Broadcom projects AI chip sales to exceed $100 billion by 2027 on surging custom silicon demand

Broadcom Forecast Underwhelms Investors in Sign of AI Angst

Broadcom Inc. Chief Executive Officer Hock Tan said the company expects its AI chip sales to top $100 billion next year, marking major inroads into territory dominated by Nvidia Corp. "We have line of sight" to reach this milestone in 2027, he said during a conference call with analysts. "We have also secured the supply chain required to achieve this." The company projects that AI chip revenue will be $10.7 billion in the current quarter, so reaching an annual pace of $100 billion would be a major jump. Broadcom reportedBloomberg Terminal $20 billion in AI sales in 2025. The shares gained about 4% in late trading on Tan's remarks. WATCH: "These are good numbers," Gil Luria, head of technology research at D.A. Davidson, says about Broadcom's first-quarter earnings and revenue guidance. The CEO has increasingly hitched Broadcom's fortunes to AI. Though Nvidia remains the biggest maker of accelerators -- the chips that help train and run artificial intelligence models -- Broadcom has positioned itself as an alternative with its custom-made semiconductors. The company's AI chip targets include both accelerators and networking semiconductors. Broadcom also delivered a better-than-estimated quarterly outlook on Wednesday and announced a stock buyback plan worth as much as $10 billion. Revenue will be about $22 billion in the fiscal second quarter, which ends May 3, the company saidBloomberg Terminal. Analysts had predicted $20.5 billion on average, though some projections topped $22 billion, according to data compiled by Bloomberg. The company had faced skepticism about its AI prospects this year, with Broadcom shares falling 8.3% through the close. Investors have grown more concerned about a bubble in artificial intelligence spending, and even a blockbuster earnings report from Nvidia last month led to a stock selloff. One key question is whether the current AI wave will extend beyond the next few years. Broadcom had seen its valuation surge in recent years, helped by deals to make custom AI chips for companies like OpenAI and Anthropic PBC. Its prospects have also benefited from increased interest in Google's TPU, or tensor processing unit, a chip that Broadcom helps develop for the search giant. And Broadcom just shipped the first units of a new generation of processors that it said will be adopted by about a half-dozen more clients this year. In the fiscal first quarter, which ended Feb. 1, sales rose to $19.3 billion. Profit was $2.05 a share, excluding some items. Analysts had projected revenue of $19.3 billion and earnings of $2.03 per share. AI revenue more than doubled to $8.4 billion in the period, Broadcom said, a faster clip than it anticipated. The increase was "driven by robust demand for custom AI accelerators and AI networking," Tan said in a statement. Even if Broadcom hits its targets, Nvidia will still dwarf the company in AI revenue. Nvidia is expected to generate $333 billion in fiscal 2027 from AI data center customers. Tan said on the conference call that he expects OpenAI to begin shipping its Broadcom chip in volume next year, reaching more than 1 gigawatt of computing capacity. He also said that demand for Google's TPU is strong and will accelerate further in 2027. Broadcom plans to ship chips to Anthropic, which is using Google's TPUs, to enable 1 gigawatt of capacity this year and more than 3 gigawatts next year. Tan also discussed progress with another chip customer, Meta Platforms Inc. He took issue with recent reports that Meta might be moving away from planned work with Broadcom on custom accelerators, saying the road map was "alive and well." Products are shipping now and next-generation versions will "scale to multiple gigawatts in '27 and beyond," he said. Separately, Meta touted its ambitions for the chips on Wednesday. Chief Financial Officer Susan Li said the company was aiming to develop chips that can train its AI models. Beyond Broadcom's custom AI chip work, the company continues to update its networking equipment to better link up the computing needed to run artificial intelligence models. Tan also has built a large software operation through acquisitions. The new buyback plan, which follows $7.8 billion in stock repurchases during the first quarter, will run through the end of the year, the Palo Alto, California-based company said.

Broadcom sees over $100 billion in AI chip sales by 2027 on robust custom chip demand

March 4 (Reuters) - Chip designer Broadcom (AVGO.O), opens new tab on Wednesday projected its artificial intelligence chip revenue would exceed $100 billion by next year, signaling surging demand for custom artificial intelligence chips in a market dominated by Nvidia. The company's share price rose more than 4% in extended trading after it also announced a new share repurchase program of up to $10 billion through the end of the year. Big Tech firms such as Alphabet (GOOGL.O), opens new tab, Microsoft (MSFT.O), opens new tab, Amazon (AMZN.O), opens new tab and Meta (META.O), opens new tab are expected to spend at least $630 billion to build AI infrastructure this year, boosting demand for chips, servers, storage and networking equipment from companies like Broadcom. "Our visibility in 2027 has dramatically improved. Today in fact we have line of sight to achieve AI revenue from chips in excess of $100 billion in 2027," CEO Hock Tan said on a post-earnings call. The company expects second-quarter revenue to be about $22.0 billion, above analysts' average ⁠estimate of $20.56 billion, according to data compiled by LSEG. It projected AI chip revenue of $10.7 billion in the quarter. Broadcom, which supplies semiconductors and infrastructure software, does not typically design entire AI chips itself. Instead, it works with clients such as Google to develop their tensor processing units (TPU) and ChatGPT maker OpenAI on their in-house custom processors. The company's engineers help translate an early design into the physical layout of a chip that can be fabricated by manufacturers like TSMC (2330.TW), opens new tab. "Broadcom's guidance for the April quarter and into 2027 was very encouraging. While the company typically only guides one quarter at a time, the visibility into results more than a year out are an indication of significant growth in demand," said D.A. Davidson analyst Gil Luria. Tan said Broadcom is expected to deliver 1 gigawatt's worth of TPUs for AI startup Anthropic in 2026, with demand rising to 3 gigawatts in 2027. Broadcom aimed to ship OpenAI's first AI chip in 2027 and deliver over 1 ⁠gigawatt's worth of the chips. The volumes of chips disclosed for major customers by Broadcom on Wednesday showed that it is signing deals close in size to major AI chip companies such as Nvidia (NVDA.O), opens new tab, which disclosed 5-gigawatt of sales to OpenAI last week, and Advanced Micro Devices (AMD.O), opens new tab, which has signed 6-gigawatt deals with both OpenAI and Meta. Another revenue source for Broadcom is Meta Platforms (META.O), opens new tab, with Tan saying reports of a slowdown in Meta's AI chip business - part of that company's moves to design more of its own custom ⁠silicon and reduce reliance on external suppliers - were mistaken. "Meta's custom accelerator MTIA roadmap is alive and well," Tan said, using the name of Meta's custom chip. "We're shipping now." Broadcom said last month that it expected to sell at least 1 million chips by 2027 based on its stacked design tech, marking a new product and a sales target that could represent a ⁠revenue stream potentially worth billions of dollars. Growth in Broadcom's infrastructure software segment slowed to around 1% at $6.80 billion in the first quarter, compared with analysts' expectations of 2.6% growth to $6.88 billion. The company's shares have fallen around 8% so far this year, after rising around 49% in 2025. Last month, AI chip heavyweight Nvidia posted better-than-expected results for ⁠the January quarter, and forecast current-quarter revenue above market estimates. Broadcom said its first-quarter revenue rose 29% to $19.31 billion, beating analysts' average estimate of $19.18 billion. Its adjusted earnings per share of $2.05 exceeded estimates of $2.03. Its AI revenue more than doubled to $8.4 billion in the quarter ended February 1, driven by demand for custom AI accelerators and AI networking. Reporting by Jaspreet Singh in Bengaluru; Editing by Shinjini Ganguli and Stephen Coates Our Standards: The Thomson Reuters Trust Principles., opens new tab

