2 AI Stocks to Strengthen Your Long-Term Portfolio: Broadcom and ServiceNow

Broadcom and ServiceNow are two AI stocks with a long history of delivering market-beating returns. Broadcom supplies chips and networking components for the data center market, while ServiceNow provides AI software to automate workflows. Both companies have a subscription-based business model and are expected to continue growing as demand for AI infrastructure increases. Broadcom's recent earnings reports show its data center business is booming, with sales of AI chips growing 46% year over year. Analysts expect Broadcom's revenue to grow at an annualized rate of 20% through 2027. ServiceNow has a revenue growth rate of 32% annualized over the last 10 years, fueled by a 1,100% return for shareholders.

As AI continues to reshape industries, two companies stand out for their robust performance and growth potential: Broadcom Inc. (NASDAQ: AVGO) and ServiceNow Inc. (NYSE: NOW). Both companies have a long history of delivering market-beating returns, and their recent earnings reports underscore their strong positions in the AI-driven market.

Broadcom: The AI Chip and Networking Powerhouse

Broadcom is a leading supplier of chips and networking components for the data center market. The company's recent earnings reports highlight a booming data center business, with sales of AI chips growing 46% year-over-year [1]. This growth is fueled by soaring investments in data infrastructure by major tech companies such as Microsoft (NASDAQ: MSFT), Meta Platforms (NASDAQ: META), Alphabet (NASDAQ: GOOGL), and Apple (NASDAQ: AAPL), which are expected to spend over $400 billion on AI infrastructure through 2026 [1].

Broadcom's strategic positioning in the AI market is evident in its recent product launches, such as the Jericho4 ethernet fabric router, built on a 3nm process, which delivers high-bandwidth, secure, lossless connectivity across data centers [1]. The company is also well-positioned to capture a meaningful slice of the accelerator market, with analysts projecting a 10%–15% long-term market share driven by rising AI compute and networking demand [1].

ServiceNow: AI Software for Automating Workflows

ServiceNow, on the other hand, provides AI software to automate workflows and optimize business processes. The company has successfully transitioned from an AI promise to a profitable reality, as evidenced by its recent decision to raise its full-year 2025 forecast [3]. ServiceNow's bullish outlook is powered by its proven ability to monetize AI innovations and strategic moves to expand its competitive advantage [3].

ServiceNow's subscription-based business model has proven to be a durable path toward achieving its ambitious growth targets. The company's revenue growth rate of 32% annualized over the last 10 years, fueled by a 1,100% return for shareholders, underscores its strong market position [3].

Investment Outlook

Both Broadcom and ServiceNow are well-positioned to benefit from the growing demand for AI infrastructure. Broadcom's strong data center business and strategic product launches make it an attractive investment for those seeking exposure to the AI chip and networking market. ServiceNow's proven ability to monetize AI innovations and its durable growth model make it an appealing choice for investors seeking AI software solutions.

References

[1] https://finance.yahoo.com/news/broadcoms-ai-push-gains-speed-103329002.html
[2] https://www.ainvest.com/news/big-wave-ai-infrastructure-nvidia-broadcom-tsmc-owns-long-term-growth-2508/
[3] https://www.investing.com/analysis/servicenow-translates-ai-hype-into-tangible-revenue-and-durable-growth-200665759