Will Stargate benefit AVGO or QCOM?

Broadcom (AVGO) and Qualcomm (QCOM) are poised to benefit from the Stargate initiative.

1. Broadcom (AVGO): Broadcom's stock rose by 1.54% following the announcement of the Stargate data center project, driven by the heightened demand for semiconductor products. The company's diverse product portfolio, including wireless, networking, broadband, storage, and industrial solutions, positions it well to capitalize on the increased demand for AI infrastructure. Mizuho Securities analyst Vijay Rakesh estimates that Broadcom's new Trainium platform could grow its serviceable addressable market to between $60 billion and $90 billion, from $20 billion in 2024. Broadcom's ownership of intellectual property rights for chip architecture, software, and packaging also enhances its competitive position within the Stargate project.
2. Qualcomm (QCOM): Qualcomm's stock experienced a notable increase, along with other semiconductor companies, due to the Stargate announcement. As a leading mobile AI integration company with its Snapdragon chips, Qualcomm is well-positioned to benefit from the increased focus on AI infrastructure development. While specific details of Qualcomm's involvement with Stargate are not available, the company's strategic role in mobile AI integration suggests that it could contribute to Stargate's goals of building advanced AI infrastructure.

Both Broadcom and Qualcomm are expected to benefit from the Stargate initiative due to their significant contributions to the project and their positions as key technology providers. Broadcom's expertise in custom silicon and high-performance networking solutions, along with its substantial addressable market growth, positions it as a major beneficiary. Qualcomm's role in mobile AI integration and its strategic partnerships in the AI space make it well-positioned to benefit from the increased demand for AI infrastructure.