Broadcom stock rallies as CEO Tan makes strong case for why AI growth will last

He told analysts on Wednesday that he anticipates AI chip revenue in 2027 that's "significantly in excess of $100 billion" as demand mounts for designing custom silicon. That far surpassed many bullish estimates from Wall Street analysts, who now anticipate more potential upside after Tan said the company is nearing 10 gigawatts of capacity between six customers. Analysts at JPMorgan estimate that the company can reach between $12 billion and $15 billion in revenue per gigawatt by 2027 and lifted the firm's AI revenue estimates "conservatively" to $120 billion or more. The company's "leadership in AI networking and custom silicon enables the lowest inference cost for its hyperscaler customers, and we see it delivering ongoing cost reductions on pace with market leader Nvidia," wrote analysts at Goldman Sachs. The comments came alongside Broadcom's better-than-expected quarterly results, in which AI revenue more than doubled due to AI accelerator and networking demand.

Broadcom Ships New AI Chip to Fujitsu, Plans Wider Rollout

Broadcom Inc. is shipping a new custom AI chip design to Fujitsu Ltd. that stacks components to save energy -- an approach it expects big data center operators to adopt later this year. Broadcom's 3.5D eXtreme Dimension System in Package takes two pieces of the chip called dies and stacks them top to top, rather than a previous system pioneered by Advanced Micro Devices Inc. that piles them top to bottom. The stack allows for more data to be transferred with better power efficiency, said Harish Bharadwaj, vice president of marketing in the company's custom chip unit. Broadcom, which helps design chips for companies like Alphabet Inc.'s Google and OpenAI, has been working for about five years with Taiwan Semiconductor Manufacturing Co. to figure out a way to take this step. It has contended with challenges related to delivering power to all parts of the chip and keeping the components from overheating. Fujitsu will use the chip for data centers and possibly supercomputers in the future, Bharadwaj said. The next phase will be having so-called hyperscalers -- the largest data center operators -- adopt the technology, he said. "Across all our existing hyperscaler customers -- every one of them has adopted this for their next generation," Bharadwaj said. Broadcom has "half a dozen of these designs in development today" for various customers besides Fujitsu, he said. Broadcom has emerged as key rival to Nvidia Corp., which dominates the market for AI chips. A range of customers -- from hardware sellers to AI labs to chip startups -- are looking for designs that can wring greater performance and efficiency. That helped lift Broadcom shares 49% last year.

Broadcom's custom AI chip business stays hot and gives the bulls a much-needed win

