Broadcom shares dropped 4.7% in Frankfurt on Friday a day after the company projected first-quarter revenue above Wall Street estimates, but said margins would fall due to a higher mix of AI revenue.

That fall was broadly in line with its U.S. after-hours move.

Broadcom has jumped into the AI chip business, which has investors nervous about the profitability and costs of enormous investments.

The company has a backlog of $73 billion that it anticipates shipping over the next 18 months, CEO Hock Tan said on a post-earnings call, but his lieutenant said profit margins could drop.