Quick Read
Soros Fund Management initiated positions in Broadcom (AVGO) and Tesla (TSLA) worth a combined $69M in Q4.
Broadcom’s Q4 AI chip revenue reached $6.5B (up 74% YoY). Q1 guidance is $8.2B (100% growth).
Tesla is investing $30B to $70B in AI and robotics including FSD software and Optimus humanoid production.
A recent study identified one single habit that doubled Americans’ retirement savings and moved retirement from dream, to reality. Read more here.
Billionaire George Soros has long been a controversial investor. In 1992, he shorted the British pound in a bet that earned him $1 billion and contributed to the Bank of England’s withdrawal from the European Exchange Rate Mechanism, an event dubbed Black Wednesday. More recently, through his Open Society Foundations, Soros has funded progressive political causes, drawing criticism from conservative groups.
Despite the debates, few doubt his investing acumen. He remains smart, sharp, and savvy. His Soros Fund Management recently filed its fourth-quarter 13F with the SEC, disclosing various trades, including new positions in a number of new stocks. Two notable artificial intelligence (AI)-related picks are Broadcom (NASDAQ:AVGO) and Tesla (NASDAQ:TSLA), where the fund invested a combined $69 million.
While these moves signal confidence in their AI-driven recoveries despite year-to-date declines, let’s dive into what may have particularly attracted Soros to them.
Broadcom’s Bet on Custom AI Chips
Soros Fund Management initiated a position in Broadcom by purchasing 102,379 shares valued at approximately $35.4 million, indicating an average purchase price of around $345 per share. Broadcom closed out the week around $325, a 5.7% decline. However, the chipmaker has faced headwinds this year, stemming from increased uncertainty over U.S. export licenses for high-end AI chips to China, where the government extended reviews on national security grounds, prompting some Chinese customers to delay orders.
Broader geopolitical tensions, including U.S. efforts to acquire Greenland and potential new tariffs against European allies, have also fueled a risk-off mood in tech stocks, dragging down the Nasdaq index and major players like Broadcom. Additionally, concerns over gross margin compression from shifts in product mix have weighed on sentiment, though analysts view these as overstated given AI’s profit contributions.
Soros may see value in Broadcom’s strong positioning in the AI semiconductor market, which could drive a rebound. The company’s AI chip revenue reached $6.5 billion in Q4, up 74% year-over-year, and management guided for $8.2 billion in Q1, representing 100% growth. This surge is fueled by demand for custom AI accelerators from hyperscale customers like Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL) and Meta Platforms (NASDAQ:META), helping them reduce reliance on Nvidia (NASDAQ:NVDA).
Broadcom holds a dominant role in merchant silicon for high-speed switching and routing, as well as custom accelerators, with technology leadership and scale advantages supporting profitability. Analysts project AI semiconductor sales to double as a portion of revenue in 2026, potentially exceeding half of total sales by year-end. Overall revenue is expected to grow 52% in fiscal 2026, reaching about $94 billion, driven by AI and infrastructure software from the VMware acquisition.
With hyperscalers like Google planning 97% higher capex in 2026 for AI infrastructure, Broadcom’s custom chip pipeline positions it for sustained gains. The stock’s forward earnings multiple of around 22x, amid projected 50% EPS growth, suggests room for significant appreciation if AI demand holds.
Tesla’s Push Into AI Autonomy
For Tesla, Soros acquired 56,661 shares worth about $25.5 million in Q4 — an implied average buy price of $450 per share. The electric vehicle (EV) maker’s stock has dropped roughly 7% since to $417 per share. Key factors in the decline include a sharp sales pullback in Europe, with new registrations falling over 40% in markets like France, the Netherlands, and Norway due to fading incentives and rising competition from Chinese rivals like BYD and traditional automakers like Volkswagen.
Overall revenue dipped 2.9% year-over-year in recent quarters amid lower vehicle deliveries, while capital demands for AI and robotics projects escalated to $30 billion to $70 billion. Leadership changes in global sales and bearish retail sentiment, focusing on execution risks for robotaxis, have added pressure. Broader market selloffs tied to geopolitical issues have also contributed to the slide.
Soros could be wagering on Tesla’s transition to an AI and robotics leader, which may propel shares higher. The company is investing heavily in AI initiatives, including unsupervised Full Self-Driving (FSD) software, the Cybercab robotaxi, and the Optimus humanoid robot, with this year’s capex set to surge beyond 2025 levels.
Tesla’s AI approach emphasizes end-to-end neural networks for perception, planning, and control, outputting 1,000 predictions per timestep to enable autonomy in vehicles and robots. Optimus production is ramping, with targets of 50,000 to 100,000 units in 2026 and a dedicated facility at Giga Texas under construction — Musk projects it could represent 80% of Tesla’s value long-term.
FSD subscriptions offer high-margin recurring revenue, while robotaxi deployments in Austin and the Bay Area aim for scale, potentially shifting valuation from EVs to software. A $2 billion investment in xAI that just merged with SpaceX supports potential collaborations, and Musk’s 2026 deadline for AI breakthroughs underscores the goal of agentic AI systems for real-world tasks.
Analysts forecast 2026 net income around $6.1 billion, up from prior estimates, as pivoting to AI can offset auto weakness, with some bulls even eyeing a $5 trillion market cap if robotics succeeds.
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