Quick Read – Broadcom’s custom XPUs and networking silicon drove Q2 AI revenue to $10.8 billion, up 143% year over year across eight straight EPS beats. – AVGO trades at $416 with a $528 consensus target, implying 27% upside and near-unanimous analyst Buy ratings. – CEO Hock Tan…
ojects AI revenue exceeding $100 billion in FY2027, backed by signed multi-generation deals with Google, Meta, OpenAI, and Anthropic. – At $416.08, Broadcom (NASDAQ:AVGO) is a Buy. The real question about AI infrastructure spending is which suppliers own the most durable share of the wallet
Broadcom’s mix of custom silicon, networking, and recurring software makes it the least volatile way to press that bet. Broadcom designs custom AI accelerators (XPUs) that hyperscalers deploy as alternatives to merchant GPUs, builds the switches and optics that wire those chips together, and owns VMware’s virtualization stack running enterprise data centers. The stock has climbed from $318.95 last September to the current level on eight straight EPS beats and Q2 FY2026 AI semiconductor revenue of $10.80 billion, up 143% year over year.
The Custom Silicon and Networking Tollbooth Thesis The bull case rests on Broadcom’s grip on two chokepoints. First, custom XPUs: Google, Meta, OpenAI, and Anthropic have signed multi-generation deals, with OpenAI committed to 10 gigawatts by 2029 and Meta’s MTIA X program running through 3 gigawatts by end of 2028. Second, networking silicon accounted for 40% of Q2 AI revenue and sells into GPU and XPU clusters, making Broadcom paid regardless of which accelerator wins.