NVIDIA Corporation (NVDA)vs Broadcom Inc. (AVGO)

Quick verdict

Return on invested capital is where these two separate most sharply: NVIDIA converted capital into a 69.1% ROIC over the twelve months to July 2026, against 30.0% at Broadcom for the twelve months to August 2026. Both are strong figures by any industrial standard, but one is more than double the other, and it flows straight from margins — a 65.2% operating margin versus 48.1%. On the headline numbers our scoring gives NVIDIA growth, quality and balance sheet, Broadcom the income factor, with valuation and momentum too close to call and an overall tally of 4 to 2. At the 4 September 2026 close NVIDIA carried a $5,551.7bn market capitalisation against Broadcom's $1,708.5bn, roughly three times larger, on revenue of $303.0bn versus $89.1bn. Broadcom's case rests on dividends and software breadth rather than on out-earning NVIDIA per dollar deployed.

At-a-glance comparison

Business model and revenue mix

Both sit in semiconductors, but they monetise very differently. NVIDIA designs GPUs and accelerated-computing platforms sold into data-centre AI, gaming, professional visualisation and automotive, a concentrated product stack that produced $303.0bn of revenue in the twelve months to July 2026. Broadcom spans networking, broadband, storage and wireless silicon and layers on infrastructure software including VMware, generating $89.1bn over the twelve months to August 2026. That software component is visible in the financial profile: a 68.8% gross margin, recurring licence economics and a payout ratio of 31.6% that funds a 0.71% dividend yield. NVIDIA's model is more cyclical in nature and reinvestment-heavy, returning just 3.5% of earnings as dividends. Fiscal calendars differ — NVIDIA closes in January, Broadcom in November — so the latest fiscal years are labelled 2026 and 2025 respectively.

Valuation

On valuation our verdict is a genuine tie, because the two are expensive in different places. Broadcom trades on 45.7 times trailing earnings against NVIDIA's 29.1, and on 33.9 times EV/EBITDA versus 27.6 — cheaper on neither. Yet price-to-sales is almost identical at 18.3 for NVIDIA and 19.2 for Broadcom, and free cash flow yields are effectively the same, 2.29% against 2.31%, both measured at the 4 September 2026 close. Price-to-book favours Broadcom at 17.1 times versus 24.2, though book value means little for asset-light chip designers. The sharpest contrast is the PEG ratio: 0.14 for NVIDIA against 2.11 for Broadcom, a function of the growth rates plugged into it rather than of price alone. Adjust for growth and NVIDIA looks cheaper; ignore growth and Broadcom does on cash-flow parity.

Growth profile

Nothing in this pair is close on growth. NVIDIA compounded revenue at 100.1% a year from fiscal 2023 to fiscal 2026 and at 66.9% a year from fiscal 2021, with earnings per share growing 206.6% annually over the three-year span. Broadcom's equivalents are 24.4% revenue growth from fiscal 2022 to fiscal 2025, 21.7% from fiscal 2020, and 21.6% EPS growth over three years. Two caveats are worth stating plainly. NVIDIA's three-year figures start in fiscal 2023, before the data-centre AI build-out inflected, so the base is a low one and the rate flatters accordingly. Broadcom's growth, by contrast, is partly acquisitive, reflecting the VMware software addition. Even allowing for both, the gap is wide enough that the growth verdict goes to NVIDIA without much argument.

Profitability and quality

Margins explain the returns gap. Over the twelve months to July 2026 NVIDIA held a 74.7% gross margin, 65.2% operating margin and 63.7% net margin, turning $303.0bn of revenue into $192.9bn of net income and $127.0bn of free cash flow. Broadcom, for the twelve months to August 2026, reported 68.8% gross, 48.1% operating and 42.9% net margins, producing $38.3bn of net income and $39.4bn of free cash flow on $89.1bn of revenue. Broadcom's free cash flow slightly exceeds its net income, consistent with heavy non-cash amortisation from acquired software; NVIDIA's sits well below net income, reflecting working-capital absorption in a fast-scaling business. Operating income is reported on a stated line for both, so no adjustment is needed. On quality the verdict is NVIDIA, driven by the margin structure rather than by any single ratio.

