NVIDIA Stock vs Broadcom Stock: NASDAQ:NVDA and NASDAQ:AVGO AI Arms Race

NVIDIA (NASDAQ:NVDA) vs Broadcom (NASDAQ:AVGO): Two AI Giants, Two Distinct Paths

NVIDIA Stock Price and Market Position

NVIDIA (NASDAQ:NVDA) closed at $166.89, down 2.8% on September 5, 2025, after briefly touching $169.03 during the session. With a $4.1 trillion market cap, NVDA is the single largest force in the AI hardware economy, commanding roughly 94% share of the GPU market used for advanced AI training and inference. Over the past two years, the stock has climbed more than 1,070% since early 2023, fueled by the AI supercycle, even after consolidating in recent weeks.

The company’s most recent quarter was another blockbuster. Revenue surged 56% year-over-year to $46.7 billion, with the Data Center segment contributing $41.1 billion, also up 56%. Gross margins hit 72.7%, one of the highest levels across all of technology. Guidance for Q3 came in at $54 billion at the midpoint, signaling another double-digit revenue jump. Despite export restrictions in China, NVIDIA’s pipeline remains intact thanks to hyperscaler demand from Amazon, Microsoft, Google, Oracle, and Meta, which are locked in a race to expand AI clusters.

The Blackwell GB300 AI superchip is already shipping at a pace of 1,000 units per week, delivering performance leaps of 7x faster training and 50x greater energy efficiency in inference compared with the Hopper generation. These advances solidify NVIDIA’s technological moat and explain why hyperscalers continue to allocate record AI budgets directly to NVDA’s rack-scale solutions.

Looking ahead, analysts forecast NVIDIA’s Data Center revenue could hit $75 billion per quarter by 2026 and $500 billion annually by 2028. At that scale, NVDA’s stock could easily test $350–$400 per share within three years, depending on margins and valuation multiples. Current forward P/E stands around 39x, more expensive than peers but arguably justified given the projected 50% CAGR through the decade.

Broadcom Stock Price and Growth Momentum

Broadcom (NASDAQ:AVGO) trades at $334.21, up 9.18% after its latest earnings release, giving the company a $1.6 trillion market cap. Unlike NVIDIA, Broadcom is not the pure-play GPU leader but has carved a critical position in custom AI accelerators, networking chips, and enterprise software via VMware.

Q3 results demonstrated Broadcom’s balanced growth. Revenue rose 22% year-over-year to $15.95 billion, while adjusted EBITDA hit $10.7 billion, representing 67% margins. Free cash flow was a remarkable $7 billion, about 44% of revenue, showing the efficiency of its dual semiconductor-software model.

The standout metric was Broadcom’s AI revenue: $5.2 billion in Q3, up 63% YoY, with guidance for Q4 at $6.2 billion (+66% YoY). That puts Broadcom on pace for $20+ billion annualized AI revenue, a figure that is still dwarfed by NVIDIA’s $40+ billion per quarter but highlights AVGO’s growing role. The company’s $110 billion backlog, bolstered by a new $10 billion XPU order from a fourth hyperscaler, provides rare revenue visibility and stability in a volatile sector.

Broadcom’s approach is different. Instead of competing directly with NVIDIA’s GPU dominance, it supplies hyperscalers with custom silicon solutions and networking infrastructure, enabling them to build proprietary AI accelerators. It’s a lower-profile role but one that embeds Broadcom deep into the AI supply chain.

Valuation and Comparative Metrics

At today’s levels, NVIDIA trades on 27x next year’s expected earnings and nearly 39x forward P/E, while Broadcom commands a TTM P/E of 111x after its stock surge. NVIDIA looks more expensive compared to the sector average, trading 72% above peers, but it is cheaper than AVGO when measured on forward earnings and price-to-cash-flow multiples.

• NVIDIA (NVDA): $166.89 share price, $4.1T market cap, $46.7B Q2 revenue, 72.7% gross margin, 56% YoY growth.

• Broadcom (AVGO): $334.21 share price, $1.6T market cap, $16B Q3 revenue, 63.1% gross margin, 22% YoY growth.

On free cash flow, Broadcom shines with $7B FCF in a single quarter, about 44% of revenue, while NVIDIA prioritizes reinvestment to maintain its lead in GPUs and rack-scale systems. This makes AVGO attractive to income-focused investors, especially given its 0.69% dividend yield compared with NVIDIA’s negligible payout.

Geopolitical Exposure

NVIDIA’s biggest risk is geopolitical. China once represented over 13% of its revenue but fell to 6% by FY26. U.S. export restrictions block shipments of advanced GPUs like the H100 and Blackwell, limiting potential sales. A recent deal allowing 15% export tariffs on H20 GPUs could open $2–$5B in sales, but domestic rivals like Huawei, Biren, and Moore Threads are building alternatives with state support. For NVIDIA, the West remains the core growth engine.

Broadcom faces less direct political risk. Its AI wins come from U.S. and European hyperscalers, with limited exposure to Chinese regulatory issues. However, its dependency on a small set of hyperscaler clients poses another kind of concentration risk — if any major customer delays capex, AVGO’s AI revenue could dip significantly.

Final Take: Hypergrowth vs Cash Flow Stability

Choosing between NASDAQ:NVDA and NASDAQ:AVGO comes down to risk tolerance and investment horizon. NVIDIA offers hypergrowth, with AI superchip sales that could take revenue from $200B today to $700B by FY29, but investors must accept export risk, valuation compression, and customer concentration. Broadcom, by contrast, offers cash flow stability, dividends, and a $110B backlog that insulates near-term volatility, but its growth ceiling is lower.

• NVIDIA (NVDA): Buy for aggressive growth investors seeking $350–$400 upside by 2028.

• Broadcom (AVGO): Buy/Hold for investors preferring compounding free cash flow and dividend income with moderate AI exposure.

Both are winners in the AI arms race — NVIDIA as the platform leader, Broadcom as the essential supplier.

That's TradingNEWS