Broadcom expects AI chip revenue to double to about $115 billion by 2027

en.Wedoany.com Reported - Broadcom reported fiscal third-quarter 2026 results, with quarterly revenue of $29.6 billion, up 86% year over year. The company expects fourth-quarter revenue of approximately $34.8 billion, a 93% increase year over year.

The AI business is the primary growth driver. In the third quarter, Broadcom's AI semiconductor revenue reached $16.7 billion, up 221% year over year. In the fourth quarter, this revenue is expected to accelerate to $21.7 billion, up 236% year over year. Broadcom President and CEO Hock Tan stated that demand for custom AI accelerators and networking products remains very strong.

During the earnings call, Hock Tan revealed that Anthropic is expected to become the company's largest XPU customer in 2027 and maintain that position in 2028. Other key customers include Google, OpenAI, and Meta. He noted that XPU customer demand is growing at an exponential rate. The vast majority of computing power for current AI workloads comes from a few leading customers who are developing the most advanced frontier models, and their demand for computing infrastructure is expected to surge further in 2027 and 2028. These customers gain advantages in performance, cost, and power consumption through XPUs.

Broadcom also provided overall guidance for AI semiconductor revenue: supply chain is secured for 2027, with revenue expected to double again to approximately $115 billion. The growth trajectory is expected to continue into 2028, with Hock Tan stating he sees the prospect of AI semiconductor revenue doubling from that level to $230 billion.

Key topics on the earnings call included the high-bandwidth Ethernet switching chip Tomahawk 6, which targets AI and high-performance data center networks. J.P. Morgan analyst Harlan Sur noted that Tomahawk 6 is ramping faster than any other switching chip family in Broadcom's history, with next year's capacity nearly sold out. Charlie Kawwas, President of Broadcom's Semiconductor Solutions Group, responded that Tomahawk 6 is available in both 100G and 200G SerDes versions, both of which have been adopted. Nearly all AI hyperscalers building XPUs with Broadcom have deployed it, and even those not using Broadcom XPUs are adopting both versions.

Kawwas added that customers building XPUs with Broadcom are currently deploying either Tomahawk 6 or the company's latest switching chip, Tomahawk Ultra. The scale-up solution is simultaneously adopting both chips. Since this solution is based on Ethernet, the system remains open and any device can connect, with relevant standards co-developed by Broadcom and the industry. This solution is currently being used in both XPU clusters and some GPU clusters nearly simultaneously.