STORY: The AI boom isn't boosting all chip stocks equally.
Shares in Broadcom plunged as much as 13% Wednesday after its outlook for demand disappointed investors.
The U.S. firm said it expects AI chip revenue of $16 billion in the third quarter, a little below expectations.
Revenue for the previous period also fell short of Wall Street hopes.
Chief Executive Hock Tan said Broadcom was leaving its long-range forecast for AI chip sales unchanged at $100 billion.
The firm's ability to meet demand has been strained by supply chain issues.
It also faces a growing threat from rivals like Marvell Technology, which is making inroads with sales to tech giants.
Even so, Broadcom remains a major beneficiary of the AI investment race.
Analysts say it has a strong position in custom chips.
They are in hot demand amid the rise of inference - the process by which chatbots respond to user queries.
Big Tech firms like Alphabet and Microsoft are expected to spend some $700 billion on AI infrastructure this year, with much of that money set to flow to chipmakers.
