Broadcom Inc.’s expanding partnerships with leading AI labs could generate significant revenue growth over time but also add meaningful counterparty and customer concentration risks. Expanding residual value support (RVS) to drive such growth exposes the company to tail risk in the event of an AI industry downturn. Therefore, we revised our outlook on Broadcom to stable from positive and affirmed all our ratings on the company, including our ‘A-’ issuer credit rating. The stable outlook reflects our expectation that Broadcom's operating performance will remain solid over the next one to two years as strong tailwinds boost AI semiconductor sales, while a sticky customer base continues to provide stability in the non-AI semiconductor and software segments. This is offset by Broadcom’s