Broadcom on Wednesday delivered a solid quarterly results while painting an increasingly upbeat picture around the future of its custom AI chip business. The report showed that despite fading enthusiasm for Broadcom's stock, its most important business still has the wind at its back. Revenue in the fiscal first quarter of 2026, which ended Feb. 1, was a record of $19.31 billion, ahead of the $19.18 billion consensus forecast, according to estimates compiled by LSEG. On an annual basis, revenue rose 29%. Adjusted earnings per share (EPS) increased 28% to $2.05, also outpacing expectations of $2.03, LSEG data showed. Adjusted EBITDA grew 30% to a record $13.13 billion in the quarter, beating the FactSet consensus of $12.76 billion. A measure of operating profitability, EBTIDA is short for earnings before interest, taxes, depreciation, and amortization. AVGO 1Y mountain Broadcom's stock over the past 12 months. Bottom line We may be just scratching the surface of what's to come for Broadcom. Yes, the custom AI chip designer has already seen incredible growth during this artificial intelligence boom. However, Wednesday's earnings report and conference call make it clear there's plenty more on the way as the most important AI companies in the world look to Broadcom for help making specialized chips to further their ambitions. This report should hopefully tamp down at least some of the negativity around Broadcom's chip business -- specifically, that some of its customers like Google might look to bring more of the silicon design process in-house, relying less on Broadcom's intellectual property and more on what's called "customer-owned tooling," or COT. That concern has been one of the reasons why Broadcom's stock has struggled to gain traction this year. CEO Hock Tan said on the call that Broadcom will not see competition in customer-owned tooling "for many years to come." His rationale: We're still in the land-grab stage of the AI computing race, and customers who want specialized solutions need them fast and in significant volumes. As Tan put it, "Anybody can design a chip in a lab that works well." But the hard part is working alongside third-party manufacturers such as TSMC to ensure the chips get into production smoothly and actually work in the real world once they're fabricated. That is something Broadcom is incredibly experienced at, perhaps more than anyone else in the world aside from Nvidia. And on Broadcom's relationship with Google, in particular, Tan had encouraging things to say about the roadmap for future versions of Tensor Processing Units (TPUs). "For Google, we continue our trajectory of growth in 2026 with strong demand for the 7-generation Ironwood TPU. In 2027 and beyond, we expect to see even stronger demand from next-generations of TPU," Tan said. Another worry that has limited upside for Broadcom -- and fellow Club chipmaker Nvidia, for that matter -- is that technology giants' spending on the AI buildout is at a peak and will need to come down in the coming years. Nvidia's Jensen Huang pushed back on that last week. And on Wednesday night, Tan shed a light on Broadcom's customer spending intentions beyond 2026. It didn't sound like he's worried about a pullback based on the demand they're seeing and commitments being made from large key customers. The company's "visibility in 2027 has dramatically improved," Tan said. "Today, in fact, we have line of sight to achieve AI revenue from chips, just chips, in excess of $100 billion in 2027. We have also secured the supply chain required to achieve this." A portion of that $100 billion projection is set to come from OpenAI, which late last year was confirmed to be Broadcom's sixth custom silicon customer. That relationship seems to be moving along well. OpenAI is expected to "deploy, in volume, their first generation XPU in 2027, at over 1GW of compute capacity," Tan said. XPU is Broadcom's preferred abbreviation for custom chips. Broadcom executives also addressed a big concern about short-term hits to gross profit margins in the back half of this fiscal year -- stemming from increased shipments of certain custom chip orders that contain more non-Broadcom components such as memory. This topic became a major issue the last time Broadcom reported in December, figuring prominently into the stock's 11% sell-off on Dec. 12 . On Wednesday night's call, CFO Kirsten Spears tried to walk back that commentary. "On further study, relative to even comments that I did make last quarter, the impact relative to our overall mix is actually not going to be substantial at all. So I wouldn't worry about it," Spears said. That was positive to hear, especially considering that gross margins of 77% in the quarter reported Wednesday night did come up a tad short versus expectations. Nevertheless, better-than-expected sales and improved operating efficiency allowed for Broadcom's operating margin to expand year over year and exceed Wall Street expectations. In turn, that filtered into the earnings beat. Also serving to alleviate any concerns about the reported quarter is management's forecast for the current quarter. On the release, Tan called out that AI revenue growth is expected to accelerate. For her part, finance chief Spears added that overall revenue growth is expected to accelerate as well, to a level above what the Street was anticipating. Earnings estimates will also need to be revised higher, as Broadcom forecast a better EBITDA margin than the Street was modeling coming into the print. Along with the solid results and upbeat guidance, management further signaled confidence in sustained demand by announcing a newly authorized $10 billion share repurchase authorization. Putting it all together, Broadcom tackled the overhangs surrounding its stock head on, and the market is responding nicely in extending trading, with shares up about 5%. Bull-versus-bear debates usually take time to be resolved, but this is a positive development in favor of the bulls. We're reiterating our buy-equivalent 1 rating and price target of $425. Segment commentary In Semiconductor Solutions, the much larger of the two operating segments and the one Wall Street is focused on because it houses its AI business, revenue surged 52.4% year over year to $21.52 billion. That exceeded expectations of $12.4 billion, according to FactSet. AI semiconductor revenue jumped 106% year over year to $8.4 billion. That figure includes both custom chip revenue and AI networking products -- things like Ethernet switches that help stitch the data center together. Custom chip revenue, in particular, increased 140% year over year in the quarter, with Tan noting that the momentum has continued into the second quarter. Regarding the legacy semiconductor sub-unit, fiscal Q1 revenue came in at $4.1 billion. Growth in enterprise networking, broadband, and server storage revenues were offset by the seasonal decline in wireless (as is the case following the launch of an iPhone given that the component orders are placed ahead of the launch). In Broadcom's other operating segment, Infrastructure Software , revenue grew slightly year over year to $6.8 billion, missing the $6.99 billion consensus estimate, according to FactSet. On the call, Tan said that VMware was up 13% year over year, adding that "bookings continued to be strong as total contract value booked in Q1 exceeded $9.2 billion," resulting in sustained annual recurring revenue growth of 19% year over year. Tan also tried to assuage concerns that VMWare could be disrupted by AI, which has been a concern across the industry this year. VMWare's virtualization software is enabler of cloud computing. VMWare "cannot be disintermediated or replaced," Tan said. "It allows enterprises, in fact, to scale complex generative AI workloads effectively with agility that hardware alone cannot provide. We are confident that the growth in generative and Agentic AI will create the need for more VMware, not less." Guidance For its current (second) fiscal quarter, Broadcom forecasted total revenue to be about $22 billion, well ahead of the $20.56 billion expected, according to estimates compiled by LSEG. Importantly, AI revenue growth is expected accelerate in the coming quarter, with the team forecasting $10.7 billion in AI revenue in the second quarter. Add in the legacy semiconductor business forecast of approximately $4.1 billion, and we get a Semiconductor Solutions segment guide of $14.8 billion, well ahead of the $13.29 billion consensus forecast, according to FactSet. For Infrastructure Software, the $7.2 billion revenue guide also outpaced the $7.13 billion estimates from FactSet. The company expects fiscal Q2 adjusted EBITDA to be approximately 68% of projected revenue, or $14.96 billion, ahead of the FactSet consensus of 67.1% and $13.76 billion, respectively. (Jim Cramer's Charitable Trust is long AVGO. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Broadcom CEO Hock Tan sees AI chip revenue 'significantly' above $100 billion next year

