Broadcom Partners with AI Giants for Custom Chips
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Should l Buy AVGO?
Source: NASDAQ.COM
- Custom Chip Market Growth: Broadcom is collaborating with several AI hyperscalers to design custom chips, with revenue from this segment expected to exceed $100 billion by next year, a significant increase from the current $30 billion, highlighting the company's strong potential in the AI sector.
- Doubling Revenue Expectations: With Broadcom's revenue at $68 billion over the past 12 months, the rise of custom AI chips could lead to a doubling of revenue, positioning the company to become a $100 billion business next year, reflecting optimistic market expectations for its future.
- Accelerated Product Transformation: The custom AI chip division achieved a remarkable 106% year-over-year growth in Q1, reaching $8.4 billion, indicating the company's ability to rapidly adapt to market demands and attract more client partnerships in the future.
- Competitive Industry Advantage: Broadcom's custom chips offer significant cost advantages over traditional GPUs, and as more AI hyperscalers choose to partner with Broadcom, it is expected to further solidify its leadership position in the market.
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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: 419.300
Low
370.00
Averages
457.75
High
525.00
Current: 419.300
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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