Broadcom Lifts AI Chip Forecast as Big Tech Spending Accelerates
Strong demand for custom processors and networking equipment points to continued expansion in artificial intelligence infrastructure.
SAN JOSE, Sep 2: Broadcom has raised its outlook for artificial intelligence chip revenue, signalling continued strong demand as major technology companies expand investments in AI infrastructure.
The semiconductor and networking company now expects revenue from AI chips to reach approximately $115 billion in fiscal 2027, up from its previous forecast of more than $100 billion.
Broadcom expects the figure to double to around $230 billion by 2028, reflecting the rapid expansion of computing infrastructure needed to operate increasingly sophisticated AI applications.
The company reported AI chip sales of $16.7 billion in its latest quarter, helping drive total revenue to $29.59 billion and exceeding Wall Street expectations.
Chief Executive Hock Tan said Broadcom has secured enough supply to meet rising demand, with major customers including Anthropic, OpenAI and Meta making substantial infrastructure commitments.
The strong outlook also highlights a broader shift within the AI hardware market. While Nvidia remains a dominant supplier of AI processors, technology companies are increasingly turning to customised chips and alternative networking solutions to support their growing computing requirements.
Broadcom’s forecast suggests that spending on AI infrastructure is likely to remain strong as businesses and technology companies expand data centre capacity and develop increasingly complex AI systems.
However, the company offered a slightly weaker than expected revenue forecast for its next quarter, indicating that the wider semiconductor market continues to face competitive and demand related uncertainties.