Broadcom CEO Hock Tan sees the artificial intelligence boom gaining so much steam that he's projecting AI chip revenue next year "significantly in excess of $100 billion." After the chipmaker reported better-than-expected results for the fiscal first quarter and issued a strong forecast for the current period, Tan said on his company's earnings call that demand is picking up from large customers that are increasingly in need of Broadcom's help in designing custom silicon. "We have also secured the supply chain required to achieve this," Tan said, regarding the 2027 sales target. AI revenue in the first quarter more than doubled from a year earlier to $8.4 billion, while total sales increased 29% to $19.3 billion. The company expects AI semiconductor revenue of $10.2 billion this quarter. Broadcom shares popped more than 5% in extended trading on Thursday after Tan's comments. Chip companies like Broadcom have faced a number of headwinds in recent months, including a shortage of the high bandwidth memory crucial for custom accelerators, and capacity constraints at the most advanced levels of chip manufacturing and packaging. Broadcom helps its customers translate their chip designs into silicon, providing back-end support before the processors are sent off to be manufactured at huge fabrication plants by companies like Taiwan Semiconductor Manufacturing Company.

Broadcom's AI chip business jumps 106% as it cruises to another solid earnings and revenue beat - SiliconANGLE

Broadcom's AI chip business jumps 106% as it cruises to another solid earnings and revenue beat Artificial intelligence chipmaker Broadcom Inc. showed little sign of slowing down as it delivered its latest financial results, easing past Wall Street's expectations and offering solid guidance for the current quarter. Its stock moved 4% higher in extended trading. The company reported first-quarter adjusted earnings of $2.05 per share, beating the analyst's projection of $2.03 per share, while revenue jumped 29% from a year earlier to $19.31 billion, ahead of the $19.18 billion consensus. Net income for the quarter came to $7.35 billion, up from $5.5 billion in the same period one year ago. "We have line of sight to achieve AI revenue from chips, just chips, in excess of $100 billion in 2027," Broadcom Chief Executive Hock Tan (pictured) told analysts on a conference call. "We have also secured the supply chain required to achieve this." Looking at the current quarter, Broadcom anticipates $22 billion in sales, way ahead of the Street's $20.56 billion forecast. It's also forecasting an adjusted profit margin of 68%, ahead of the 66% consensus. Semiconductor solutions revenue is expected to top $14.8 billion, the company said, compared to the Street's $13.06 billion consensus estimate. Broadcom is enjoying stellar growth thanks to the vital role it plays in helping companies such as Google LLC, Amazon Web Services Inc. and Microsoft Corp. design their own AI processors and turn them into silicon. It provides essential services, backed technologies and intellectual property to these companies. Once their designs are ready, they're shipped off to chip fabrication plants such as those operated by Taiwan Semiconductor Manufacturing Co. Tan said the company's AI chip-related revenue jumped 106% from a year earlier to $8.4 billion in the quarter. This growth was driven by "robust demand for custom AI accelerators and AI networking," he said. Broadcom also sells network interconnects, software and other components needed to link AI processors into large clusters. All told, Broadcom's semiconductor solutions unit delivered $12.52 billion in sales, above the analysts' projection of $12.25 billion. However, its infrastructure solutions business failed to meet expectations, with sales of $6.8 billion falling short of the Street's $7.02 billion target. There has been a lot of concern in recent weeks that AI models could pose a competitive threat to traditional enterprise software companies, and many of the biggest have come under pressure. Their stocks have declined this year, and the iShares Expanded Tech-Software Sector Exchange-Traded Fund has so far lost 19% of its value. But it seems nothing can derail Broadcom, which notably acquired the server virtualization software giant VMware in 2023. Tan told analysts this quarter was just a blip, and that he expects revenue from the infrastructure software business to grow 9% in the current quarter to $7.2 billion, ahead of the Street's consensus. "Let me reinforce that this growth in our software business reflects our focus and investments in foundational infrastructure," he insisted. "Our infrastructure software is not disrupted by AI." Zacks Investment Research analyst Andrew Rocco told SiliconANGLE that Broadcom's acquisition of VMware has been successful so far, adding to the strong momentum fueled by growth in AI semiconductors. "Broadcom is merely entering the early innings of its hyper-growth phase," he predicted. "I believe investors will gravitate towards the stock, because regardless of which software companies win the AI race, they are all investing in Broadcom's networking chips and custom accelerators." Tan offered a very rosy outlook in terms of its custom AI chip business. In December, he revealed that the AI model maker Anthropic PBC had placed a $10 billion order for custom accelerators made by Google, and he offered a deeper perspective on that deal today. He said he expects Anthropic to buy one gigawatt worth of Google's tensor processing units in 2026, and more than three gigawatts in 2027. In addition, he said he expects OpenAI Group PBC to deploy over a gigawatt of its first-generation custom processors in 2027. Like the hyperscalers, OpenAI has also been working with Broadcom to develop its own AI chips. Meanwhile, Tan said he expects the company to get a big boost from Meta Platforms Inc.'s next-generation MTIA custom chip, even though some analysts have raised concerns in recent weeks that its development appears to have stalled. "The MTIA roadmap is alive and well," Tan said, dismissing such concerns. He added that it's shipping now and Meta is targeting "multiple gigawatts" of custom accelerator capacity in 2027 and beyond.

Broadcom Results Top Wall Street Estimates on Strong AI Demand. Will That Revive a Slumping Stock?

