Broadcom Extends AI Sell-Off, Lululemon CEO to Step Down, Chipotle CEO Interview12/12/25

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Market insight and analysis. You're listening to the opening bell of CNBC's Squawk on the Street.

Carl Quintanilla (0:51)

Good Friday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with Jim Cramer here at Post 9 of the New York Stock Exchange. Faber has the morning off. Bulls trying to build on Thursday's all-time highs even without the help of AI, which gets some more curveballs today in the guidance from Broadcom. FedSpeak is back. Long bond near 4-9. That's the steepest curve now on Tuesday 10 since 2022 Our roadmap begins with the AI-driven tech slide going into day three now, as Broadcom becomes the latest company to fuel some worries. The president signs this EO, issuing a single regulation framework for artificial intelligence, and that limits the power of the states.

Watching cannabis today as well, surging in the pre-market on some reports, the president will reclassify marijuana, Tilray alone, up more than 30 percent. Let's begin, though, with more weakness in the AI trade, a day after the S&P's first record close since October, Jim. Today, it is Broadcom. Backlog a little light, narrowing margins, no guidance on 26

Jim Cramer (1:49)

You want to buy Broadcom maybe at the opening, maybe if it's a little bit lower.

And you do because the way that the conference call was set up, you found out that the gross margins on one piece of business weren't as good as people thought. So therefore, the overall projection of what they could do did not have the gross margins people want. It's almost as if these people don't know who Hawk Tan is. Hawk saved something. Hawk always has something in his back pocket. This was just a very, very good quarter. Notice everyone raised price target. Almost everybody raised estimates. Look, if it was price target down and estimates down, then you would sell this stock down 25 as it was. But instead, it's the opposite. The numbers are real good. You can see that. Look, it was a difficult thing. I was watching the conference, and I said, okay, what the heck happened? And there were two different things that happened.

The CFO said, hey, listen, this business basically is a rack business medium. It's not as big. And then, you got that moment where you say, where you have, it was following us, the talks is, if the margin commentary was why the stock was down, it's basically, it's an opportunity. We're saying at the club, an opportunity, because at the end of the day, there's more business, even a lower gross margin, maybe a new customer. So there was a new customer, you had a very good business away from that one piece of, one piece of business where the gross margins weren't that good. And everyone just keyed off that and sent the stock down. It's kind of nuts. The key moment was when Hockton said, it's a system sale. He said, boom, it's a system sale, meaning they're not selling individual chips. Now, just to go away from the weeds, this company is on fire. Okay. They have Alphabet, they have Meta, they have ByteDance, they have Anthropic. It's possible, as Ben Right just says, they have OpenAI, it's possible that they have Arm, it's possible they have Apple. They have everybody. So, if you want to sell this stock, it's because you've decided Data Center is dead. Not because it's broken.

Carl Quintanilla (3:48)

Or maybe you just wanted an AI revenue guy for 26

Jim Cramer (3:51)

Well, I just think that Hock is going to give you, Hock's giving you all the customers you want. He's telling you that, look, business is much better than it was a year ago. He did sell a piece of business, one piece of business that was not a discrete unit, but was a rack. I think that you get a chance to buy it because he's done this before. We've heard that things are a little conservative and if the stock goes down, the board members of the direction just go buy it.