Broadcom Signs Long-Term AI Chip Deal with Google
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy AVGO?
Source: seekingalpha
- Long-Term Partnership: Broadcom has signed a long-term agreement with Google to develop custom artificial intelligence chips, known as tensor processing units, which will last through 2031, indicating a deep collaboration in the AI sector.
- Supply Assurance Agreement: The deal includes a supply assurance clause, ensuring Broadcom will provide networking and other components for Google's next-generation AI racks, further solidifying Broadcom's position in the AI hardware market.
- Analyst Optimism: Citi analyst Atif Malik noted that this partnership could potentially raise Broadcom's AI revenue target from $100 billion to $130 billion, reiterating his Buy rating and a price target of $475 for Broadcom.
- Positive Market Reaction: Broadcom shares rose over 3% in premarket trading, reflecting investor enthusiasm for the partnership, while Alphabet's shares also saw a slight increase, indicating market optimism about the prospects of their collaboration.
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Analyst Views on AVGO
Wall Street analysts forecast AVGO stock price to rise
30 Analyst Rating
29 Buy
1 Hold
0 Sell
Strong Buy
Current: 333.970
Low
370.00
Averages
457.75
High
525.00
Current: 333.970
Low
370.00
Averages
457.75
High
525.00
About AVGO
Broadcom Inc. is a global technology firm that designs, develops, and supplies a range of semiconductors, enterprise software and security solutions. The Company operates through two segments: semiconductor solutions and infrastructure software. Its semiconductor solutions segment includes all of its product lines and intellectual property (IP) licensing. It provides a variety of radio frequency semiconductor devices, wireless connectivity solutions, custom touch controllers, and inductive charging solutions for mobile applications. Its infrastructure software segment includes its private and hybrid cloud, application development and delivery, software-defined edge, application networking and security, mainframe, distributed and cybersecurity solutions, and its FC SAN business. It provides a portfolio of software solutions that enable customers to plan, develop, automate, manage and secure applications across mainframe, distributed, mobile and cloud platforms.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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See More
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