The stock has lost more than a fifth of its value from its December highs amid a broader pullback in AI-exposed stocks. Can Broadcom's latest quarterly results revive enthusiasm for its stock? Shares of Broadcom (AVGO) were recently up more than 4% in extended trading, after the chipmaker posted better-than-expected results for its fiscal first quarter. Broadcom posted adjusted earnings per share of $2.05 on a 29% year-over-year jump in revenue to a record $19.31 billion as AI sales more than doubled. Both figures topped analysts' estimates compiled by Visible Alpha. CEO Hock Tan said Broadcom saw "robust demand for custom AI accelerators and AI networking," and that he sees that momentum continuing in the current quarter. The supplier for Meta (Meta) and Alphabet's (GOOGL) Google forecast second-quarter revenue of $22 billion, above the $20.31 billion analysts called for. If Broadcom's gains hold, they could help the shares recover some of their recent losses. They were down about 8% for 2026 through Wednesday's close, after a broader pullback in many AI-exposed stocks in recent weeks.

US Stocks: Broadcom shares rise as $100 billion AI forecast signals gains in Nvidia-dominated market

Broadcom shares rose nearly 3% on Thursday after the company predicted over $100 billion in AI chip sales next year, signaling rapid share gains in the market dominated by Nvidia. Broadcom shares rose nearly 3% on Thursday after the company predicted over $100 billion in AI chip sales next year, signaling rapid share gains in the market dominated by Nvidia. Big Tech's push to secure the vast computing power needed for artificial intelligence has lifted ⁠Broadcom ⁠in the data-center infrastructure race as it helps design custom processors that can serve as an alternative to Nvidia's costly chips. Alphabet, Microsoft, Amazon and Meta are expected to spend more than $600 billion to build AI infrastructure this year, boosting demand for chips, servers, storage and networking equipment. Broadcom, which supplies semiconductors and infrastructure software, has visibility for about 10 gigawatts worth of AI demand ⁠in 2027 from its clients such as Anthropic and Meta Platforms, Melius Research analysts said. This demand equates to the power consumption needs ⁠of more than 8 million U.S. households. The volumes put Broadcom closer to the scale of recent AI chip deals by Nvidia and AMD, as the rise of custom processors, known as ASICs, increasingly threatens Nvidia's stronghold in the advanced data-center infrastructure market. Both Broadcom and its rival, Nvidia, have seen their stocks decline so far this year amid investor concerns around whether heavy spending on AI will generate sufficient returns to justify lofty tech valuations. "While investors continue to discuss the sustainability of AI capex growth, our industry research suggests the ⁠opportunity for Broadcom is broadening rather than peaking," Summit Insights analysts said in a note on Wednesday. Thursday's jump could add over $42 billion to Broadcom's market value if gains hold. CEO Hock Tan also assured investors the company was well-placed amid widespread supply shortages of memory chips and limited capacity at AI processor manufacturer TSMC. The company has fully secured capacity of leading-edge wafers and high-bandwidth memory through 2028, he said on Wednesday.

Broadcom CEO Explains $100B Chip Vision, Nvidia, VMware And Supply Chain Success

Broadcom's Hock Tan explains his plan to generate over $100 billion in chip sales by 2027, how agentic AI boosts VMware revenue, how his company is 'gaining' networking share and what large customers Google, OpenAI and Anthropic are buying. CEO Hock Tan is bullish that Broadcom will generate over $100 billion in chip sales by 2027, that agentic AI will boost its VMware business, and how large customers like Google, Anthropic and OpenAI are elevating Broadcom to the next level. "We have a line of sight to achieve AI revenue from chips, just chips, in excess of $100 billion in 2027," Tan said during Broadcom's earnings report for first-quarter 2026 Wednesday. "We have also secured the supply chain required to achieve this," Tan said. "We have fully secured capacity of these components for 2026 through 2028." In terms of VMware, sales grew 13 percent year over year, with total contract value booked exceeding $9.2 billion. "We are confident that the growth in generative and agentic AI will create the need for more VMware, not less," Tan said. [Related: VMware Head On 'Huge VCF Tailwind' From Memory Shortages, Server Prices Issues] Tan also spoke at length about strong demand for its chips and technology from its six largest customers, including Google, Meta, Anthropic and OpenAI, as well as competition from Nvidia. "You need the best chip that is around because you are competing against other LLM players. And most of all, you are also competing against Nvidia, who is by no means letting down their guard," Tan said. "They are producing better and better chips with every passing generation." Before jumping into Tan's boldest remarks, here's a look at Broadcom's first fiscal quarter 2026 financial earnings results, which ended Feb. 1, 2026. Broadcom generated $19.3 billion in revenue for first-quarter 2026, representing a 29 percent increase year over year. From Broadcom's $19.3 billion in total sales, $12.5 billion came from its Semiconductor Solutions business, while $6.8 billion was generated from its Infrastructure Software Group. AI revenue increased 106 percent year over year to $8.4 billion in first-quarter 2026. Broadcom is projecting AI revenue to reach $10.7 billion during its current second fiscal quarter of 2026. Net income was $7.3 billion, up 34 percent year over year. Broadcom's financial guidance for second-quarter 2026 is $22 billion, which represents a 47 percent increase year over year. Here are the boldest comments from CEO Tan during his company's first-quarter 2026 earnings report Wednesday.

Broadcom rallies as it touts more than $100 billion in AI chip sales in 2027 - The Economic Times

Broadcom shares jumped about 7% before the bell on Thursday after the company said it expects artificial intelligence chip sales to top $100 billion in 2027, as it pushes into a market long ruled by Nvidia. Big Tech firms such as Alphabet, Microsoft , Amazon ⁠and ⁠Meta are expected to spend more than $600 billion to build AI infrastructure this year, boosting demand for chips, servers, storage and networking equipment. Broadcom expects to deliver 3 gigawatts worth of tensor processing units for AI work to Anthropic in 2027, and plans to ship OpenAI's first AI ⁠chip, delivering over 1 GW, in the same year. The volumes put Broadcom closer to the scale of ⁠recent AI chip deals by Nvidia and AMD. Investors are, however, questioning whether heavy spending on AI will generate sufficient returns to justify the lofty valuations, leading to sharp declines in the world's most valuable technology stocks. Broadcom's stock is down about 8.3% so far this year, while Nvidia is down about 2%. "The AI spend overhang will still linger, but Broadcom made a strong case for their AI revenue to outgrow the ⁠market," said analysts at Jefferies. Broadcom expects second-quarter revenue to be about $22 billion, above analysts' average estimate of $20.56 billion, according to data compiled by LSEG. It projects AI chip revenue of $10.7 billion in the quarter. The company also announced a new share repurchase program of up to $10 billion through the end of the year.

