing unit. Broadcom, meanwhile, introduced additional AI networking products at the October Open Compute Project summit.

The company's agreement with OpenAI covers 10 gigawatts of custom accelerator deployments through 2029. Broadcom also works with Google on custom chips. Separately, a platform backed by Apollo and Blackstone targets more than 20 gigawatts of AI computing capacity through 2028. Gigawatt-scale targets, which measure the electricity consumed by data center computing, have become a standard yardstick for sizing AI infrastructure commitments across the industry.

Valuation and Forecasts Remain in Focus

Broadcom's share price has declined despite this series of agreements. The company has emerged as one of the central suppliers of custom silicon for AI computing through partnerships spanning several of the industry's largest players. It extended its chip relationship with Apple through 2031, including a reported $30 billion purchasing commitment. Investors continue to weigh the expected sales against the capital required to support future projects.

Recent research on AI stock concentration has also shown how heavily major indexes rely on technology companies. Broadcom trades at about 31 times expected earnings, compared with a cited sector median near 23, a gap that reflects the premium attached to its AI-linked growth. Such estimates can change as share prices move and profit forecasts are revised.

Broadcom expects fourth-quarter revenue near $34.8 billion, with AI semiconductor sales reaching $21.7 billion. Those figures represent company guidance rather than reported results. The next quarterly report will show whether AI chip sales reach the guided level, and any confirmed financing for the reported OpenAI program would clarify the capital picture behind the company's largest AI commitments.