Core Insights - The market reaction to Broadcom's recent performance is primarily driven by concerns over revenue expectations rather than actual sales figures, which include a significant backlog of $73 billion [1] - Broadcom's AI sales exceeded expectations, with a forecast for the next quarter of $8.2 billion, significantly higher than the consensus of $6.8 billion, indicating strong year-over-year growth [2] - Concerns regarding the margin structure of the anthropic deal, which involves $21 billion of sales, are contributing to investor apprehension, as the TPU system sale is expected to have lower margins compared to previous sales [3] Company Positioning - Broadcom is positioned as a leader in infrastructure spending, particularly in networking and compute, similar to Nvidia, controlling two of the three main segments [4] - The company is moving towards a full solution stack for AI, which includes both compute and networking capabilities, a strategy that is being overlooked by some investors during the current sell-off [5] - Broadcom's offerings in the full solution stack across networking and compute are unique in the tech industry, making it one of the few companies with such capabilities [8] Market Dynamics - The competitive landscape indicates that Broadcom's success does not necessarily come at the expense of other companies, as hyperscalers are adopting a mix of custom compute and GPUs for model training [7] - Supply chain challenges are evident, with companies like Dell increasing prices due to memory costs and Oracle facing delays in data center deployments, indicating a tight infrastructure market [9] - The overall visibility across the supply chain is improving, with companies like Broadcom and Nvidia benefiting from long-term demand projections, despite current tightness in certain areas like optical transceiver components [11][12]