Broadcom aims to sell 1M 3D stacked chips by 2027

Broadcom (AVGO) said that it expects to sell at least 1M chips by 2027 based on its stacked design technology, Reuters reported, citing Harish Bharadwaj, vice president of product marketing at Broadcom. Bharadwaj said the 1M chips the company projects Broadcom projects the technology could lead to billions in revenue, with AI chip revenue expected to double year-over-year. The stacked design gives customers chips with higher performance and lower energy use to meet growing AI software demands. Broadcom reports that nearly all of its customers are now adopting the stacking technology, with Fujitsu and others involved.

Chip designer Broadcom expects to sell 1 million 3D stacked chips by 2027

The company has refined the technology over five years to the point where its first customer, Fujitsu, is making engineering samples to test the design. Fujitsu plans to produce the stacked, or 3D, chips later this year. Artificial intelligence chip designer Broadcom said that it expects to sell at least 1 million chips by 2027 based on its stacked design tech, an executive told Reuters on Wednesday. The forecast, which Reuters is the first to report, marks a new product and sales target for Broadcom that could represent a revenue stream potentially worth billions of dollars. Harish Bharadwaj, vice president of product marketing, said the 1 million chips the company projects it will sell are based ⁠on an ⁠approach Broadcom developed that stacks two chips on top of one another, allowing the distinct pieces of silicon to be tightly bound to improve the speed at which data can flow from one chip to another. The company has refined the technology over five years to the point where its first customer, Fujitsu, is making engineering samples to test the design. Fujitsu plans to produce the stacked, or 3D, chips later this year. The million-chip figure includes several additional designs beyond the Fujitsu chip. The company's stacking approach gives its customers the ability to ⁠build chips that have more horsepower and use less energy to tackle the rapidly growing computing requirements AI software presents, Bharadwaj said. "Now, pretty much all of our customers are adopting this technology," he ⁠said. Broadcom does not typically design entire AI chips itself. It works with companies such as Google for its tensor processing units (TPUs) and ChatGPT maker OpenAI for its in-house custom processors. The Broadcom engineers help translate an early design into the physical layout of a chip that can be fabricated by manufacturers such as TSMC. The company's chip business has grown significantly because of the custom deals with companies such as Google. Broadcom projected that its AI chip revenue would double year-over-year to $8.2 billion in its first fiscal quarter. As a result, Broadcom has emerged as one of the most significant competitors to Nvidia and Advanced Micro Devices, as it races to produce silicon that competes with the chip giants. Fujitsu is using the new tech for a data center chip. Taiwan Semiconductor Manufacturing Co is fabricating the chip using ⁠its cutting-edge 2-nanometer process and fusing it with a 5-nanometer chip. Companies can mix and match which manufacturing process TSMC uses with the Broadcom technology. TSMC fuses the top and bottom chip during the fabrication process. Broadcom has several more designs in the works and expects to ship two more products based on the stacking tech in the second half of this year and to sample an additional three in 2027. The company spent roughly five years developing the groundwork for the stacked chip tech and testing various designs to come up with a commercial product. Engineers are working to make chips that have as many as eight stacks of two chips each.

Broadcom rises as US$100 billion AI forecast signals gains in Nvidia-dominated market

Broadcom shares rose nearly three per cent on Thursday after the company predicted over US$100 billion in AI chip sales next year, signaling rapid share gains in the market dominated by Nvidia. Big Tech's push to secure the vast computing power needed for artificial intelligence has lifted Broadcom in the data-center infrastructure race as it helps design custom processors that can serve as an alternative to Nvidia's costly chips. Alphabet, Microsoft, Amazon and Meta are expected to spend more than $600 billion to build AI infrastructure this year, boosting demand for chips, servers, storage and networking equipment. Broadcom, which supplies semiconductors and infrastructure software, has visibility for about 10 gigawatts worth of AI demand in 2027 from its clients such as Anthropic and Meta Platforms, Melius Research analysts said. This demand equates to the power consumption needs of more than 8 million U.S. households. The volumes put Broadcom closer to the scale of recent AI chip deals by Nvidia and AMD, as the rise of custom processors, known as ASICs, increasingly threatens Nvidia's stronghold in the advanced data-center infrastructure market. Both Broadcom and its rival, Nvidia, have seen their stocks decline so far this year amid investor concerns around whether heavy spending on AI will generate sufficient returns to justify lofty tech valuations. "While investors continue to discuss the sustainability of AI capex growth, our industry research suggests the opportunity for Broadcom is broadening rather than peaking," Summit Insights analysts said in a note on Wednesday. Thursday's jump could add over $42 billion to Broadcom's market value if gains hold. CEO Hock Tan also assured investors the company was well-placed amid widespread supply shortages of memory chips and limited capacity at AI processor manufacturer TSMC. The company has fully secured capacity of leading-edge wafers and high-bandwidth memory through 2028, he said on Wednesday.