Balance-sheet risk

Leverage is modest at both, but not equally so. NVIDIA held $22.4bn of cash against $33.4bn of total debt as at 26 July 2026, leaving net debt at just 0.05 times EBITDA, a current ratio of 4.59 and interest cover of 426 times. Broadcom, as at 2 August 2026, carried $24.0bn of cash against $59.4bn of debt — net debt of 0.69 times EBITDA, a current ratio of 2.50 and interest cover of 13.7 times. Broadcom's borrowings are the legacy of its acquisition-led strategy, and 13.7 times cover is comfortable in absolute terms; it simply is not in the same bracket as NVIDIA's. Shareholders' equity stands at $229.0bn for NVIDIA and $99.7bn for Broadcom. The balance-sheet verdict goes to NVIDIA on lower gearing and vastly greater headroom against interest costs.

Price performance and shareholder returns

This is the page's central divide. NVIDIA's 69.1% return on invested capital and 117.2% return on equity dwarf Broadcom's 30.0% and 44.3%. ROIC is the fairer comparator here: Broadcom's equity base has been enlarged by acquisition accounting, which depresses ROE relative to a business that has grown organically, so the invested-capital measure strips out some of that distortion — and the gap survives it. On shareholder returns the ranking flips. Broadcom pays $2.54 per share for a 0.71% yield on a 31.6% payout ratio, while NVIDIA pays $0.28 for a 0.12% yield on a 3.5% payout. NVIDIA buys back more, at a 1.00% buyback yield against 0.49%. So capital is earning far more inside NVIDIA; rather more of it is being handed out at Broadcom.

Which stock fits which investor

Income-oriented holders have a clear preference: Broadcom's 0.71% yield and 31.6% payout are the only meaningful dividend proposition in this pair, NVIDIA's 0.12% being effectively a token. Growth and quality investors point the other way, towards 100.1% three-year revenue compounding and a 69.1% ROIC, though the growth figure is measured from a fiscal 2023 base that predates the AI build-out and should be read with that in mind. Value investors have no clean answer — the free cash flow yields are 2.29% and 2.31%, near identical, and the two trade on similar price-to-sales even as their P/E ratios diverge. Both carry the same style tag of high-growth, high-quality. Neither is priced as a bargain; the choice is between paying 45.7 times earnings for dividends and diversification, or 29.1 times for concentration and superior returns on capital.

• Value: Too close to call
• Growth: NVDA
• Income: AVGO
• Quality: NVDA

Frequently asked questions

Which company earns more on the capital it deploys?

NVIDIA, by a wide margin. Its return on invested capital was 69.1% over the twelve months to July 2026, against 30.0% at Broadcom for the twelve months to August 2026. Return on equity shows the same ordering, 117.2% versus 44.3%.

Is NVIDIA cheaper than Broadcom?

It depends on the measure, which is why our valuation verdict is a tie. NVIDIA trades on 29.1 times trailing earnings versus Broadcom's 45.7, but their free cash flow yields at the 4 September 2026 close are almost identical at 2.29% and 2.31%, and price-to-sales is 18.3 against 19.2.

Which pays the better dividend?

Broadcom. It paid $2.54 per share over the trailing twelve months for a 0.71% yield on a 31.6% payout ratio, while NVIDIA paid $0.28 for a 0.12% yield and a 3.5% payout. NVIDIA instead returns more through buybacks, at a 1.00% buyback yield versus 0.49%.

How large is the size gap between the two?

NVIDIA's market capitalisation was $5,551.7bn at the 4 September 2026 close, roughly three times Broadcom's $1,708.5bn. On revenue the gap is wider still: $303.0bn for NVIDIA in the twelve months to July 2026 against $89.1bn for Broadcom to August 2026.

Which balance sheet is stronger?

NVIDIA's. Net debt stood at 0.05 times EBITDA as at 26 July 2026, with a 4.59 current ratio and 426 times interest cover. Broadcom carried $59.4bn of total debt as at 2 August 2026, giving 0.69 times net debt to EBITDA and 13.7 times interest cover — comfortable, but a different order of headroom.

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