Nvidia is in crisis! Broadcom's XPU may seize a large number of GPU orders.

I have witnessed firsthand that NVIDIA's troubles are gradually escalating. Citigroup and Mizuho Securities have consecutively lowered NVIDIA's target price to $200, which is not a good sign.

Broadcom's customized AI chip (XPU) poses a significant threat to Nvidia, and I anticipated this a long time ago. Citigroup analysts predict that by 2026, Nvidia could lose up to $12 billion in GPU sales! This figure is truly astonishing.

Looking at the latest financial report reveals how serious the problem is: Broadcom's AI business grew by 63% year-on-year and secured a $10 billion deal with OpenAI; in contrast, NVIDIA's data center revenue has fallen short of expectations for two consecutive quarters. This trend is concerning.

Top AI companies are quietly shifting from general-purpose GPUs to custom-designed chips, and this transition is happening faster than many anticipated. The customized chip market is expected to grow at an annual rate of 53% by 2026, far exceeding the 34% growth of the AI GPU market. NVIDIA's dominance is under serious challenge!

However, both Citibank and Credit Suisse believe that NVIDIA's position is unlikely to be shaken in the short term. According to Tipranks data, the average target price given by analysts is $211.08, which is still 25.41% higher than the current price.

I believe this optimistic assessment may be overly conservative. As giants seek alternatives, NVIDIA's monopoly advantage may disappear faster than expected. Market competition will only become more intense, and NVIDIA needs to come up with a stronger response, or it may really be eaten away by competitors like Broadcom in terms of market share.