Broadcom CEO Hock Tan stated the corporate expects its AI chip gross sales to prime $100 billion subsequent yr, an announcement that despatched AVGO shares greater. “We’ve got line of sight” to achieve this milestone in 2027, he stated throughout a convention name with analysts on Wednesday. “We’ve got additionally secured the provision chain required to attain this.”
The corporate initiatives that AI chip income will probably be $10.7 billion within the present quarter, so reaching an annual tempo of $100 billion could be a significant leap. Broadcom reported $20 billion in AI gross sales in 2025. Broadcom shares rose as a lot as 4.2% on Thursday, and are up 2.5% on the time of writing.
Hock Tan isn’t the primary head of a significant AI participant to say AI chip gross sales are able to skyrocket. Certainly, NVIDIA (NVDA) CEO Jensen Huang insists that software program shares are able to pop, advising that Wall Road has the mistaken thought on the business presently. Huang argues that agentic AI is not going to substitute present enterprise software program services and products; it can use them on folks’s behalf. The AI sector was largely anticipated to growth even greater in 2026, however
In a sector largely dominated by Nvidia (NVDA), Broadcom AVGO has grow to be one of many AI-stock favorites on Wall Road. Its newest earnings report was extremely anticipated and anticipated to ship stable outcomes. Nevertheless, AVGO inventory was little moved after the outcomes simply narrowly beat analyst estimates. Adjusted earnings per share (EPS) got here in at $2.05 (in comparison with analyst estimates of $2.03), whereas adjusted web income got here in at $19.31 billion (in comparison with analyst estimates of $19.26 billion).
Moreover, Broadcom additionally delivered a better-than-estimated quarterly outlook on Wednesday and introduced a inventory buyback plan value as a lot as $10 billion. Income will probably be about $22 billion within the fiscal second quarter, which ends Could 3, the corporate stated. Analysts had predicted $20.5 billion on common, although some projections topped $22 billion,
In comparison with Nvidia, Broadcom’s progress charges seem extra modest, as Nvidia has been delivering considerably sooner income growth pushed by surging demand for its AI GPUs. Nevertheless, Broadcom’s progress is seen as extra diversified and doubtlessly steadier, supported by its customized AI chips and networking enterprise. Each AVGO and NVDA have purchase scores on Wall Road, however the hole of favortism between the 2 has drastically closed in over the past yr.