Broadcom Gains as AI Chip Outlook Points to $100B Revenue Path by 2027 | Investing.com UK

Broadcom (NASDAQ:AVGO) shares surged approximately 7% in premarket trading on Thursday, March 5, 2026, after CEO Hock Tan declared the company has clear visibility to surpass $100 billion in AI chip sales by 2027. The announcement came on the heels of a record-breaking fiscal Q1 2026 earnings report, where the company posted $19.3 billion in revenue and AI semiconductor sales that more than doubled year-over-year. The bold forecast positions Broadcom as a formidable challenger to Nvidia's (NASDAQ:NVDA) dominance in the AI accelerator market, backed by high-profile chip partnerships with OpenAI, Anthropic, Google, and Meta (NASDAQ:META). With a new $10 billion share repurchase program also announced, Broadcom sent a confident signal to investors navigating an increasingly scrutinized AI spending landscape. During Broadcom's Q1 2026 earnings call, CEO Hock Tan stated the company has "line of sight" to exceed $100 billion in AI chip revenue in 2027, a figure that would represent a massive leap from the $20 billion the company reported in AI sales for all of 2025. For the current fiscal Q2, Broadcom projects AI chip revenue of $10.7 billion alone, underscoring the accelerating pace required to reach that annual target. The company also confirmed it has secured the supply chain necessary to support this scale of production, adding credibility to what might otherwise seem like an aspirational milestone. Broadcom's AI chip strategy centers on custom-built semiconductors, covering both AI accelerators and networking chips, serving as a direct alternative to Nvidia's off-the-shelf GPU-based solutions. Key client commitments include delivering over 3 gigawatts of tensor processing units to Anthropic in 2027, and shipping OpenAI's first custom AI chip, exceeding 1 gigawatt of computing capacity, in the same year. CEO Tan also reaffirmed that Broadcom's chip roadmap with Meta Platforms remains active, with next-generation products expected to scale to multiple gigawatts in 2027 and beyond, pushing back against recent reports suggesting Meta might be pulling back. Analysts at Jefferies acknowledged that while concerns about AI spending returns will persist, Broadcom made a compelling case for its AI revenue growth outpacing the broader market. Even so, Nvidia's scale remains in a different league -- the company is expected to generate around $333 billion in AI data center revenue in fiscal 2027. Big Tech firms including Alphabet (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN), and Meta are collectively forecast to spend more than $600 billion on AI infrastructure this year, a macro tailwind that benefits Broadcom's networking and custom chip businesses simultaneously. As of premarket trading on Thursday, March 5, 2026 at 6:23 AM EST, AVGO was trading at $340.60, up $23.07 or 7.27%, following a regular session close of $317.53 on March 4. The stock had closed the prior day at $313.84, and the premarket surge reflected the market's positive reaction to both the Q1 earnings beat and the $100 billion AI chip forecast. The stock's 52-week range spans $138.10 to $414.61, and its current market cap stands at approximately $1.505 trillion. Despite the premarket surge, AVGO has had a challenging start to 2026, down roughly 8.25% year-to-date versus the S&P 500's modest gain of 0.35% over the same period. Investors have broadly grown cautious about whether AI infrastructure spending will generate sufficient returns, a sentiment that weighed on the stock even as its longer-term performance remains exceptional -- up over 70% in the past year and an extraordinary 695% over five years. The most recent analyst action came from RBC Capital on March 2, which maintained a Sector Perform rating while lowering its price target from $370 to $340, reflecting near-term valuation caution. From a fundamentals standpoint, Broadcom reported Q1 FY26 adjusted EPS of $2.05, narrowly beating the $2.03 consensus estimate, while revenue of $19.31 billion matched expectations. The company's trailing P/E stands at 66.71, with a forward P/E of 31.35 and a notably low PEG ratio of 0.87, suggesting the stock may be reasonably valued relative to its growth prospects. The average analyst price target sits at $455.51, implying significant upside from current levels, and the new $10 billion buyback program announced alongside earnings provides additional support for the share price going forward. *** Looking to start your trading day ahead of the curve?

Broadcom Q2 revenue guidance beats, sees $10.7 billion in AI semiconductor sales By Investing.com

Investing.com -- Broadcom on Wednesday delivered a quarterly top- and bottom-line beat and provided current quarter revenue guidance that surpassed expectations. Shares of the company whipsawed after hours, last up 0.5%. Palo Alto, California-based Broadcom is a major player in the semiconductor and infrastructure software solutions industries. The company designs artificial intelligence chips, while its other semiconductor products span several markets such as networking connectivity, wireless devices, servers and storage systems, and broadband. Its infrastructure software solutions cater to areas such as private cloud, cybersecurity, and enterprise software. For fiscal Q1 2026, Broadcom earned $2.05 per share on an adjusted basis on revenue of $19.31 billion. Analysts had expected earnings of $2.02 per share on revenue of $19.21 billion. "Broadcom achieved record first quarter revenue on continued strength in AI semiconductor solutions. Q1 AI revenue of $8.4 billion grew 106% year-over-year, above our forecast, driven by robust demand for custom AI accelerators and AI networking," top boss Hock Tan said in a statement. Broadcom's rivals include other chip designers such as Nvidia (NASDAQ:NVDA) and Qualcomm (NASDAQ:QCOM). Broadcom has gained significance as a viable alternative to Nvidia for hyperscale cloud providers such as Alphabet and Meta Platforms to make microchips known as application-specific integrated circuits (ASICs). "The last four quarters for AVGO have seen ASICs move from a second source to a real competitive option for major customers - especially Google who has begun to sell externally as well," Jefferies analyst Blayne Curtis said in an earnings preview note last week. Turning to AVGO's guidance, the chip designer expects Q2 revenue to be about $22 billion, compared to a consensus estimate of $20.4 billion. AI semiconductor revenue is expected to be $10.7 billion. Broadcom's quarterly results come at a time when the AI trade has been under pressure. In the span of a few weeks, investors' perceptions have quickly moved from "AI will lift the entire technology sector" to "AI will result in clear winners and losers." Sub-sectors such as software, office and enterprise services, and food delivery have been identified as areas which will see major disruption from AI. AI bellwether Nvidia last week delivered strong quarterly results and provided better-than-expected revenue guidance. However, the report failed to allay concerns about AI's returns and companies' massive spending plans around the technology. "AVGO and NVDA have been unable to shake the overarching capex/macro fears, with NVDA down on a borderline perfect print," Jefferies' Curtis had noted. "We still fundamentally believe both AVGO and NVDA are poised for breakouts as valuations are too depressed. NVDA earnings suggest the print will not be that catalyst, but we continue to view AVGO and NVDA as the most certain AI winners in our space trading at basement bargain multiples," he had added. Broadcom on Wednesday also said its board of directors had authorized a new share buyback of up to $10 billion.

