Broadcom expects the market for its AI chips and networking products to grow to $60–$90 billion by 2027|Coolcaesar|CC BY-SA 3.0
We’ve all heard of Nvidia, but there’s a new player on the block. Semiconductor manufacturer Broadcom’s shares rose 24% on Friday, pushing its market value above $1 trillion for the first time.
The company reported strong fourth-quarter results, with revenue at $14.05 billion, up 51% from last year—beating expectations and showing massive growth in its AI chip business.
Broadcom noted its annual revenue grew 220% to $12.2 billion, driven by demand for networking parts in generative AI systems.
Its semiconductor solutions group, which also produces AI chips called XPUs, earned $8.23 billion, up 12% from last year.
The chipmaker’s stock jumped after CEO Hock Tan said they are working with three major cloud companies to create custom AI chips. Each cloud customer could deploy 1 million chips in clusters by 2027.
Broadcom expects the market for its XPUs and networking products to grow to $60–$90 billion by then.
Broadcom also announced an 11% dividend increase for 2025.
Shares of Nvidia and AMD fell on the news as investors are concerned that the chipmakers’ market share may reduce.