Home / Business and Economy / AI chip outlook dims, sparking global selloff
AI chip outlook dims, sparking global selloff
6 Jun
Summary
- Global chip stocks experienced a broad selloff.
- Broadcom's guidance miss impacted AI chip spending forecasts.
- Nvidia CEO endorsed Marvell, citing its essential infrastructure role.
Global chip stocks experienced one of the year's broadest selloffs on 2026-06-06. This downturn was triggered by Broadcom's earnings guidance and a robust jobs report. The guidance miss from Broadcom reset expectations for the pace of hyperscaler AI chip spending, a key growth driver for the sector.
The stronger-than-expected jobs report also dampened hopes for near-term interest rate cuts, introducing potential rate hike risks by year-end. Semiconductor valuations, which rely on optimistic earnings projections, are particularly sensitive to changes in discount rates.
Despite the broader market decline, Marvell Technology (MRVL) garnered significant positive attention. Nvidia CEO Jensen Huang lauded Marvell as a "trillion-dollar company," emphasizing its critical role in AI data center connectivity infrastructure. Nvidia has also committed $2 billion in investment to Marvell.
Marvell reported record Q1 FY27 revenue of $2.418 billion, a 28% year-over-year increase, with management noting exceptional AI-related bookings. The company raised its full-year FY27 revenue target to approximately $11.5 billion, projecting custom AI chip business growth exceeding 20% in FY27 and doubling in FY28. Q2 guidance projected $2.7 billion in revenue, representing 35% year-over-year growth.
