Nvidia and Broadcom’s AI momentum remains, but the “too late” question is shifting to valuation

Shares of Nvidia and Broadcom have kept climbing alongside the AI buildout, but a new round of investor hand-wringing is focusing on a different issue. Instead of asking whether the companies are real beneficiaries of AI demand, investors are increasingly asking whether their stock prices already assume several more years of exceptional performance.

Nvidia reported record fiscal first-quarter revenue of $81.6 billion for the period ended April 26, 2026, up 85% from a year earlier. Data Center revenue reached $75.2 billion, up 92% year over year, reinforcing that Nvidia’s AI-related growth is no longer just about one product cycle. NVIDIA also reported gross margins of 74.9% (GAAP) and said it returned about $20.0 billion to shareholders in the quarter through buybacks and dividends.

In that same quarter, Nvidia detailed a breakdown that highlights where the AI factory expansion is being felt inside its business. Data Center compute revenue was $60.4 billion, up 77% from a year ago, while Data Center networking revenue was $14.8 billion, up 199% from a year earlier. Nvidia is also in the middle of a reporting shift, moving to two market platforms, Data Center and Edge Computing, with Data Center split into Hyperscale and ACIE (which covers AI clouds, industrial and enterprise).

On the product roadmap side, Nvidia used its earnings period to reinforce the next generation of systems tied to agentic AI, where software performs tasks with less manual intervention. The company has positioned its Vera Rubin platform as the follow-on architecture, saying it is in full production and that Rubin-based products from partners will be available in the second half of 2026. Nvidia’s announcements around Rubin also emphasized next-generation networking and security-related platform features designed for large-scale AI factories.

Broadcom’s AI story has similarly migrated from hype to execution, at least at the earnings level. In its fiscal second-quarter results ended May 3, 2026, Broadcom reported revenue of $22.2 billion, up 48% year over year. The company said AI semiconductor revenue was $10.8 billion, up 143% year over year, driven by custom AI accelerators and AI networking.

Broadcom also offered a forward view inside the quarter. Management said it expects AI semiconductor revenue to grow over 200% year over year to $16.0 billion in the third quarter. That matters because it suggests Broadcom is benefiting not only from orders already shipped, but from continued demand planning by customers building out AI infrastructure.

The valuation question comes from a simple mismatch between fundamentals and expectations. The Motley Fool article framing the debate leaned on academic work suggesting that high growth can still be a risky setup when the market has already priced in years of exceptional performance. For Nvidia and Broadcom, the near-term unknown is not whether AI infrastructure spending is real, but whether results can keep exceeding forecasts at a pace fast enough to justify elevated multiples.

Still, several uncertainties remain that companies do not fully disclose in earnings releases. Nvidia did not provide a complete view in its first-quarter press materials of how revenue growth will evolve under changing export restrictions or how quickly supply constraints will ease across generations. Broadcom’s disclosures around multi-year AI hardware commitments were more specific in regulatory filings than in quarterly results, leaving details such as exact delivery schedules and volume pacing to future reporting. What to watch next is whether each company can translate current strength into durable, quarter-after-quarter results as new platforms ramp and as customers’ AI buildouts move from deployment planning to sustained utilization.