A variety of technology industry officials, including Broadcom Inc., Apple Inc.’s chip supplier, provided a depressing outlook for the upcoming quarter, indicating that demand for electronic components is still weak.

The forecast indicates that Broadcom is trapped in a severe cost slump, even though the AI surge is driving demand in some key sectors. It produces important parts for Apple’s iPhone, whose sales have decreased. Spending in this sector has been uneven, even though Broadcom controls the market for semiconductors that help transport traffic between computers in enormous data centers.

Broadcom has not been able to match the strong sales growth of rival chipmaker Nvidia Corp., despite its success in the AI field. Nvidia’s artificial intelligence accelerators, which assist so-called massive language models in processing enormous amounts of data, are in high demand, fueling the company’s $1 trillion valuation.

In contrast, Broadcom continues to get the majority of its money from industries that are developing slowly or not at all. The smartphone sector is included in this.

Following the release of the quarterly report, shares of Broadcom decreased more than 4% at the close of trading, bringing their year-to-date gain to 65%.

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