Why Is Broadcom Stock Falling On Tuesday?

Broadcom Inc (NASDAQ:AVGO) shares traded lower on Tuesday morning. The stock dropped approximately 1.5% in early trading as the decline follows a broader market retreat and a rally on Monday.

Nasdaq futures fell 0.92%, while S&P 500 futures shed 0.45%.

Market Volatility Dampens AI Momentum

The Tuesday dip comes despite significant infrastructure news. On Friday, Bloomberg reported that Apollo Global Management Inc (NYSE:APO) and Blackstone Inc (NYSE:BX) are discussing a $35 billion financing package with Broadcom.

This record-breaking private credit deal would support custom AI chip development.

Microsoft Commitment Remains Key

Broadcom’s partnership with OpenAI remains a focal point, with The Information reporting an $18 billion financing hurdle last week.

Broadcom reportedly wants Microsoft Corp (NASDAQ:MSFT) to commit to purchasing 40% of the initial chip production. Broadcom views this commitment as critical to its confidence in repayment.

Goldman Sachs Maintains Bullish Stance

Despite the Tuesday pullback, analysts see long-term tailwinds. Goldman Sachs analyst James Schneider reiterated a Buy rating Sunday.

He maintained a $480 price forecast. Schneider noted that “agentic AI” will sharply increase global token consumption.

Broadcom continues to scale its AI infrastructure footprint. The company recently expanded partnerships with Alphabet Inc (NASDAQ:GOOGL) (NASDAQ:GOOG), Anthropic and Meta Platforms Inc (NASDAQ:META).

AVGO Price Action: Broadcom shares were down 1.73% at $421.00 at the time of publication on Tuesday. The stock is approaching its 52-week high of $437.68, according to Benzinga Pro data.

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