AI Portfolio

Live Blog: Will DeepSeek Impacted Stocks like NVIDIA (NVDA), Broadcom (AVGO) & Marvell (MRVL) Rebound Today?

Eric Bleeker

Published: January 30, 2025 9:00 am

Last Updated: January 30, 2025 9:51 am

Live Updates

Markets Are Open and Broadcom is Soaring

9:48 am

Markets have opened for the day and Broadcom’s gains are accelerating. The stock is up 6.6% following Meta’s comments on its call last night.

Marvell opened up more than 4% before its shares fell, but is now moving north again and trading up 4.3% as of 9:50 a.m. ET.

Meanwhile NVIDIA shares are down .5% in early trading, about where its shares were last night.

How Are Other AI Stocks Trading in Premarket?

8:49 am

The reaction to DeepSeek on Monday led to a sell-off in many AI infrastructure stocks while software stocks got a boost. Let’s check-in at how stocks beyond Marvell, Broadcom, and NVIDIA are performing today.

• ServiceNow (NYSE: NOW): Often listed as a software-beneficiary of efficiency in AI, but its shares are down 10.6% in premarket following an earnings release with disappointing sales and earnings growth.
• Coherent (NYSE: COHR): One of the largest stocks in the ‘optical trade’ is bouncing back in premarket following Meta and Microsoft’s comments on spending last night. Shares are up 2.65%.
• Vistra Corp (NYSE: VST): Another stock that saw the deepest declines on Monday, is up 3.4% in premarket trading.
• Vertiv (NYSE: VRT): The data center stock that specializes in liquid-cooling is up 3.7% in premarket trading.

In Thursday’s premarket trading, the Nasdaq Composite is up about .53% as of 8:30 a.m. ET. The big story last night was earnings reports from many leading stocks in technology.

Companies like Tesla (Nasdaq: TSLA), Meta (Nasdaq: META), Microsoft (Nasdaq: MSFT), IBM (NYSE: IBM), Lam Research (Nasdaq: LRCX), and ServiceNow (NYSE: NOW) all reported and gave more insights into the direction of tech spending.

Of course, the dominant question from Wall Street to companies like Microsoft and Meta was whether they planned to cut aggressive spending plans this year in light of DeepSeek’s potential efficiency breakthroughs.

So far, the responses from Microsft and Meta seemed positive enough for AI infrastructure stocks that most that dropped dramatically on Monday seem headed for a bounceback today. Let’s look at some of these stocks with a particular focus on why Broadcom (Nasdaq: AVGO), Marvell (Nasdaq: MRVL), and NVIDIA (Nasdaq: NVDA) could be on the move today.

Meta’s Earnings Are Good News for Broadcom and Bad News for NVIDIA

Broadcom shares are up 5.2% in premarket trading. Shares jumped following comments in Meta’s conference call last night.

First of all, Meta confirmed their spending plans this year of between $60 to $65 billion in capital expenditures. That’s a big step up from recent estimates and shows that AI spending should continue to grow in 2025.

However, there was Broadcom-specific news in Meta’s conference call. Broadcom is developing a custom ASIC for Meta that will be used in their data centers in much the same way Google uses Broadcom’s TPUs in its data center. The name of these custom ASICs is ‘MTIA.’ Let’s look at a few quotes from Meta’s conference call on where they’ll be utilizing MTIA chips in the year ahead:

• “Finally, we’re pursuing cost efficiencies by deploying our custom silicon in areas where we can achieve a lower cost of compute by optimizing the chip to our unique workloads. In 2024, we started deploying MTIA to our ranking and recommendation influence workloads for ads and organic content. We expect to further ramp adoption of MTIA for these use cases throughout 2025, before extending our custom silicon efforts to training workloads for ranking and recommendations next year.”
• “We’ll continue ramping adoption of those workloads over the course of 2025 as we use it for both incremental capacity and to replace some GPU-based servers when they reach the end of their useful lives. Next year, we’re hoping to expand MTIA to support some of our core AI training workloads and over time, some of our Gen AI use cases.”

The takeaway: When asked about efficiency is their data centers , Broadcom highlighted moving from NVIDIA GPUs to custom chips built by Broadcom. 

DeepSeek becoming the central talking point of the financial world is bad news for NVIDIA for a couple reasons. First, it puts a focus on how many GPUs could be getting through to China and around export controls. Second, a focus on efficiency from data centers could lead to them increasingly talking about differentiation from their custom chips built to compete directly with NVIDIA.

Another Winner from Last Night’s Earnings Calls is Marvell

Broadcom isn’t the only company helping large hyperscalers like Meta build custom chips for their data centers. Their key rival in this space is Marvell (Nasdaq: MRVL), which has partnerships with companies like Amazon and Microsoft.

So any news that hyperscalers are focusing more on custom chips will lead to Marvell moving up in sympathy with Broadcom. The company saw its shares immediately bounce after Meta’s comments, and are now up 4.5% in premarket trading.