Broadcom Sales Rise as AI Developers Build More Products and Agents -- Update

Broadcom posted higher sales in the latest quarter as the type and number of AI customers kept expanding. AI revenue in the quarter more than doubled to $8.4 billion, driven by demand for custom AI accelerators and networking, Chief Executive Hock Tan. Demand is now coming from both hyperscalers and regular companies that are looking to build out their own AI agents, he told investors on a call Wednesday. "Some of them are hyperscalers, some of them are not hyperscalers, but they all have one thing in common, which is to create LLMS, productize it and generate platforms," Tan said. The semiconductor and software maker's customer base is expanding beyond its core focus of hyperscalers like Google and Anthropic, Tan said. Customers now want help building out AI agents, code assistance platforms and consumer subscription platforms like OpenAI's ChatGPT. Broadcom expects OpenAI to deploy its first generation of XPUs in 2027 with more than one gigawatt of compute capacity, Tan said. That will make the company Broadcom's sixth major hyperscaler customer, Tan said. The company posted a first-quarter profit of $7.35 billion, or $1.50 a share, compared with $5.50 billion, or $1.14 a share, a year earlier. Stripping out certain one-time items, adjusted per-share earnings were $2.05, ahead of the $2.03 anticipated by analysts, according to FactSet. Revenue rose 29% to $19.31 billion. Analysts surveyed by FactSet forecast revenue of $19.26 billion. The company also said its board authorized a new share buyback program of up to $10 billion. Broadcom's big hyperscaler customers are starting to shift from training AI to deploying it for users. Tan said that transition has happened faster than expected, and he anticipates it will drive more demand for Broadcom's offerings. "These five, six customers of ours are on the path to creating their own custom accelerators," he said. "I think we're going to see demand keep picking up." In the current quarter, Broadcom expects revenue to be $22 billion, above analysts' projection of $20.5 billion. Tan told analysts that AI networking is projected to grow to 40% of total AI revenue as Broadcom gains more share in that market. Write to Katherine Hamilton at [email protected]

Broadcom rallies as it touts more than $100 billion in AI chip sales in 2027

March 5 (Reuters) - Broadcom shares jumped about 7% before the bell on Thursday after the company said it expects artificial intelligence chip sales to top $100 billion in 2027, as it pushes into a market long ruled by Nvidia. Big Tech firms such as Alphabet, Microsoft, Amazon and Meta are expected to spend more than $600 billion to build AI infrastructure this year, boosting demand for chips, servers, storage and networking equipment. Broadcom expects to deliver 3 gigawatts worth of tensor processing units for AI work to Anthropic in 2027, and plans to ship OpenAI's first AI chip, delivering over 1 GW, in the same year. The volumes put Broadcom closer to the scale of recent AI chip deals by Nvidia and AMD. Investors are, however, questioning whether heavy spending on AI will generate sufficient returns to justify the lofty valuations, leading to sharp declines in the world's most valuable technology stocks. Broadcom's stock is down about 8.3% so far this year, while Nvidia is down about 2%. "The AI spend overhang will still linger, but Broadcom made a strong case for their AI revenue to outgrow the market," said analysts at Jefferies. Broadcom expects second-quarter revenue to be about $22 billion, above analysts' average estimate of $20.56 billion, according to data compiled by LSEG. It projects AI chip revenue of $10.7 billion in the quarter. The company also announced a new share repurchase program of up to $10 billion through the end of the year. (Reporting by Joel Jose in Bengaluru; Editing by Vijay Kishore)

Broadcom beats expectations thanks to the AI boom

Broadcom posted better-than-expected Q1 results, supported by strong growth in its artificial intelligence-related business. The group reported adjusted EPS of $2.05 and revenue of $19.31bn, above analysts' estimates. Revenue rose 29% year-on-year for the period ended February 1. Demand for AI technologies strongly boosted activity. AI-related revenue more than doubled to $8.4bn, up 106%. According to Chief Executive Officer Hock Tan, the momentum is being driven by demand for custom AI accelerators and networking solutions for data centers. The semiconductor division generated $12.52bn in revenue, while the infrastructure software business reached $6.80bn. For Q2, Broadcom forecasts revenue of around $22bn, well above the $20.56bn expected by the market, with an adjusted EBITDA margin of 68%. The group also announced a new share buyback program of up to $10bn and expects to generate $10.7bn in AI semiconductor revenue for the current quarter. The stock was up nearly 0.5% in after-hours trading.

Broadcom Logs Higher Sales, Authorizes $10 Billion Buyback Amid Climbing AI Demand

Broadcom posted higher revenue and authorized a share buyback as AI demand continues to drive sales. The semiconductor and software maker on Wednesday posted a first-quarter profit of $7.35 billion, or $1.50 a share, compared with $5.50 billion, or $1.14 a share, a year earlier. Stripping out certain one-time items, adjusted per-share earnings were $2.05, ahead of the $2.03 anticipated by analysts, according to FactSet. Revenue rose 29% to $19.31 billion. Analysts surveyed by FactSet forecast revenue of $19.26 billion. Broadcom also said its board authorized a new share buyback program of up to $10 billion. AI revenue in the quarter more than doubled to $8.4 billion, driven by demand for custom AI accelerators and networking, Chief Executive Hock Tan said. In the current quarter, Broadcom expects revenue to be $22 billion, above analysts' projection of $20.5 billion. Write to Katherine Hamilton at [email protected]