Nvidia and Broadcom: Here's How These Top AI Stocks Are Doing 1 Year After Their Stock Splits

Core Viewpoint - Stock splits have gained popularity among major companies, particularly in the AI sector, with Nvidia and Broadcom completing significant splits in mid-2024 to make their shares more accessible to investors [1][2]. Group 1: Stock Split Overview - A stock split allows companies to lower their stock price, making shares more accessible to a wider range of investors [2]. - Nvidia and Broadcom executed 10-for-1 stock splits, reducing Nvidia's share price from approximately $1,200 to $120 and Broadcom's from about $1,700 to $170 [6][10]. - Stock splits do not alter the total market value of a company; they simply increase the number of shares held by investors [3]. Group 2: Nvidia's Performance Post-Split - Following its stock split, Nvidia's shares have gained over 40%, driven by high demand for its AI chips and GPUs [6][7]. - The successful launch of Nvidia's Blackwell architecture generated $11 billion in revenue in its first quarter, maintaining a gross margin above 70% [8]. - Optimism surrounding trade talks and continued AI investment plans have contributed to Nvidia's stock performance, pushing its market cap to $4 trillion [9]. Group 3: Broadcom's Performance Post-Split - Broadcom's stock has risen more than 65% since its split, fueled by increased demand from AI customers and cloud service providers [10][11]. - In the latest quarter, Broadcom reported a 77% surge in AI revenue to $4.1 billion, with expectations for continued growth [12]. - Broadcom's diverse product offerings and networking expertise have been crucial in supporting the AI development of cloud service providers [13]. Group 4: Future Outlook - Both Nvidia and Broadcom have experienced successful post-split years with double-digit gains, indicating strong market positions in the AI sector [14]. - Nvidia's valuation is slightly lower than a year ago, while Broadcom's valuation has increased [14]. - The current market environment suggests potential for further gains for both companies, as they are well-positioned for long-term success in the AI market [16].