Broadcom stock rallies as CEO Tan makes strong case for why AI growth will last
Broadcom's AI revenue forecast surpassed many bullish expectations from Wall Street analysts.
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In this article AVGO Follow your favorite stocks CREATE FREE ACCOUNT watch now VIDEO 2:43 02:43 Broadcom CEO: AI revenue from chips could exceed $100 billion in 2027 Fast Money Broadcom 's stock surged about 5% on Thursday as CEO Hock Tan touted strong demand for the company's chips amid the artificial intelligence boom. He told analysts on Wednesday that he anticipates AI chip revenue in 2027 that's "significantly in excess of $100 billion" as demand mounts for designing custom silicon. That far surpassed many bullish estimates from Wall Street analysts, who now anticipate more potential upside after Tan said the company is nearing 10 gigawatts of capacity between six customers. Analysts at JPMorgan estimate that the company can reach between $12 billion and $15 billion in revenue per gigawatt by 2027 and lifted the firm's AI revenue estimates "conservatively" to $120 billion or more. The company's "leadership in AI networking and custom silicon enables the lowest inference cost for its hyperscaler customers, and we see it delivering ongoing cost reductions on pace with market leader Nvidia," wrote analysts at Goldman Sachs. The comments came alongside Broadcom's better-than-expected quarterly results , in which AI revenue more than doubled due to AI accelerator and networking demand. Read more CNBC tech news 5 unresolved questions hanging over the Anthropic–Pentagon fracas: 'It's all very puzzling' Amazon's Bahrain data center targeted by Iran for support of U.S. military, state media says Broadcom CEO Hock Tan sees AI chip revenue 'significantly' above $100 billion next year Defense tech companies are dropping Claude after Pentagon's Anthropic blacklist Nvidia CEO Huang says $30 billion OpenAI investment 'might be the last' Over the last few months, chipmakers have grappled with a shortage in high-bandwidth memory as AI demand snaps up supply. But Tan told analysts that the company has secured memory and leading-edge wafer supply through 2028. Tan managed to conv...
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