Advanced Micro Devices (NASDAQ:AMD | AMD Price Prediction) and Broadcom (NASDAQ:AVGO) both posted AI quarters that force investors to rethink what pairs well with NVIDIA (NASDAQ:NVDA). One is positioning itself as the second GPU vendor hyperscalers can lean on. The other is building the custom silicon and networking that sits alongside Jensen Huang’s platform as a complement.
Instinct Carries AMD. Custom XPUs Carry Broadcom.
AMD’s Q2 landed on August 4, 2026 with revenue of $11.54 billion, up 50.1% year over year, and non-GAAP EPS of $1.66. Data Center contributed $6.72 billion, up 107%, now 58% of the company. Lisa Su told investors AMD enters the second half “with strong momentum as EPYC demand accelerates, Instinct deployments scale and Helios begins to ramp.” Anthropic, Meta and Microsoft Azure are all MI450 customers, the real story behind the numbers.
Broadcom reported on June 3, 2026: revenue of $22.19 billion, up 47.9%, and AI semiconductor revenue of $10.80 billion, up 143%. Hock Tan guided Q3 AI revenue to $16.0 billion, over 200% growth, on custom accelerators and Tomahawk/Jericho switching silicon for hyperscalers.
| Driver | AMD | Broadcom |
| Main AI engine | Instinct GPUs, EPYC CPUs | Custom XPUs, AI networking |
| Relationship to NVIDIA | Direct competitor | Adjacent partner |
| Q3 guide | ~$13B, +41% | ~$29.4B, +84% |
Merchant Silicon vs. Adjacent Silicon
AMD is pitching itself as the second source for discrete datacenter GPUs, fighting NVIDIA over the same rack. Broadcom designs bespoke chips for Google, Meta and others while owning the Ethernet fabric between them. Margins reflect the split: AMD’s non-GAAP gross margin sat at 56%, while Broadcom’s adjusted EBITDA margin held at 69% of revenue, with free cash flow of $10.26 billion in the quarter. Broadcom pays a $0.65 quarterly dividend and repurchased $600 million in stock. AMD returns nothing to shareholders in cash.
The Next Test Is Whether Hyperscalers Split the Order Book
Watch whether AMD’s MI450 shipments to Anthropic (up to 2 GW) and Meta translate into repeat orders once Blackwell 300 saturates. For Broadcom, the tell will be whether Q3 AI revenue clears $16 billion bar traders currently give a 62% probability. AMD is off 15.83% over the past month, while Broadcom is up 7.69% on the week.
Why I Lean Broadcom for the Second Slot
Paired with NVIDIA, Broadcom is the cleaner complement. Broadcom offers broader exposure across AI networking, custom hyperscaler chips, higher margins, and lower single-point architectural risk. If you believe hyperscalers will force a dual-vendor GPU market and squeeze NVIDIA’s pricing, AMD is the direct hedge. At a trailing P/E near 123 for AMD versus 71 for Broadcom, the adjacent silicon play offers a cleaner thesis than the head-on fight.
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